No worries! It's a term that was thrown around a lot at my school, and I had only the vaguest clue of what it might mean when I first got there.
Here's an article that will probably do a better job than I could here:
http://www.massagetherapy.com/articles/index.php/article_id/53
Oh but after skimming it, I want to expand
Holding space isn't just for grief work, though. And more than just a way of paying attention to a person, it can be a way of holding the possibility for things to be different. I like to hold a very large space for all my work, including relaxation massage, because it allows more possibility for healing, whatever that looks like, in ways that can surprise both the therapist and the client.
It's also not just something you do with a person when you're with them. You can hold space for a sick relative to get well as you go about your daily life, or for the US domestic policy to turn around, etc.
The article talks about holding space somatically, mentally, spiritually, and emotionally, and touches on energetically. Only mentions the 4th & 6th chakra though... I prefer full-body holding of space that includes strong connections in the 1st & 7th... i.e. alignment between the earth and the divine.
Another energetic aspect of holding space includes "sealing" the physical space energetically. Wiccans who've ever "cast a circle" have experience in this. Others do it with Reiki, or angelic work.
And a less woo-woo aspect of holding space comes in to play when teaching or leading a workshop: how well do you hold the space in which your participants learn? Do you start and end things on time? Do you create a safe atmosphere at the beginning with group agreements, confidentiality, whatever is appropriate for your work? Do you hold deep enough space for your participants and activities to go deep, or do things stay on a lighter level?
So I suppose holding space can mean different things, from simply being present & non-judgmental to a full on form of energy work in its own right. It's for anyone, whether they add the energetic component or not; can be completely "Western/rational"... or... not.