The first thing to note is that it is a law which still exists very much today. If ever you spot this particular piece of text chiselled out on a wall in the country, it will probably be on a public sector building, more often than not a school. What does the message mean though? 'Défense' in this sense means 'it is prohibited to', and 'afficher' relates to the sticking up of advertising posters. The law therefore was introduced to limit the places where such posters could be placed. This though was far from being the principal subject of this particular law.
The Loi du 29 Juillet 1881 is in fact more closely associated with the freedom of the press. It is only the third chapter that concerns the displaying of posters on walls, and yet this short addition to the bill has ensured that it remains one of the most visible laws in France today. The text is the following;
"Dans chaque commune, le maire, désignera, par arrêté, les lieux exclusivement destinés à recevoir les affiches des lois et autres actes de l'autorité publique" (In each town, the Mayor will decide, by decree, the places which will be used exclusively to display papers describing laws and other acts of public authority).
In more revolutionary times, the public authorities needed to ensure that laws were clearly visible and understood by the people, and also to ensure that unofficial messages were kept off the city walls. It also became an offense to damage any such officially displayed texts, and tearing one today could still get you a stiff fine.
The law gave the press unprecedented freedom to print what they wanted, but at the same time dictated that journalists and editors would become legally responsible for the stories they wrote. This meant that if an article was printed which was seen as inciting people to act unlawfully, or which could be seen as defamation, the journalist and editor would subsequently be tried and punished. No longer could the government repress newspapers they didn't like or prosecute for 'crimes of opinion', but the greater responsibilities given to press people has ensured that even today they err on the side of caution before publishing.
Truly a law which has left a lasting trace on the face of French society!