Friendly Fire is an optional feature for team matches, which allows players on the same team to damage each other. It is called "Team Attack" in SSB.
Some people may not want to turn it on, but it does make some interesting strategies for the game. You can send projectiles at your own team's Ness, or Lucas, to heal them while they're using PSI Magnet, or attack your own Mr. Game & Watch, while they absorb your projectiles and use them to attack your opponents with Oil Panic; With your teammate's permission, (hopefully) you can absorb them with Kirby, or shoot them at opponents (you can do the latter with King Dedede also). Allies with projectiles or long recoveries can help their partners recover by hitting them and allowing them to re-use their third jumps.
Official tournaments for all three games require that Friendly Fire be turned on.