What is SeeAllData in salesforce?

CASE 1:

==>seeAllData=true 


If we are defining a test class with @isTest(SeeAllData=true) then we can access data in test class from database under all method present in test class.Under this case annoting a method with @isTest(SeeAllData=false) would be ignored and you can access database data inside this method as well. 
Let's understand with an example. 

@isTest(SeeAllData=true) 

public class testclassexample { 

static testmethod void testMethodFirst() { 


contact obj = [SELECT Id, Name from contact where name='test' LIMIT 1]; 
//Accessing contact from database 


} 

@isTest(SeeAllData=false) 
static testmethod void testMethodFirst() { 


contact obj1 = [SELECT Id, Name from contact where name='test' LIMIT 1]; 
//Accessing contact from database although @isTest(SeeAllData=false) is applied for method but it will get ignored 
as test class is having @isTest(SeeAllData=true). 


} 

} 

Case 2:

==>@isTest(SeeAllData=false) 

If we are defining a test class with @isTest(SeeAllData=false) then we cannot access data in test class from database under all method present in test class.Under this case annoting a method with @isTest(SeeAllData=true) would not be ignored and you can access database data inside this method. 
Let's understand with an example. 

@isTest(SeeAllData=false) 

public class testclassexample { 

static testmethod void testMethodFirst() { 

//You cannot access like this now. 
contact obj = [SELECT Id, Name from contact where name='test' LIMIT 1]; 

//You need to create test data 
Contact obj=new contact(); 
obj.name='test'; 
insert obj; 

} 

@isTest(SeeAllData=true) 


static testmethod void testMethodFirst() { 


contact obj1 = [SELECT Id, Name from contact where name='test' LIMIT 1]; 
//Accessing contact from database although @isTest(SeeAllData=false) is applied for class but it will get ignored. 


} 

}