This marks the boundaries of the life zone, the area in which a terrestrial planet might be a friendly place with liquid water. For an Earth-sized planet, the inner limit is supposed to be at about 0.95 AU. This is quite close to Earth's orbit, but that makes sense, considering that the Earth does not have very much carbon dioxide in its atmosphere (just 0.035%, and that is not that much). The outer limit is farther away from us, perhaps at 1.6 AU (a bit outside Mars's orbit). If Mars had Earth's size, it would have as much liquid water as Earth, and it might have a breathable atmosphere (if life had created oxygen there; though it would have much more carbon dioxide, perhaps up to 1% -- we would feel that Martian air was quite stale). (Note that the average distance is important. It does not matter much (except that it would of course affect seasonal temperatures) if a slightly eccentric orbit (like that of Mars) grazes the limit of the life zone, as long as the planet orbits within it most of the time.)

For different planet sizes, these limits might differ. The smaller the planet is, the narrower the life zone becomes, because the outer limit moves inward. (The planet, being smaller, has a thinner atmosphere and is therefore colder.)

With another sun, the limits are moved according to the star's luminosity. Now, there is a problem with small stars (those with less than a few percent of solar luminosity). In these cases, the life zone will be both narrow and close to the star. If there is a planet close enough to be in the life zone at all, it is likely to be tidally locked, i.e. it always turns the same side towards its sun, having a seering hot and an icy cold hemisphere. It seems deliberately unlikely that a stable atmosphere develops there.

So we can specify the kinds of places where we would want to look for life. It's terrestrial planets (or moons) of sufficient size, orbiting within the life zone of a sun-like star (i.e. a main sequence star of spectral type F5 or `later', with a luminosity between 10% and 300% of that of our sun).

It is, as to now, entirely unknown how likely biological evolution on such a planet is. The only example we have at hand is Earth, and one of the first things they teach you in a statistics course is that you can't conclude anything from a single example, other than that at least one case of the observed properties exists.

It is also unknown how many special conditions must hold to allow biological evolution. Our large moon doubtlessly improved the conditions for life on Earth. Its strong tidal forces stirs up the Earth's interior, which results in an augmentation of the Earth's magnetic field which serves as a shield against hazardous radiation from outer space. The same forces also create the ocean tides which, to some biologists, played a major role in the evolution of life. But it is unknown whether these things were necessary or not.