Trademarks get denied for all manner of reasons. In some cases, the government determines that the person who filed for a mark has actually stolen their design from someone else. In other cases, another party simply applied for the trademark first. The list goes on and on.
One common reason for denial, though, is the likelihood of confusion between trademarks. This is very important to the government, as the goal is to make sure that consumers are not misled in any way and that businesses have a chance to use their unique ideas, inventions and branding for their own gain.
One way that confusion could arise is when two different marks have the same general meaning, even when they are not identical. One example that the United States Patent and Trademark Office provides is if your mark contained the word "Lupo" and was stylized exactly the same as an existing mark with the word "Wolf." Their reasoning is that "lupo" means wolf in Italian, so, with the same stylization, there is clearly an attempt to mislead buyers or to make them think that the two marks are related.
Another example they provide is if a mark says "City Woman" while another says "City Girl." While technically different, if they appear too similar, the USPTO says that they "convey a similar general meaning and produce the same mental reaction." The trademark that is filed for second is seen as infringing on the first by attempting to use essentially the same idea.
If you are looking to get a new trademark or if you think yours are being infringed upon, make sure you know your legal options.