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Curtains are draped on many windows inside the game world. They hide light and movement from any zombies which may be lurking in the vicinity, making it far easier to go undetected when hiding in a safehouse. Some houses have windows that already come with curtains. However, most windows don't have curtains on them and curtains must be added manually.
For windows without curtains, sheets can be placed over them. With a sheet in the inventory (not in a bag), right click on a window to place the sheet. Or drag the sheet to a window and click. Sheet curtains behave slightly differently than standard curtains. By default they cover half of the window, and in the lowered position will cover the entire window. However the same mechanic applies: simply highlight the curtains with your pointer and click to lower or raise them, or right click the window to bring up the drop down menu. Bedsheet curtains may not look as stylish as regular curtains, but they get the job done.
By right clicking a Window you can open a drop down menu, if the window has a sheet or curtain attached, you can remove it.