by 
The Curious Bag
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Between the advent of distributor-less ignitions and the now-antiquated points-style distributors lay the ignition module. This device forms the crucial link between old-school mechanical distributors and modern electronic ignitions.
History
The first ignition module to reach production cars debuted in the early 1970s and was based on an aftermarket offering by Pur-Lux (now Pertronix).
Function
An ignition module is installed inside of an engine's distributor cap. It uses a magnetic Hall Effect sensor to determine cam position and fire the ignition coil.
Significance
Electronic ignitions modules are a huge improvement over old points-style systems, which often began to misfire as low as 5000 RPM.
Effects
Ignition modules create a much more stable spark, and offer more tuneability than points ignitions. This yields improvements in power production, fuel economy and emissions.
Failing Module Symptoms
A failing ignition module can be recognized by hard starting, stalling at speed, hesitation, power loss and an overheating ignition coil.
Source:
Britannica.com: Ignition Module
Pertronix Performance Products
DMV.org: Replacing an Ignition Module
Resource:
Video: Ignition Module Replacement
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