First, let's have a look at the most famous guitarist of the 20th century, Andres Segovia:

The key points are that the guitar rests on the left leg, and the left leg is raised a little by placing the left foot on a footstool. There are two main benefits of this posture:
1. It raises the guitar high enough to allow the left hand good access the full range of the finger board.
2. It frees the left hand from having to support the guitar, so the left hand and arm can move freely.
(There can be a few drawbacks to this posture, however, depending on your physique or physical condition. We'll get to these later.)