From BR Bullpen
A two-way player is one who has the ability to both pitch and hitting, and to a lesser extent field. Thus the player allows a team to fill a roster spot with a pinch hitter, pinch runner, position player and pitcher with only one man. They also were very valuable in the early days of baseball, when rosters were much smaller and teams could not afford a large bench, or in leagues with similar limitations.
For a list of two-way players, see Two-way players.