Closing the lid of any MacBook automatically puts it into sleep mode. In order to continue using your MacBook even when it's closed, you have to set it up for what Apple calls "closed clamshell mode" or install a utility like NoSleep. To use closed clamshell mode, you need an external monitor or projector and either an external mouse or keyboard. NoSleep is a free utility that works with OS X Mavericks on any MacBook model.
Closed MacBooks and Sleep Mode
Out of the box, all MacBooks are designed to go to sleep immediately after you close the lid. OS X saves any open programs and their data to memory so when you open the lid they are exactly as you left them. When the MacBook goes to sleep, the processor goes into low-power mode, the hard drive shuts down and the display turns black -- including any external monitor. All card slots on the motherboard, including audio, Wi-Fi and Ethernet turn off. Power is also shut down to the USB ports, with the exception of the power key on a USB keyboard.
Using Closed Clamshell Mode
To enable closed clamshell mode on your MacBook, connect it to a power outlet, an external monitor or projector, or a peripheral, such as an external keyboard or mouse. To configure a Bluetooth keyboard or mouse, go to System Preferences, select "Bluetooth" and turn on the "Allow Bluetooth Devices to Wake This Computer" option. The MacBook automatically go into closed clamshell mode when you close the lid. The external monitor turns blue for a moment, then shows the MacBook's display.
Using an App
Several apps prevent a Mac from going into sleep mode -- something OS X can do itself in the Energy Saver section in System Preferences. Few of these apps work when the lid is closed, so it's important to read the product descriptions carefully before purchasing them. Two apps that should work are Sleepless and NoSleep (see Resources). Sleepless sells for $9.50. NoSleep, a free app developed by Pavel Prokofiev, is available from the Google Code website; it is not the app of the same name in the App Store. Both Sleepless and NoSleep are compatible with Mac OS X Mavericks.
Overheating a Closed MacBook
Whether you are using closed clamshell mode or a utility like NoSleep, ensure your MacBook has proper ventilation when the lid is closed. Heat that would normally escape from the keyboard area is insulated by the screen when the lid is closed. Consider putting your MacBook on a laptop stand to increase air circulation around it. Touch the case occasionally and if it feels warmer than usual, open the lid or power down the MacBook until it cools down.