In kind of a nutshell (knowing me it will be more of rant). There are the stock classes like A-Stock (AS), B-stock (BS), C-stock (CS), etc. Cars are grouped by like performance. AS cars would be like S2000’s, STi’s, EVO’s, C4 vettes. FS holds all the pony cars and other large RWD cars. HS is for cars that were never ment for racing hehe. And SS (super stock) is the Elise, GT3, Z06.
Beyond that the rest of the classes are just different levels of modification. Street Touring classes (STS, STX, etc) means the cars are modded, but must remain on street tires. Street Prepared classes (ASP, BSP, etc) allow for more engine mods, bigger wider wheels, more suspension trickery, etc. Then come the Mod (AM, CM, etc) which are usually small formula cars or homebuilts. With the exception of Street Mod (SM) which is kinda like a catch all class for road going cars. And Prepared (XP, CP, etc) where most the cars have the unibodys and thats about all. Usually fully built engines, forced induction, removed head & tail lights, pretty much whatever you can think of.
Its a little more in depth in that, but thats kinda how it works. For example I run STS. Which means I run on street tires, can pretty much do anything with the suspension, but have to keep the motor limited to just basic bolt-ons. If I added race tires, or changed the intake manifold, I would move up to a Street Prepared class (CSP for me I think). If I were to swap engines and/or add boost, remove my back seat I would bump the whole way up to SM.