It means you have 30% chance to Parry. Parry more or less halves the incoming damage. It applies to physical and magic attacks but not DoT effects :>
The base value is increased by STR (or INT for magic casters, and both STR+INT for Monks) and some Equipment bonuses.
Related, the Warrior's Parrying skill adds a flat rate to your Parry, while Defender multiplies the base by 1.3.
Edited by Chocs, 09 May 2013 - 04:52 PM.