The name describes the job: day stands in for night. The French call it “la nuit américaine”, American night, after the Hollywood westerns that used it so much, and François Truffaut took that phrase as the title of his 1973 film about film-making, released in English as “Day for Night”. For most of cinema history it was the only practical way to show a wide night landscape: film stock was too slow to record moonlight, and lighting a whole valley was out of the question.
It is still used. Modern cameras can shoot in very low light, but a night exterior still needs a lot of lighting, a crew working through the night and a sky that does what it is told. Shooting in daylight and grading to night is cheaper, and it gives the editor control. Night exteriors in “Mad Max: Fury Road” were famously shot this way, and Jordan Peele’s “Nope” filmed its night scenes in daylight, pairing a film camera with an infrared one so the sky could be turned black.