Streaming: placing students into one group for the entire school day, based on ability.
Setting: placing students in one group for each subject based on ability in that subject, rather than general ability.
Banding: putting students into groups for all lessons, and given different choices depending on ability (i.e. less GCSE options for lower-achieving students).
This idea links heavily to labelling- the idea that being perceived to do less well eventually leads to actually performing worse than you were able to.