The new command allows you to create a brand new repository.

Pragmatically, this means that an SQLite database is created with whatever name you specified, and set up with the appropriate tables and initial data.

There's not much to new, it's what happens afterward that gets a project going:

Once you have a new repository file, you need to create and cd to a directory in which you will store your files, or move into an existing directory which contains the files for a project.
Then, you need to open the new repository, and get the server running so you can set up the project name and so forth.
Finally, you'll add files to it. If you are adding exisiting files, you can add them individually, via globbing from the shell, or by adding the directory (which will add all of the directory's file-system descendants recursively.)

But you can't do all that until you create a repository file with new.

See also: fossil open, fossil add, fossil ui, Reference