Azure Resource Group is part of the new management functionality in Azure called Azure Resource Manager which was not available in the old portal. They are basically like a container or logical group which can put together related resources of an application.
Have a look at the below screenshot in which I have created a Resource group called MyResourceGroup, with a cloud service, Virtual Machine, Virtual Network, and storage as resources.
All the resources mentioned above are the result of creating a Virtual Machine. Resource group will just bundle them logically together for a bunch of management tasks. It is easy to identify and manage the resource for an application which also helps you to analyze the cost for an application. Since it is tightly coupled, you can easily see them or visualize them together. Any resource created in the portal will be created in some resource group so it is a better practice to put all your similar resources in a group together.
It is possible to create a new resource group or to use an existing resource group in case of creating a new service.
If you delete a resource group, all the resources in it get deleted because all the resources are part of this resource group. So, you must be super careful when you delete a resource group in production. Everytime, make sure, you are not deleting anything you do not want to, and ensure that there is no dependent resource in your resource group with any other application.
If you are presenter of a session, you can put all your presentation demos in a resource group so that you can delete all in a single click after its scope. Resource groups are based on location so all the resources must be at same location to be part of the same resource group.
Another best thing about the resource group is that you can build the environment using templates. A template is simply a JSON file that declares the storage, networking, and computing resources. You can also define any related custom scripts or configurations to apply. By using these templates, you can create consistent, reproducible deployments for your applications. This approach makes it easy to build out an environment in development and then use that same template to create a production deployment, or vice versa.
Resource Groups also support role based access control where you can define different access to different team members in production or development environment.