In the context of phones, it's just what it sounds like: a block, or set, of numbers set aside for the use of a particular provider. It simplifies the process of giving out new numbers if you know that, for example, all the numbers in a given exchange (the "middle set" of 3 numbers that follows the area code) are reserved for you and no other provider can give them out.
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If you block someones number they are no longer able to call you from the number that you blocked.