As the AI perception system that's built into Unreal goes, AIs and anything that can be detected can have a team. Some teams are against each other, whereas some are just neutral. As a result, when an AI comes to perceive something, that something can be Friendly (it is in the same team), Neutral, or an Enemy. For instance, if an AI is patrolling a camp, we can ignore Friendly and Neutral entities, and focus only on Enemies. By the way, the default settings are to perceive only enemies.
The way in which you can change which kind of entities an AI can perceive is through the Detecting for Affiliation settings of Sense:
This provides three checkboxes where we can choose what we would like that AI to perceive.
There are 255 teams in total, and by default, every entity is within team 255 (the only special team). Whoever is in team 255 is perceived as Neutral...