Tiers refer to two things. When relating to your progress through the game, each Crew forms one Tier - Tier 1 is made up of the Nu Fangz, with other crews making up tiers 2 – 5.
When talking about cars, the Tier refers to the limitations placed on each car. At the top center of the screen you’ll see the car’s Tier – eg T4. This is the Tier of your current car. As you browse the showroom you’ll notice the Tier changes depending on the car you have selected.
As a rule, you can only use cars in the Single Player tier they’re rated for or higher – for example, a T4 car can only be used in Single Player tiers 4 and 5 – although there are some exceptions to this, like Regulation Races.