When you are in 'do not disturb,' your callers are redirected to voicemail if available.  Otherwise, the caller hears busy tone.
People calling from numbers in your 'do not disturb' exceptions list can still call you. However, forwarding can still be applied to these calls.
Calls to any hunt group of which you are a member are not presented to you (unless you are the last available member of the group).
Enabling 'do not disturb' will not affect any calls already being presented to your phone.
You can still use the phone to make outgoing calls. When you go off-hook you will hear broken dial tone.
N = No Calls (Do Not Disturb)
An N is shown after your extension name on the phone's idle display when you have 'do not disturb' enabled.