If you confine attention to inertial frames of reference that are in relative motion with respect to one another with velocity v, then the equation simplifies to ##\Delta \tau=\sqrt{1-\left(\frac{v}{c}\right)^2}\Delta t##. Imagine that you have a single observer with a clock that is at rest in his frame of reference, and measures the time interval between the two events ##\Delta \tau##. Imagine that this observer is moving with velocity v relative to a (stationary) group of observers strung out along the route from the first event to the second event, and the two observers physically present at the two events write down the times on their synchronized clocks at which the two events occur. They then get together and compare notes, and, when they do, they find that, according to their clocks, the time interval between the two events is ##\Delta t##. The equation above will tell you the relationship between ##\Delta \tau## and ##\Delta t## (which will not be the same).