If you look at earlier 3D games, you'll find that many of the environments are very sparse in terms of props placed about to create a sense of familiarity. As processing power and fidelity improved, so too were environment artists and level designers able to create environments where visitors could feel the spaces were more lived-in and believable. This kind of believability is the bread and butter of level designers and environment artists.

Imagine you were trying to create an office in 3D space. The simplest office typically involves placing desks and chairs about a room, with some windows perhaps. Maybe a bookshelf, or a file cabinet. That sounds like a typical office, right? But if you think about any office you've been to, there's a lot of smaller details that are missing.

There are cubicle walls. There are wall decorations. There are light fixtures. When you think about those details, there are even smaller details - cubicle walls are often decorated by the cubicle's inhabitant. Desks are rarely completely bare, but there are often other items on the desk - writing implements, loose papers, a desk lamp, a computer monitor, a coffee mug, perhaps remnants from someone's lunch. The office kitchen should have a water cooler, a coffee machine, a bunch of cabinets, maybe a table with some chairs in it, a refrigerator maybe.

Then we can start adding additional variations to the scene. Instead of everybody in the office using the same chair, maybe we have some different types of chairs. Maybe we have different varieties of desk, filing cabinets, computer monitors, wall decorations, cubicle walls, and so on. Beyond this, we can even do some [ambient storytelling] - placing objects specifically to hint at events that happened in that space. The only limitations are the technology, the amount of dev time we can get from prop artists, and the allotted schedule time we're given to iterate on the environment design. We can potentially go infinitely into the details of the environment creation, so we stop when we hit any of those hard limits.

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