In the message composition window of Thunderbird or Seamonkey, it comes in handy when inserting long text lines which should not get wrapped in the final message (such as log file entries, or diffs inserted into the message body). It only has an effect when using plain text mode for composition - this is a per-account setting which must be configured by disabling Composition & Addressing → Composition → Compose messages in HTML format.
Unchecking Enable Word Wrap in the Options menu (or pressing the keyboard shortcut) will temporarily turn off word wrapping for the current message - lines will take up the whole width of the composer window, and no line breaks will get added to the outgoing message (with the exception of "hard" line breaks inserted manually).
Checking Enable Word Wrap will enable word wrapping again and set it to the standard width (which is modifiable through the
mailnews.wraplength preference in the Config Editor, the default is 72 characters).
In a browser window (Firefox or Seamonkey), checking Word Wrap Within <PRE> in the View menu will temporarily enable word wrapping for
<pre> tags in the current document (by adding CSS rules to the
head element). Unchecking the menu entry will revert the document to the previous state (no word wrapping).