A passphrase works like an extra word added to the 12 or 24 words that make up your recovery seed. As passphrases are not stored on your Trezor, when using the feature, your Trezor will ask you to enter the passphrase which will then be combined with the recovery seed (generated during Trezor setup) and a new unique passphrase-protected hidden wallet will be created. Any time you wish to access this hidden wallet, the exact same passphrase must be used.
This means:
When you use the passphrase feature, you can create wallets that are protected by the text you type in the passphrase dialogue (window).
You can create several passphrase protected wallets (1 unique passphrase = 1 unique wallet). The original passphrase-less wallet can be always accessed by clicking on the "Standard wallet" option in Trezor Suite.
Passphrase protection is an advanced feature and must be used carefully. Each passphrase needs to be typed precisely, as by "mistyping" a passphrase you will (inadvertently) create a new passphrase-protected hidden wallet.
For example, if you choose the passphrase "TrezorSafe3ProtectsMyBitcoin", this wallet can be accessed only when the passphrase is entered exactly as it is written here; if you mistype even a single character (e.g. "Trezorsafe3ProtectsMyBitcoin") or accidentally include a space (e.g. "TrezorSafe3 ProtectsMyBitcoin") then you will create an entirely separate new wallet under a new passphrase. Remember, every character counts and passphrases are case sensitive.
If you have passphrase enabled, after entering you PIN and unlocking your device you will see the following prompt in Trezor Suite:
After entering your passphrase to access your hidden wallet, Trezor Suite will ask you to confirm the passphrase on your Trezor device and it will then check the account balances.
If the passphrase is incorrect, it will ask you to confirm that the wallet is empty.
After entering your passphrase to access your hidden wallet it will ask you to confirm the passphrase on your Trezor device again. The account will then be loaded in Trezor Suite.
All wallets, accounts and addresses are derived from a unique combination of recovery seed and passphrase, so if one of them (or both) differ, then the private keys differ as well and a new wallet, accounts and addresses are derived.
Also note that by using the same combination of recovery seed and passphrase, the same wallet with identical addresses is derived - no matter which application is used: