The 12th house represents your connection to the cosmos -- like your dreams, the unconscious and things that are kept hidden. Also, music and your ultimate karmic quest.
Anything that happens behind the scenes or under the surface is represented by the 12th house, ruled by dreamy, visionary Pisces. Abstract feelings of guilt, self-consciousness and paranoia are based here, as are enemies you may not even know of! It's ultimately the house of past lives and enlightenment.
Your birth chart is divided into 12 "houses" which govern specific areas of your life. At the time of your birth, each planet was located in a particular astrological sign and in one of the 12 houses.