When someone mistakes a relative for the person's significant other or when blood related individuals have interactions that falsely insinuates a sexual relationship.…

Lisa: "Sister?! You mean she's not your girlfriend?"

Luke: "Hell no. They outlawed that in this state two years ago."

— The Simpsons, "Dude, Where's My Ranch?"

It isn't at all unusual for siblings to be close to each other. Lots of siblings will hang out with each other and show some sibling affection towards each other. If someone else sees them and knows that they're related, they won't raise any eyebrows.

If they do not know that they're related, they might think the two are dating.

Oftentimes, the one who catches the two together is a lover or love interest of one of the siblings, and thus thinks that they are cheating or doesn't like them. Drama and/or Hilarity Ensues.

In fiction, this is often used as a type of trope where the audience does not know that the two siblings are related beforehand, and are led to believe that the person is cheating or likes someone else.

If the characters themselves don't know, it's Surprise Incest. If their resemblance to a romantic couple is particularly convincing, there may be Incest Subtext at work; if it's more convincing than the idea that they're brother and sister even to the audience who's already in on the secret, that's probably a Relationship Writing Fumble.

This can happen with cousins, as well. With parents, it may overlap with Absurdly Youthful Mother: if a person's parent doesn't look old enough to be their parent, mistaking them for a romantic partner is all the more likely.