Falling from Grace is a term used when the Elders, and possibly other angelic beings such as Angels and Whitelighters, give up their resolve and all magical powers to live out a mortal life. The concept is similar to 'clipping their wings', but is more profound, as the person in question loses their reason for being what they are.
The only known Elder to Fall From Grace was Leo Wyatt after the Elders manipulated him into staying an Elder and leaving his family. Upon Piper's near death she called for Leo. Leo remembered Piper and jumped off of the Golden Gate Bridge, his Elder robes and powers disappearing as he fell. It is unknown if this is the only way to Fall From Grace.
This article was taken from the Charmed Wiki.