This page explains both how to understand the hostile state, and the effect on the BGS (Background Simulation). Use the tags above to read about related items, together with similar/related functions in-game.
Your reputation with competing factions can drop to Unfriendly without issue. When it becomes Hostile, if they control the station, they will obliterate you. If you are running black ops, you may go hostile when parked. If you do, let them fire on you a touch, and then Enter Hanger. Log out, and when you log back in, you’ll be in a penal colony with no rebuy. Fly to another system where they don’t control the station, build a little REP, and you are safe again.
Hostile status can be seen in the RHS panel in a system where the faction is present.
Effect on Player: Possible death from station aggro.