Opacity is how translucent something is.
When something is fully opaque, you can't see through it.
Opacity is usually defined by a value from 0 to 255, where 0 is invisible and 255 visible, opaque. A value of 128 would in that case be almost half visible, translucent.
In the Source and Goldsource engine, specific issues prevail when using translucent textures. The software(hardware?) utilized is sometimes bad at sorting what should be rendered first. Sometimes this is done incorrectly, and the hardware then render other things over the translucent texture.