As David noted, since the summands aren't in general integers, it's difficult to give a combinatorial interpretation to the formula. However, if we multiply by $a$ or $b$ we get integers and we can give a combinatorial interpretation to the identity that we obtain (though doing this destroys the symmetry between $a$ and $b$).

If we multiply by $b$, the sum may be written
$$\sum_{k=0}^a (-1)^k \binom{a+b-k-1}{a-k}\binom{b}{k}.$$
This is a special case ($m=a+b-1$) of the more general identity
$$\sum_{k=0}^a (-1)^k\binom{m-k}{a-k}\binom{b}{k} = \binom{m-b}{a},$$
which we can prove combinatorially. (Incidentally, this identity is a form of Vandermonde's theorem.)

To prove this formula, we start with a set $M$ of size $m$, with a subset $B$ of size $b$. To interpret $\binom{m-k}{a-k}\binom{b}{k}$, we choose a $k$-subset $K$ of $B$ and then choose an $(a-k)$-subset $C$ of $M-K$. The right side $\binom{m-b}{a}$ counts pairs $(K,C)$ in which $K$ is empty and $C$ is an $a$-subset of $M-B$. To prove the identity, we find an involution on the set of pairs $(K,C)$ not of this form that changes the parity of $|K|$. The pairs $(K,C)$ to be canceled are those in which $K\cup C$ contains at least one element of $B$. Then the involution moves the smallest element of $(K\cup C) \cap B$ from $K$ to $C$ or from $C$ to $K$.