The reputation system is complex and can have direct impact on character advancement. In World of Warcraft, there are many groups of NPCs known as “factions”. The two primary factions are the Alliance and the Horde, and each one features a large number of sub-factions primarily based on race and geographic location. Characters’ reputation with a faction can be increased or decreased by killing certain mobs, completing quests, or handing in items to certain NPCs. Higher reputation can grant many benefits to characters including reduced prices from vendors, the ability to purchase unique items including specialized mounts, and expanded access to certain areas of the game.

However, characters cannot gain reputation with opposing factions, so a Horde character cannot gain reputation with any Alliance-only faction and vice versa. There are also diametrically opposed factions in which gaining reputation with one will result in loss of reputation with another.

Content borrowed from wikipedia.org