What is the purpose of a squelch function?

The squelch function on a receiver is designed to quiet or mute the speaker when no valid signal is being received. Without squelch, the receiver would output a constant, loud, and annoying static hiss caused by background RF noise. When a signal arrives that is stronger than the squelch threshold you have set, it 'breaks' the squelch, acting as an audio gate that opens to allow the audio to pass through to the speaker. Squelch does not reduce key clicks or eliminate impulse noise; it merely mutes the audio when nothing is transmitting.