What does Matthew 25:32 mean?

Jesus is describing His return to earth as Judge and King (Matthew 24:3). The waiting will be over. All who trusted in Christ and served Him will be vindicated. Everyone alive on earth will answer to Him as the Judge of all, as He sits on His glorious throne with all power and authority to decide the fate of those subject to judgment (Matthew 25:31).

Scholars and traditions differ on who will be included in this judgment. The term "nations" is used in the Bible most often as a reference to Gentiles, or non-Jews, in distinction to the nation of Israel. Some suggest the judgment depicted here will only involve people outside of end-times Israel. Others interpret this to mean all people except for Christians. A third view is that this judgment involves all people of the earth, believers and unbelievers, Jews and Gentiles, who have survived the tribulation previously described (Matthew 24:21). That series of catastrophes was cut short to spare humanity and the elect believers in Jesus (Matthew 24:22).

The act of judgment takes place immediately, with Jesus' explanation to follow. This vast array of people will be gathered before Him, and Jesus will separate them into two groups. This uses the imagery of shepherding. This was a profession very familiar to those hearing Jesus speak these words. Sheep and goats would share the same fields during the day, but they had to be separated at night, for various mundane reasons. The important detail here is that they are separated, as two distinct groups.