What does the two-second rule refer to?

The two second rule is a way to estimate a safe following distance between your car and a car that you are following. Pick a spot on the road, perhaps a sign. When the rear bumper of the other car passes that spot, start counting one one-thousand, two one-thousand, etc. i.e. count the seconds between his bumper and yours. If that time is less than two seconds, then you are following too close.

It does not matter what your speed is, because counting time will cancel out the speed. The official rule is one car length per 10 miles per hour. Assuming a car length is 20 feet, this translates to 1.4 seconds. Two seconds simply gives you an appropriate margin of error.