It usually shoots an anti-tank / anti-vehicle grenade.
It saw wide usage during the Vietnam war and became popular in other countries also, until U.S. stopped it's production in 1983.
It was than resumed in 2011, during the so called 'war on terror' (Afghanistan and Iraq). Re-starting production of older weapons is quite a rare happening in firearms history, which must be read as proof of the tactical value of this kind of weapon.Hope. Podovsky's machine guns, Rambo lands it in the nearby river and feigns death. Podovsky arrives and falls for the feint, but before he can destroy the helicopter with a missile, Rambo pulls an M72 LAW rocket launcher and aims it through a hole in the windshield. Before Podovsky can react, Rambo pulls the trigger and it destroys Podovsky's helicopter.
An interesting fact is that the filmmakers decided to use the same shot of Rambo pulling the trigger on the RPG-7, although the M72 LAW does not have this mechanism.
Firing any type of rocket launcher indoors is a bad idea altogether. The backblast is so intense from an RPG or a LAW that it would kill everyone if you fired it in an enclosed space such as a helicopter, which means that the scene in the film was completely unrealistic. It would have killed Rambo, Banks and the other POWs in the process.