The ready room is the captain's private office next to the bridge, used for meetings, reviewing reports and making decisions away from the crew's view.
On the Enterprise-D, Captain Picard used his ready room to meet officers, receive private communications and think through difficult choices, often over a cup of tea. The room's door opened directly onto the bridge, so he could return to command at a moment's notice.
Later captains, including Kathryn Janeway aboard Voyager, used their ready rooms in much the same way, and the space often reflected each captain's personal taste. It typically holds a desk, a computer terminal, seating for visitors and a replicator.