Randomized group design involves randomly assigning subjects to different groups that correspond to different conditions or values of the independent variable. This makes the groups statistically equivalent at the start of the experiment. There are two primary ways to form random groups - captive assignment, where all subjects are present and randomly assigned, and sequential assignment, where subjects participate on different days. A randomized group design with only two groups can test the relationship between one independent and dependent variable, but with three or more groups, the design allows testing more complex relationships.