This is my definition of 3 tier backlinks.
your money site <- Tier 1 backlinks <- Tier 2 backlinks <- Tier 3 backlinks
Tier 1 backlinks (post your most well written content on Web 2.0 sites like Wordpress.com, Zimbio, Ezine Articles, press releases) point towards your money site.
Tier 2 backlinks point to your Tier 1 backlinks (these can be Web 2.0's, article sites, bookmarks, blog comments, forum profiles - basically the same sites as used in Tier 1, with the exception that I don't care as much about the quality of the content. The point is to get your T1 backlinks indexed and some link juice.)
Tier 3 backlinks point to T2 backlinks and are the spammiest (thousands of Xrumer created forum profiles , Scrapebox blog comments, bookmarking on thousands of pligg sites...etc) Tier 3 is to get T2 links noticed. Your are hoping that G will crawl up the link chain, indexing all your links and ultimately giving all that link juice to your money site.
This is only a brief overview, many people (myself included) mix and match all of the above link methods in moderation on every tier, including the spammy links once we feel like the money site has a good link foundation and can handle junk links. It is part of link diversification.