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Depending on machine setup, thermostats have differing roles. Essentially a thermostat is a switch based on temperature; as such they turn on/off at pre-determined temperatures. They are commonly used as follows:
In dual purpose boiler coffee machines, they are commonly used to adjust the boiler to the correct temperature range for either espresso or steam functions.. With another thermostat as an over-tempreture safety cutoff incase their is any kind of machine failure.
On heat-exchange and twin boiler coffee machines, they are commonly used as an over-tempreture safety cutoff incase their is any kind of machine failure. Not all machine have these as if there is a failure, machines have a safety valve to protect the boiler from exploding. They are also used to protect the element if the machine overheated due to a low water level, however most machines now have auto-fill probes which automatically refill the boiler with water when it runs low, hence reducing the need for these thermostats.