From Daggerfall there were;
Merchants
Peasants
Nobles
Scholars
Underworld
and I would add Soldiers and Clergy to the list. So you take a quest to help steal a bank deposit from a store, if you're caught/seen/found out then your reputation with the local merchants drops and your price will be higher, but the local underworld would respect you more and might let you in on the next plan. If the peasants are getting disgruntled at a baron's farm, you might help the baron to quell the uprising. If you do it by beating the leaders into submission, your reputation with the peasants drops. If you can make both sides reach an agreement with your speech skills, you gain some reputation with both.
Daggerfall also let you change your social status with those groups during character creation, but gaining reputation with one group meant you had to lose it from another. Want to start the game with some enemies and some friends?