I have heard the term mentioned many times in seminars, and in papers on remote sensing. What does it mean? References would be helpful if available.
In remote sensing you often do not directly measure the variable of interest, i.e., you measure it via some other variable that you can measure (depending on the type of instrumentation). The model function is simply the function which relates the observed variable to the variable of interest, just like y=f(x).
E.g., y could be wind speed, and x the energy measured by the scatterometer.