I ordered this module looking at the datasheet that it has a range of 2000m LOS distance. But now when I test it, I can receive signal from a maximum of 50m distance! It sends 2.4GHz signals. As far I understand, LOS distance means straight line distance. Am I making any wrong assumption about the datasheet?
Adding to what Connor Wolf said in the comments, transmitters have a defined maximum transmit power (usually measured in dBm or mW) whilst receivers have a defined maximum sensitivity. Together, plus several other factors, they form what is known as a "link budget". For instance, if you've got a 20 dBm transmitter and a receiver with a -60 dBm sensitivity, you can theoretically afford up to 80 dB in attenuation. Attenuation comes from many sources (connectors, cables, antenna matching, etc.), and the transmission medium as well (i.e., the air). They all might add quite a bit of attenuation. The data rate and modulation add to the equation as well.
After all that, if the antenna is perfectly omnidirectional (i.e., it irradiates in all directions like a sphere), the signal power will be distributed in all directions as well, diminishing its power rapidly in proportion to distance and other factors. If your antenna is not omnidirectional, however, it may "concentrate" the irradiated power in a cone shape, for instance, where all the power that would otherwise have been transmitted in directions you don't need is directed to the direction the antenna is pointed to instead. In this way, without changing the transmitting power you can reach farther, at the expense of not reaching every direction. The most extreme case would be a very very directional antenna, where you can transmit almost all the power in one specific direction. This is a very delicate setup and you need to point the antenna very precisely, because a little deviation from the line of sight (a small wind, perhaps) might mean lossing your target entirely.
Antenna directionality is usually specified in "dBi", which is how it varies from the point of view of an ideal dipole antenna, which has a known gain shape. An 8 dBi figure tells you that a receiver aligned with the most gain direction of the transmitter would receive 8 dB more of signal than it would receive if you have used a dipole. Not much. Mind that a receiver NOT aligned with the most gain direction would receive far less signal than it would from a dipole. That's how antenna directionality works: it takes from one direction in order to give to another.
The receiver antenna works in the exact same way, but backwards: if it's directional it concentrates its sensitivity in one direction, but becomes "deaf" to the rest.
Long story short, most RF modules specify the line of sight capability of the module with the most expensive and very carefully set up antenna, in a very specific situation which not adheres to your specific scenario. Some of them might include application notes specifying how, where and when the measurements where taken (things like weather affect the transmission too!). You might be inclined to think that this is a rip-off, but consider this: they don't know anything about your usage case; they couldn't specify what would be your results. There is no "common" scenario per-se: reflections (as buildings, objects, etc.) greatly affect the results. So, the most "honest" value (although I concede, misleading) is perhaps an ideal line of sight value.
Look at this link budget calculator for an idea of what is involved in the calculation.