Gr.N is one of the FIA categories for rallying regulations. Group N is meant to be the basic level of preparation of a rally car. In the good ol' days when the regulations were introduced they were strictly normal road cars only modified to a very minimal extent to improve safety (they had a roll cage installed, bucket seats, a harness and a few more very minor modifications). Nowadays there are many more things which can be modified while still remining within the boundaries of what Gr. N allows. Namely you can now remove carpet, back seats, parcel shelf, replace door trims with kevlar panels and a bunch more stuff to lighten your car whereas previously you couldn't. Even some engine mods are now allowed to improve performance, like changing parts of the exhaust, and other minor stuff.
Since the introduction of the WRC extension to Gr. A, normal Gr. A cars have almost ceased to exist in top level rallying. The new regulations have made Gr. N cars almost as quick as what a 10 year old Gr. A car used to be. Take a an Evo 8 or an Impreza Gr.N and it is pretty much competitive as it comes out of the showroom. Now imagine lightening it by 100 kilos and getting the power up to 300 bhp (theoretical maximum allowed)...