Some examples of "naked light":
- welding arc
- flame/fire
- operating an unprotected electric motor
- using any type of tool, etc. that could cause sparking
- a light that's not contained in a gas-tight enclosure
Signs such as the one you saw are generally posted in environments where the items listed above could cause an explosion.
Probably doesn't match the visual that you had!!! Hee-hee!
Bill