Completion is invoked when you type either of the two control characters. The completion function takes the path string to ...

Completion is invoked when you type either of the two control
characters.  The completion function takes the path string to the left
of the cursor appends a wild card character to it if none is already
present and builds up a list of paths that match.  It then displays the
first matching path.  If no paths match, it just beeps and leaves the
display alone.  Thereafter, repeated pressing of the same control
character will cycle through the list of matching paths.  Pressing the
Shift key with the control character will move through the list
backwards.  If you edit the line in any way and press the control
character again, the saved list of matching paths is discarded and a new
one generated.  The same occurs if you switch between file and directory
name completion.  The only difference between the two control characters
is the file completion character matches both file and directory names,
while the directory completion character only matches directory names.
If file completion is used on any of the built in directory commands
(CD, MD or RD) then directory completion is assumed.

The completion code deals correctly with file names that contain spaces
or other special characters by placing quotes around the matching path.
Also, if you back up, then invoke completion from within a line, the
text to the right of the cursor at the point completion was invoked is
discarded.

The special characters that require quotes are:
     
     ()[]{}^=;!%'+,`~