src/
stands for source, and is the raw code before minification or concatenation or some other compilation – used to read/edit the code.
dist/
stands for distribution, and is the minified/concatenated version – actually used on production sites.
This is a common task that is done for assets on the web to make them smaller.
You can see an example here in Combine multiple JS files into one using JavaScript, Node.js and Grunt.