Mixed ability as used in ELT usually refers to the differences that exist in a group in terms of different levels of language proficiency. This might be a result of simply the amount of time they have spent learning, their different language learning abilities or learning style preferences. Almost all groups are mixed-ability.

Example
A teacher has a large intermediate group of mixed ability teenage learners - some learners are actually pre-intermediate, a minority are intermediate, and a small number should be in an upper-intermediate level.

In the classroom
Teachers need to have a range of strategies for managing mixed ability classes. Extension tasks for fast finishers, differing levels of difficulty on tasks that work towards common aims, and putting learners of different levels together for some activities, and apart for others are all possible strategies.