Except in certain cases, Obsidian resolves conflicts by merging the versions.
- https://help.obsidian.md/sync/troubleshoot#Conflict+resolution
- https://help.obsidian.md/sync/troubleshoot#Sync+deleted+a+note+I+just+created+on+two+devices
Data loss is possible in the non-merge cases. It is rare with merges, but there sometimes corruption happens: Obsidian Sync incorrectly duplicates sections of files.