If it's in the folder 'previous iTunes libraries' then it's fine.
That file is where iTunes stores lots of information about your songs, for example the play count of a song, the date last played, and other information which can't be stored inside the actual song file itself. Playlists are also kept there...
As I say though, it's in your 'previous iTunes libraries' folder, so it should be fine to delete. Try deleting it, but don't empty the trash, and then open up iTunes. If everything seems normal, then you're safe. If not, then put the file back where it was and pretend nothing ever happened