The total number of items for which you have written purchase orders but not yet received. QuickBooks automatically keeps track of this number for all the invoice items on your Item list.
How quantity on order changes:
It increases when you write a purchase order for the item. For example, if you have 30 faucets on order and then discover that you need 20 more, QuickBooks increases the quantity on order to 50 when you write a purchase order for the additional 20 faucets.
It decreases when you record a receipt from a vendor for that particular item. For example, if you have 50 faucets on order and then receive 30 of them, QuickBooks decreases the quantity on order to 20 when you record the receipt for the 30 faucets.