This is the kind of position where a little experience is helpful, so don't criticize yourself if you didn't understand it. Playing Nf4, even at the cost of a pawn, is a common theme in the Kings Indian. As llama45 pointed out, Black's Bg7 becomes a extremely powerful piece--all the more so because Whites dark-squared bishop is gone, and White's dark squares are weak after he's played c4 and e4. Check out this game between Kamsky and Kasparov. Kasparov said that Kamsky's decision to take on f4 at move 16 indicated that he didn't really understand the Kings Indian!
In the position below from my blitz game, the computer suggests 11... Nf4. I don't understand. Can't White just take the Knight, and what is my plan moving forward? Help me!!!