hosts.allow and hosts.deny in Linux

hosts.allow and hosts.deny files are mainly used for restricting the ssh to th editing  your server in which you are    
editing the files.

These files are maintained by the TCP wrappers

These are mainly used for securing your server or system from outside acccess.

The way it happens when a outside ip asks for permission to ssh to your system:
1)The Tcp wrapper first checks for entry in /etc/hosts.allow.If a entry is present ,it does not go to the /etc/hosts.deny.
2)If entry is not present ,then it goes for hosts.deny ->if entry is present , the ip is denied
                                                                                  if entry is not present ,the ip is allowed.

If the entry is not present in both hosts.allow and hosts.deny , the entry is allowed.