Just like hitting a pothole, hitting a plot hole will jar your reader out of their tranced absorbtion in your story.
Plot holes are continuity errors. In movies and TV, there’s usually at least one person assigned the job of watching continuity, so that the lead character doesn’t wind up with a coat on in one shot, no coat in the next as the dialog continues uninterrrupted, and then the coat reappears, all without leaving the room or taking it off and putting it on.
I once read one of the most dreadfully bad novels of all time, from an international humongous publisher, where the door that the heroine pushes inward to enter the deserted building in Chapter One, in Chapter Three traps her by being a door that only pushes outward, that is now boarded across. (It also had female fingerprints and a WW2 USAF uniform. No, not US Army Air Force: US Air Force.) This is what we can call a detail continuity, where you just make the door swing outward in Chapter One: really tiny revision, actually. Same with an assortment of draftos like inconsistent names and hair colours from things not being entirely changed between drafts.
The real plot holes you have to watch for are when you —
1. never explain why something convenient but unusual was there, not even with a guess by the characters (Son of Deus Ex Machina);
2. characters jump to a conclusion they have no reason to make (character acting on author knowledge);
3. characters fail to think like any normal human being (Stupid on Cue, Incurious on Cue, &c);
4. have unexplained changes of behaviors or relationships (character acting on author motivation; that is, “I need you to do this to make my plot work”);
5. have no consequences for actions that ought to have them (author fiat);
and all such WTH?! moments.
The cures are often that you need to explain things, or else you need to come up with some rational-seeming motivation from inside the character, or basically you need to remove the events that cause the hole. This often requires re-plotting on very basic levels, so you need to address this very early in revision. Otherwise, polishing paragraphs is a waste of time when whole chapters will need to be excised.
My Keys students know I could quote chapter and verse from several badly flawed stories I use as horrible examples and practice crits. The worst problem with plot holes is that the author is often perfectly blind to their existence. One reason to join sub-and-crit workshops is that they get you used to critiquing other peoples’ work so you develop an eye for these. It helps you spot them in your own work. Otherwise, you get to flinch when everyone who crits yours points out that you never provided a way for the protagonist to get back home in chapter whatever. But, hey, what are friends for?