In simple terms it is an accurate measurement of the water repellancy of a material.
Rain resistance is measured as a hydrostatic head in millimetres (mm). This indicates the pressure of water needed to penetrate a fabric. This is simulated, in a simple way by placing a wide tube onto a piece of the fabic to be rated. Water is steadily added until it forces its way through the material. Just before this is the hydrostatic head.
There are lots of factors that affect the Hydroststic Head, heavy or wind-driven rain has a higher pressure than light rain, standing on a groundsheet increases the pressure on any water underneath, the pressure of rucsack straps on a jacket increases the pressure on the shoulders and so on..
Fabric with a hydrostatic head of 1000 mm or less is best regarded as shower resistant, with 1500 mm being usually suitable for summer camping. Tents for year-round use generally have at least 2000 mm; expedition tents intended for extreme conditions are often rated at 3000 mm.
Where quoted, groundsheets may be 5000 mm or more.