The purpose of the Set Subnetwork State tool is to make a subnetwork either active or inactive. An inactive subnetwork is ignored when a Scenario is computed, which will both speed up the compute process, and reduce the number of User Notifications, because fewer elements are considered.

The tool works by setting the "Is Active" property for the Drainage elements in the subnetwork to True or False. It therefore replicates existing functionality, but in a more efficient way, because it finds all elements - such as nodes, links and catchments - that are part of the subnetwork, and edits their state in one operation.

There are also icons on the context sensitive toolstrip, if a node at the end of a subnetwork is selected:

AND

The tool only checks the "Is Active?" state of the subnetwork outfall node - It does not check every element in the subnetwork. This is because it's possible to have a subnetwork with elements in both the active and inactive states, so the tool therefore works as a simple toggle for all of the elements in the selected subnetwork.