OK, so in the 20th century, there were two big advances in physics, beyond anything Newton dreamed of. One was Einstein’s general theory of relativity, which describes gravity in far greater detail than Newton ever did. The other is quantum mechanics, which describes systems with very small action and/or angular momentum (in practice, this usually means very small systems like atoms). Both have been very well tested, and have passed all of the tests that have been thrown at them, with flying colors.
There’s just one problem: They’re inconsistent with each other, and nobody knows how to reconcile them (though there are a number of attempts, most notably the String Model).
Now, under any sort of conditions humans have any experience with, this isn’t a very big problem, because we’ve never actually observed any situation where both would be relevant. Black holes, for instance, typically have angular momenta much higher than those associated with quantum mechanics. But such situations could occur: For instance, if you wait for the 10^70 years or so required for a black hole to evaporate, eventually it’ll get down to a small enough size that quantum mechanics would be relevant, and we don’t know what would happen then.
Now, in many areas of physics, it is routine to use units such that the relevant physical constants are 1, just because it makes it a lot easier to write out the equations and so on. So, for instance, in general relativity, one typically uses units such that G (Newton’s constant) and c (the speed of light) are both equal to 1, because otherwise, those two constants would be cluttering up the equations all over the place. In such units, distance, time, and mass can all be measured in the same units (meters or whatever). And in quantum mechanics, it’s routine to use units where hbar (Planck’s constant) and c are both 1.
Well, if you’re working (or attempting to) in a theoretical domain where both GR and QM are relevant, it makes sense to use units where G, c, and hbar are all equal to 1. There is only one set of units that makes all three 1, and that set is the Planck units.
Do they have any relevance beyond that? Well, we don’t know. We can say with confidence that if (for example) you had a black hole with radius of 1 Planck length, or a photon with that wavelength, then both GR and QM (or rather, some more complete theory that encompasses both) must be relevant. But it may also be relevant at scales much greater than that (but still much smaller than anything we’ve ever probed).
Nor do we know anything about what happens at scales smaller than that. It may (or may not) be that the unification of GR and QM involves quantization of spacetime. And if so, it may (or may not) be that the quantification of spacetime is of a sort that has a minimum possible distance. And if so, it’s a reasonable guess that that minimum possible distance would be in the general vicinity of the Planck length, but that guess may or may not be accurate. And even if there is a minimum possible distance, and it’s somewhere in the vicinity of the Planck distance, nobody would be at all surprised if it turned out to be half the Planck distance, or pi times it, or anything like that.