If one input is high and the other is low, then the NAND gate attached to the "low" input will see at least one "low" signal and thus output high. The other NAND gate will see two "high" inputs and will thus output low. If the input that had been low goes high, its NAND gate will still have a "low" input [from the other NAND], and its output will thus remain high. The other NAND gate will continue to see two "high" inputs, and its output will remain low.
It might be helpful to draw out a truth table whose input side includes the outputs of the NAND gates as well as the two main circuit inputs.
S R Q !Q -> Q !Q
L H x x -> H L
H L x x -> L H
H H H L -> H L
H H L H -> L H
L L x x -> H H
H H L L -> H H *
H H H H -> L L *
In some of the lines of the table, the states for Q and !Q are marked with x rather than H or L. That means that if the other inputs have the indicated values, the behavior of the circuit will be unaffected by the ones marked with x's. Note also that I have marked two lines of the table with asterisks. All the other lines of the table either direct Q and !Q to output something which is independent of what they're currently outputting, or else output the same things as they're currently outputting. Either situation represents a stable state, and there can thus be no uncertainty about what the circuit should, or will, do in such cases. The two lines marked with asterisks, however, are different. They indicate that if both outputs are high, they should both be low, and if they're both low they should both be high. These represent unstable states, and it's unclear what exactly the circuit will do. If one of the inputs changes before the other, the circuit might then behave as though the inputs were HHHL or HHLH, and assume a stable state. Alternatively, since an output which switches from high to low or vice versa will briefly pass through an intermediate state (let's call it Middle), would be possible that a NAND gate where one input is High and the other is Middle might output Middle, in which case one could end up with both outputs sitting in an awkward Middle state.
In practice, most NAND gates, given a "Middle" input, will tend to output high or low, but their output will switch much more slowly than if their inputs were at valid logic levels. The net effect is that if at some time the circuit is in an HHLL or HHHH condition, it will eventually settle into either an HHHL or HHLH condition, but the time required for that to happen could exceed by orders of magnitude the circuit's normal switching time.
The reason the state with SR both low is marked as "forbidden" is that if at some point in time the circuit is in one of the well-defined states, the only way it can go into one of the "murky" states will be if S and R are both low either simultaneously, or so close together as to appear simultaneous. If one doesn't allow that to happen, one won't have to worry about what the circuit will do in its murky states.