Not all terminals agree on what colour to turn the screen when the server sends a ‘clear screen’ sequence. Some terminals believe the screen should always be cleared to the default background colour. Others believe the screen should be cleared to whatever the server has selected as a background colour.
There exist applications that expect both kinds of behaviour. Therefore, PuTTY can be configured to do either.
With this option disabled, screen clearing is always done in the default background colour. With this option enabled, it is done in the current background colour.
Background-colour erase can be turned on and off by control sequences sent by the server. This configuration option controls the default state, which will be restored when you reset the terminal (see section 3.1.3.6). However, if you modify this option in mid-session using ‘Change Settings’, it will take effect immediately.