A hard fork loosens or changes the rules in a way old software will not accept. If everyone upgrades, the chain simply continues with new rules. If a meaningful group refuses, the network splits into two chains sharing history up to that block.
For holders, a contentious hard fork means your balance exists on both chains. That is not free money: the combined value usually settles below the pre-fork value, liquidity on the minority chain is thin, and claiming can expose keys if done carelessly through untrusted tools.
Example: hold 10 coins worth $100 each before a split. Afterwards you hold 10 on each chain at $92 and $6. Your $1,000 is now $980, and the $60 side may be hard to sell at any size without severe price-impact.
Related: soft-fork, chain-split, full-node