When an SKU is 'tracking stock' for a warehouse, the amount available for customers to buy will be determined by what is physically in the warehouse, plus the amount expected inbound based on any existing Ship Notices.
Once stock has run out, the product will be unavailable to sell from that location.
Not Tracking Stock
If an SKU is 'not tracking stock' for a warehouse, the amount available for customers to buy can be set manually.
You can either set this value to zero, to prevent sales, or set a maximum number you wish to sell from a given location. Customers can then buy up to this amount, regardless of how much stock is in the warehouse or inbound.
The available quantity set should relate to the amount you can actually fulfil, and plan to deliver to your warehouse.