In addition to xflow7's answer:
Let's say we have the following users and groups.
User x1 has a file xxx whose permissions are 640, which means that user x1 can read and write to the file (the 6), and other users in his group can read the file (the 4).
Let's consider all files which, like file xxx, have permissions that allow all users in group xg to read them (-4-), write them (-2-), execute them (-1-), whatever. Let's suppose that, for purposes of accessing these files, user y1 should be an "honorary member" (that's my term, not a technical term) of group xg. If you add user y1 to group xg's line in /etc/group, he will now be such an honorary member.
The only additional permissions user y1 has received is to get access to files created by users in group wg, and only those files which have group permissions of some sort.