When a Dwarf goes to war he carries the honour of his clan and his hold with him. It is a matter of personal pride that he will do them credit or not return at all. To demonstrate his intent he will take an Oath stone with him. This is a carefully sculpted plinth on which the lineage and the deeds of the owner are carved. By standing atop an Oath Stone, a Lord or Thane will increase the resolve of his followers and ensure that all foes can find him in a scrum.
Source: Warhammer Armies Project: Unofficial 9th Edition (v2.2)
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A unit that contains one or more models with an Oath Stone can never choose to flee as a charge reaction, cannot be disrupted and, if any of its models are armed with hand weapon and shield, they can make Parry saves against attacks made to their flanks and rear. In addition, the presence of the stone with the unit confers Magic Resistance (1) as its runes act to absorb wild magic. Furthermore, a character with an Oath Stone must always accept a challenge. However, if a model on an Oathstone fails a Break Test, he is removed as a casualty as he fights to the very last.