main.py:

from module1 import some_function
x=10
some_function()

module1.py:

def some_function():print str(x)

When I execute the main.py, it gives an error in the moduel1.py indicating that x is not available.

My understanding was that using from x import y in module main.py brings the definition/value of x.y in the local namespace of main.py. And since both the function definition and variable x are in local namespace of main.py, it should work ok. But this seems incorrct undersyanding. So what is the exact concept here? Any link to officcial python documentation for this concept?

Each module has its own global name space.

from module1 import some_function
x=10
some_function()

some_function uses module1.x in its definition, but you are setting x in the current module. This would work:

from module1 import some_function
import module1module1.x = 10
some_function()

Note that you can't use from module1 import x, then set x = 10, because that import simply initializes a new name x to have the same initial value as module1.x; x = 10 then gives a new value to the new variable.