Let's say the group name of user1 is xyz.
Is it possible, in the same Linux machine, that the username of some other user (not user1) is xyz?
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It's actually common practice to create group with the same name as user. For example there is root account and root group. Check /etc/group and /etc/passwd files to see it. Check also this two nixCraft pages to get to know more about those files:
User account and user group is not combined with each other anwhere else than in /etc/passwd file. So you can have:
but I think it can be a little bit confusing.