Stick a 5V battery to your tongue. Stings a bit but doesn't damage you. Now stick your tongue in a 120V socket. You dead. Same thing happens when you increase voltage too much. Any circuit (with your body being part of the circuit when you touch it to electrodes) can only handle a certain amount of current before it burns out.
However with processors very slight voltage increases can be damaging because they're designed to run at such low voltages and currents. Generally a slight increase is not immediately damaging, as most processors are capable of working at somewhat higher voltages (and in fact that's how both AMD and Intel occasionally manage to tweak just a bit more speed out of an aging architecture; they rate the processor at something like 0.1 volts higher than the previous speeds, and that allows them to rate the clock speed a bit higher -- in the end, you basically get an already overclocked CPU from the manufacturer). However when you start increasing the voltage too much, it begins to damage the processor. It may not be immediately destroyed, but it can slowly degrade the CPU, and over time you might begin noticing more errors or instability. However, processors are designed to last 10 years or so at their "rated" speeds and voltages. Even if you cut the lifespan in half, that's 5 years, and anyone overclocking that much isn't likely to care if it lasts only even one year. It is of course possible to increase the voltage so much that you completely fry the CPU and sometimes take other components with it.
You can sometimes tell what's safe to do. Like with an Athlon t-bird, 1.85 volts isn't outside its operational range, but 1.75V is what they're rated at. AMD makes white-papers that show them operating at 1.85V, so it's usually safe to run them like that. Of course, at increased voltages you have increased heat, which compounds the issue and makes it more likely that you'll encounter errors or instability if you don't cool it well enough.
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