It means that your controller has temporarily paused irrigation due to a setting in the programming for Omit Time, Rain Delay or cycle/soak to prevent water runoff.
If you are using an SLW series weather station, the controller will also pause for 48 hours after a rain sensor shutdown. The controller will resume watering at the first scheduled start time after the pause. If you want to delete the 48 hour pause, just press the sensor button to put the unit into bypass and then press the button again to put the sensor mode back to active. The LED will be green.
The controller will also show PAUSE momentarily when it switches from one zone to another zone.