Generally it means a ratio less than one, engine/trans rpm. My Chrysler has a 4th speed overdrive ratio of .69, so 690 engine rpm gives 1000 rpm at the trans output shaft. The axle ratio is 3.45, the ratio of trans rpm to wheel rpm. The final ratio is (.69)x(3.45)= 2.38 in OD. Saves gas and engine wear. Owners and service manuals can have the ratios for the gears, if one is interested in such things.
There is also lockup in the higher gears, which means the trans stops slipping through the torque converter, essentially becoming solid drive like a manual shift trans. That increases mileage as well. Watching the tach, at times, you can see these effects as they work.