It usually refers to content available to both the Starfleet and Klingon factions, together with those allied to those factions (Federation-aligned or Klingon-aligned characters). The majority of content from Cardassian Struggle onwards is cross-faction, as are PvE Queues and adventure zones. Faction specific content tends to be limited to early missions and main faction hubs.
Standard starships (i.e. Federation and Klingon design starships) are limited to allied factions (Federation ships being usable by TOS Federation and Fed-allied Romulans) but not with their opposite major faction. However, this restriction can be removed with the purchase of the Cross Faction Flying Unlock, or by levelling any Klingon Defense Force character to level 65. Starships not specific to a faction (i.e. alien ships like those of the Vaadwaur or Ferengi) are usable across all factions by default.