It is said to a male. "It" refers to his private parts. It is said when the male tries too hard to have sex, usually with multiple women. "He's had an affair with at least one secretary in the office . He really needs to keep it in his trousers."

We usually say "Keep it in your pants." And yes, it does have a sexual meaning. It means to control yourself, stop being promiscuous, and such.

You'll learn this stuff when you get to high school.