According to Dictionary.com, when (sic) is used in a sentence it denotes that a word or phrase which may appear strange or incorrect has been written intentionally. It can also denote a direct quote and thus it is not a typographical error.
Sic is used to show that something hasn't been changed from the way it appeared in the original source. It's used to point out things like spelling errors. You can learn more at http://www.ask.com/wiki/Sic.