Retina is a commonly used word to describe displays with high intensity of pixels. Regular displays are 72 pixels per inch, while Retina is about 200-300 pixels per inch. Images need to be treated in a special way, so that they look sharp on this kind of displays. Time Theme does that, so your site and its content looks perfect on iPhones, MacBooks and new smartphones.
If you don’t care about that, you don’t have to, it’s not mandatory. But if you do, you just need to upload enough high quality images, and the theme makes rest of the job for you.