This command is usually used to remove a services enforcer from your account. When a failed log in attempt occurs on a registered nickname and services forces the user to change their nickname, then an enforcer will be used to keep the nickname from being used by anybody at all. You can use this command to remove the enforcer from a nickname you own, thus allowing you to recover use of the nickname.
This command takes 1 or 2 arguments, the name of the nickname to be recovered, and the password for the nickname if you are not already logged into services with that nickname. To recover the nickname nick1 with the password letmein, you would use this command:
/msg NickServ recover nick1 letmein