This is probably covered somewhere, but I haven't found it. What does it mean when an answer is "greyed out." The whole text of the answer. (The question itself not being greyed out, nor other answers to that question.)
Answers that receive an overall score of -3 or lower (I'm pretty sure -3 is the cutoff) will be grayed out due to the low score. The idea is that enough of the community thinks the answer isn't up to snuff so is semi-obscured by graying it out so other answers stand out more. Questions will also be hidden from the active page at -3 which is in a similar vein of thought.
Where this ends up making the most sense in general is when an answer is spam or rude or abusive and does not have enough delete votes to completely be removed. Graying it out makes a lot of sense in that case.