An overlay could define a package with the same name as one from a lower level.

IE python = super.python...

It could also completely override the entire definition of something if you wanted.

IE python = super.stdenv.mkDerivation { ... };

But you can also add new names, and not modify the existing definitions.

IE python-for-me = super.python.overrideAttrs (...);

In the last case you can reference your modified copy while other things in nixpkgs can use the one built upstream.