Each little quartet of L's represents one function. The L in the upper left position specifies the image of an upper-left type L, and so on. The functions are themselves arranged in quartets; within each quartet, only the mapping of the lower right L varies. These quartets of functions are further arranged into larger quartets in which the mapping of the lower left L also varies. A similar process produces the next two levels of the hierarchy.
The figure was produced by a Scheme program, running under Scheme 48, that generated Postscript code. Ghostscript interpreted the postscript to make some kind of bitmap (I forget), which "xv" converted to a GIF.