It's a variation on the classic Battleship game, mostly played in the same way as normal.
There are possibly two versions as the patent for the game (US2058079) describes a different layout to the one that I've encountered.
I use Battleships as a teaching tool in my English Foreign Language classes, so I've developed a simple way to teach the game to my teenage students. I'd recommend breaking the game into steps, something like this:
Start with a real world example. "This is a game about ships at sea. They can't see each other, so they use maps to try and hit their target."