At eight bits each channel has two hundred and fifty-six steps from dark to light, enough for the eye in a finished image. Sixteen bits give far more steps. The difference shows in smooth transitions: a background sweep, the falloff of a shadow, the sheen of satin. When too few steps cover a gradient, it breaks into visible bands, an effect called banding or posterisation.
Strong edits spend steps. Lifting the shadows of black fabric or making a large colour correction on an eight-bit JPEG stretches the remaining steps apart, and bands appear. Raw files and sixteen-bit working files keep room for such edits. The finished image goes back to eight bits: JPEG holds nothing else, and a sixteen-bit PNG is heavy and is converted or refused by some upload systems.
Specifications count bit depth in two ways: per channel, or for all channels of a pixel together. An ordinary RGB image is therefore described as both eight-bit and twenty-four-bit, and thirty-two-bit usually means the same with an alpha channel added. Bit depth says nothing about sharpness or size; it is not resolution. Where a gradient bands after export, a light noise or dither setting smooths it.