The event log lists major events that occur in town, from natural births and deaths, sicknesses, disasters, inventory warnings, and the arrival of nomads and merchants at trading posts.
Even if the event log isn't displayed, major events will be displayed next to the main toolbar.
Clicking on the popup arrow icon next to the events will focus the view on the event.
Using the button on top of the event log, you can enable and disable popup for various event types.