The diagram on the previous slide shows two environments: the user space and the kernel space.
The kernel space is the section of memory (RAM) in which the kernel performs privileged actions and services (recall the discussion about privileges.)
User space is any other memory section not belonging to kernel space.
Since the invoking of system calls is considered privileged, mostly since the abuse of system calls can damage the operating systems or corrupt data, system calls can only be performed on kernel space.
While a system call is executing, its parameters (usually, no more than 2-3) are stored on the CPU's registers.
If a parameter is larger than what a register can hold, the register will store a pointer to a memory location where the parameter's data is stored.