A kneewall is a wall that is finished on one side (sheetrock & paint) that faces conditioned space, while the opposite side is un-finished and faces unconditioned space (attic, crawlspace, etc).
If you have a split level home, you likely have a kneewall that separates the two attic elevations. If you have a tri-level home, you have two kneewalls: one upstairs facing the attic and one downstairs facing your crawlspace. Most every bonus room has one or two kneewalls.