The NSFW filter plugin allows users to toggle the visibility of files marked as NSFW in Obsidian. By moving such files into a designated NSFW folder, users can hide them from view when sharing their notes. The plugin helps protect personal or sensitive content from being displayed publicly. It automatically saves the original location of files and can toggle them back and forth between the main vault and the NSFW folder. This functionality is ideal for users needing to manage sensitive information without compromising privacy in shared environments.