What is the significance of the line “Fair is foul, and foul is fair”?

In Shakespeare's The Tragedy of Macbeth, the audience hears the three witches chant these words in unison at the end of Act I, scene I. They have made a plan to meet Macbeth, and by saying "Fair is foul, and foul is fair," they are telling the audience that not everything is as it seems.
One example of something that seems "fair" but turns out to be "foul" is Macbeth himself, a war hero who turns murderer. One example of something that looks "foul" but turns out to be "fair" is the battle that took place as a result of the Thane's rebellion against the king; though the battle is bloody, it gives Macbeth the opportunity to impress Duncan, which makes for a fair situation for Macbeth.
This warning puts the audience members on the lookout for situations that might seem suspicious. This warning also contributes to the mysterious and supernatural nature of the witches, who do not communicate in clear language like the human characters in the play.