Gray Water

The term grey-water is waste water from showers, washing machines, bathroom sinks, and water from flushing toilets. This water can then be treated and be reused without the odor or color typically associated with sewage. Gray water can be used in the irrigation of certain types of agriculture as well as in gardening.

There is grey water and there is black water.  Black water is from flushed tiolets with poop and pee in it; grey water is shower water and washing dishes water and perhaps bathing the dog or cat water.  You can route grey water out into your yard (don't get caught by the town fathers) for irrigation and cause no damage . . . not so with black water.

Gray water is typically "used water" from residential dwellings that has not been in contact with human waste (urine/feces).  Although not as foul as sewage, it can get some degree of septicity since it may contain various amounts of organic matter (such as from dishwater).  Most regulations categorize it as "sewage" and consequently ban it's use to be discharged in any other place but municipal sewage or septic systems.  In many states, wastewater may only be classified as industrial waste or sewage---nothing in between.  For example, gray water is classified as sewage (such as the Pennsylvania Clean Streams Law).  There would be little to no harm in reusing most gray water unless it contains large amounts of contaminants, such as cleaners, pharmaceuticals and food wastes.  I would reference the Clean Water Act or the EPA website for more accurate and descriptive definitions and further reading.