In rarefied flows the navier-stokes equations are no longer valid when the mean free path is in the some order of magnitude as the domain of internest. that is to say the continumm approximation to reality is not longer valid. The general idea here is if the Knudsen number is greater than 1 then statistical methods need to be employed. You can try here: http://en.wikipedia.org/wiki/Knudsen_number or look up rerefied flows in wikipidia or some other reference. So it depends what you are looking at but it is a plce to start. Good luck.