If you tighten it, it pulls the neck back (lees relief) and the strings down towards the frets.

If you loosen it, it allows the neck to bend more towards the bridge (more relief) and the strings to raise higher from the frets.

That being said, you shouldn't use the truss rod to set the action, only the proper relief of the neck so you don't get buzzing on the upper frets. i.e. the strings vibrate at the widest part of their arcs towards the middle part of their length, usually from the 9th to the 15th frets (depending on where the string is fretted or whether you are using a capo). The relief allows the frets at those points to be firthest away from the strings--a tradeoff between action height and intonation.

The action height should be adjusted by setting the bridge saddle height and the notches at the nut. Again, a tricky bit of tradeoff. For more extreme adjustment needed, a neck reset might be called for.