Similarly to the Conceal MonsterKeeper Spell, invisibility hides the caster from most enemies. This can hide the number of these creatures you have from the enemy as they train or research. As an invisible creature reveals himself as soon as he attacks, the ability has limited use in combat. Creatures will decloak with the use of any Creature Spell, including Invisibility itself, meaning you cannot "top up" invisibility while possessing a creature, making it more difficult and irritating while on a stealth mission.
Invisibility often does not work against the A.I. However, enemy thieves that have access to the spell use it to sneak past defenses and pilfer Treasuries. This is a particular problem of Chapter 18: Blaise End.