#' is a frequently-used ReadMacro in CommonLisp. ("Sharp quote" because # means 'sharp' in MusicalNotation and ' is the QuoteOperator in Lisp.)
#'foo
expands to (is SyntacticSugar for)
(function foo)
Every symbol in CommonLisp can refer to both a function and a value. Since
foo
by itself refers to the value, we write
(function foo)
to refer to the function. The function special form is also used to create a LexicalClosure from a LambdaExpression. (A lambda expression may also be executed directly, but this actually macro-expands to the (function (lambda ... )) form.
In essence, all this means that function is a special form such that (funcall (function <whatever>) ...) evaluates to (<whatever> ...).
See SingleNamespaceLisp, FunctionLambda.