What is the problem with shadowing names defined in outer scopes?

The currently most up-voted and accepted answer and most answers here miss the point.

It doesn't matter how long your function is, or how you name your variable descriptively (to hopefully minimize the chance of potential name collision).

The fact that your function's local variable or its parameter happens to share a name in the global scope is completely irrelevant. And in fact, no matter how carefully you choose you local variable name, your function can never foresee "whether my cool name yadda will also be used as a global variable in future?". The solution? Simply don't worry about that! The correct mindset is to design your function to consume input from and only from its parameters in signature. That way you don't need to care what is (or will be) in global scope, and then shadowing becomes not an issue at all.

In other words, the shadowing problem only matters when your function need to use the same name local variable and the global variable. But you should avoid such design in the first place. The OP's code does not really have such design problem. It is just that PyCharm is not smart enough and it gives out a warning just in case. So, just to make PyCharm happy, and also make our code clean, see this solution quoting from silyevsk's answer to remove the global variable completely.

def print_data(data):
    print data

def main():
    data = [4, 5, 6]
    print_data(data)

main()

This is the proper way to "solve" this problem, by fixing/removing your global thing, not adjusting your current local function.

A good workaround in some cases may be to move the variables and code to another function:

def print_data(data):
    print data

def main():
    data = [4, 5, 6]
    print_data(data)

main()

There isn't any big deal in your above snippet, but imagine a function with a few more arguments and quite a few more lines of code. Then you decide to rename your data argument as yadda, but miss one of the places it is used in the function's body... Now data refers to the global, and you start having weird behaviour - where you would have a much more obvious NameError if you didn't have a global name data.

Also remember that in Python everything is an object (including modules, classes and functions), so there's no distinct namespaces for functions, modules or classes. Another scenario is that you import function foo at the top of your module, and use it somewhere in your function body. Then you add a new argument to your function and named it - bad luck - foo.

Finally, built-in functions and types also live in the same namespace and can be shadowed the same way.

None of this is much of a problem if you have short functions, good naming and a decent unit test coverage, but well, sometimes you have to maintain less than perfect code and being warned about such possible issues might help.