Well, placement should be a team decision, made by the school staff and yourself at an IEP meeting. You do get input into whether you think this is the right place for him. A big goal for kids is the least restrictive environment: where they can succeed best and be most integrated with typical peers. For some kids that means the regular classroom with some support, for others it can mean another classroom or another school.
Life Skills generally means a focus on what a child needs to learn to function in daily life, with the idea that these students won't pick up the skills on their own. Children in Life Skills classes typically are not able to succeed in other settings, and need intense help to learn activities of daily living. So a high school student in a Life Skills class may have a placement at a job site, where they practice work in a supervised setting with help (travel to a store and stock shelves, washing windows) or a class may work on understanding money or bus schedules. The positive thing about life skills classes is that when they are well run they are very functional, focused on what skills the children really and truly need to know, and they work on those skills long term. They are typically smaller classes, with more teachers and aides than mainstream rooms, and the children attending are probably receiving more therapies and showing greater delays than other students at the school.
I don't know if this is the right placement for your son. It would mean the main goal would be basic daily skills, rather than academics per se - those self help skills rather than science or history, like that. I would go into the meeting with a lot of questions. A lot depends on your son's age, and the reasons they think he would be unable to succeed in a different classroom. Labels don't count as reasons - they really need to give you an individual program, and you need to be comfortable that it's appropriate.
How old is he? Where is he at compared to peers, and how does he do in the classroom? Have you received a written assessment report from the school?