LoS is an acronym for line of sight; line of sight is a straight line along the field of vision of an observer, a line of sight has to be free of obstructions to be considered a line of sight.
A rangefinder is simply known as a distance measuring device that provides an automatic reading of the target distance, aiming point, and even magnification.
The rangefinder considers external elements like the surroundings of the target including trees and rocks, it also considers the inclination angle of the observer, wind, rain, fog, and even darkness or poor lighting conditions.
Before the invention of rangefinders, shooters and hunters had to gauge the distance of their targets by eyeballing them or relying on pure instincts.
Fortunately, rangefinders have made aiming and hunting a whole lot easier for everyone. The rangefinder provides an automatic distance of the target from the observer and it does this by creating a line of sight to the target.

What does LoS Mean on a Rangefinder
There is a whole explanation about the working mechanism of rangefinders. Line of sight of the observer as provided by the rangefinder is quite an interesting thing.
When a rangefinder is used on a levelled field or ground, the line of sight distance given by the rangefinder is equal to the horizontal distance to the same target. Remember that a line of sight is a vertical vision to the target point.
If you picture this well, you would notice that this would create a perfect 90-degree angle. However, when the point of observation is in an elevated position or a declined position, the mechanism of the line of sight changes completely.
In this case, it does not matter who is elevated or declined, it could be the observer or the target. As the elevation decreases or increases, the distance of the line of sight increases but the horizontal distance remains constant. When aiming to shoot, the horizontal distance is often the guide for a great aim.
A laser rangefinder with a line of sight, like the name implies, has a laser beam that is shot towards the target.
The rangefinder calculates the time it takes for the light to travel back and forth the target, the line of sight is generally created simultaneously with this mechanism.
In order for the line of sight sensor to work, the target should be visible to the rangefinder light source.
Essentially, the LoS is very important to the rangefinder because the line of sight is what provides the observer with the point of aim, it measures the distance of the target from the observer, and it provides an exact location of the target.