[n3k5]

The latter — each edge is parallel to one of three coordinate axes (X, Y, Z), which forces angles between different edges and surfaces to be multiples of 90 degrees. They don't need to be on a grid, just parallel to one.

One way in which this simplifies things, for example, is checking whether two boxes overlap: They do so exactly when there is an overlap on each axis. (E.g. you look at them from the front, side, and top, and there is no gap between them. This test wouldn't be sufficient if they could be rotated arbitrarily.)

The original Quake levels make use of this: a lot of things have an invisible axis-aligned bounding box (i.e. a cuboid just large enough to contain them) around them. Before checking for an exact intersection, the much cheaper test for the AABBs is performed first. This is useful even when only one of the objects tested is approximated in this way; the other one could be a bounding cylinder around a player/enemy, or a surface in the level geometry.