The image of God in which man was and is made has been variously explained in detail. Although scholars may differ on the nuances of the phrase, there is general agreement that it has to do with dignity, destiny, and freedom.
The assertion that man is made in God's image shows each man his true dignity and worth. As God's image-bearer, he merits infinite respect. God's claims on us must be taken with total seriousness. No human being should ever be thought of as simply a cog in a machine, or mere means to an end.
The assertion points also to each man's true destiny. Our Maker so designed us that our nature finds final satisfaction and fulfillment only in a relationship of responsive Godlikeness which means, precisely, that state of correspondence between our acts and God's will which we call obedience. Living that is obedient will thus be teleological progressively realizing our telos (Greek for "end" or "goal").
Also the assertion confirms the genuineness of each man's freedom. Experience tells us that we are free, in the sense that we make real choices between alternatives and could have chosen differently, and theology agrees. Self-determining freedom of choice is what sets God and his rational creatures apart from, say, birds and bees, as moral beings.