Engine oil serves many useful purposes. The first is that it creates a film between metal surfaces which reduces wear. The second is it acts as a rust inhibitor by neutralizing acids and by keeping additional moisture away from key engine components.
Since the combustion process required to keep your engine running causes heat, motor oil helps transport that heat away to an oil pan where it can cool before being recirculated back through the engine.
Engine oil has one more purpose and that is to clean the motor. It contains detergents that help minimize the build-up of sludge and that isolate harmful carbon particles.
Oil becomes contaminated over time, and when that happens it can break down and become ineffective. Signs of its ineffectiveness may show up in one of the ways listed above.
It's a good idea though to bring your car in for an oil change at regular intervals and before any of these signs appear.