Displacement Tab

Displacement is a technique that uses a texture or height map to cause an effect where the actual geometric position of points over the textured surface are displaced, often along the local surface normal, according to the value the texture function evaluates to each point on the surface. It gives surfaces a great sense of depth and detail, permitting in particular self‐occlusion, self‐shadowing and silhouettes; on the other hand, it requires the most rendering time of this class of techniques owing to the large amount of additional geometry. A displacement map is a black/white map like a bump map and the gray values of this map represent how Thea should displace the mesh.

Displacement: Select the image that will be used as a displacement map.
Subdivision: Defines the times the actual mesh will be subdivided. Large values will create a more detail surface.
Height (cm): Defines the height of the displaced surface in cm. The maximum value will be used for the white areas of the displacement map.
Center: Areas with black mean no displacement and white 100% displacement (corresponding to the height you have ginen). This is true when center is set to 0, but if you change to 0,5 then 50% gray color of the displacement map will represent no displacement and when set to 1 then 100% white will represent no displacement (in other words it will displace the opposite way). This inverted displacement is sometimes useful, like for the ground plane displacement where you want to avoid intersecting with objects that are on the ground, as for example a car wheel that is on a displaced ground, so in this case you would set the center to 1.
Normal Smoothing: This option should be enabled for surfaces with smooth edges. For models with sharp edges (box, plane, etc) it should be disabled.
Tight Bounds: Helps to render faster but initialization will last longer. This is more preferred to have it enabled.

The following video is for Thea for SketchUp but same pronciples apply to Thea for Rhino.