In Kermit jargon the words ``local'' and ``remote'' have exactly the same meaning as they do in everyday life.
``Local'' means ``nearby''. The local system is the closer of two communicating systems; it can directly interact with you via the keyboard and screen while it's transferring files.
``Remote'' means ``far away''; therefore of the two computer, the more distant one is the remote. All file transfer is done over the line on which you logged in.
When the local Kermit is CONNECTed to the remote computer, again running its own copy of Kermit, the local Kermit is in control of the screen, whereas the remote Kermit has no direct access to it.
Some commands make sense only for remote Kermits others only for local, still others can be used with either.