The 1/2 wide flimsy white teflon tape that is commonly found in hardware stores is certified as a thread lubricant, and is approved as a thread sealant in limited applications. Primarily for finely threaded fittings of 3/8 of an inch or less in diameter.
In the trade we use a variation of teflon tape that is 3 times as thick and packed in 3/4 inch wide x 520 inch rolls. Per the manufacturers specifications and MILSPEC regultions it is certified as a thread sealant when 3 or more wraps is applied.
Recently we have begun to see a heavier variety of teflon tape showing up in the hardware stores. The heavier varieties are color coded. The pink being about twice as thick and the yellow is 3 times as thick, or approximately equal to the commercial type used by plumbers.
While the actual composition of the material remains the same, there is a heavier guage of teflon tape that is commonly sold as High Density teflon or "GAS" tape. You would have to check with your local code authority before using the GAS tape on water lines. Although it is just a thicker variety of the same material, some inpectors will not pass it because the package does not list it as suitable for use on water lines. By Contrast, my local inspector prefers to see it.
There is also a proper method of installing teflon tape. Begin with a short tail of the tape coming off the top of the roll. Hold the roll on the left side of the pipe and hold the end of the tape on the underside of the pipe to be threaded, then begin wrapping in a clockwise rotation. Keep a continuous back pressure on the roll to slightly stretch the tape as you wrap. This figure 8 method will insure proper tension so the tape is drawn into the threads of the pipe to effect a good seal. (see photo)
Teflon tape is best suited for fittings that you anticipate will require periodic maintenance such as when attaching a shower arm. For permanet fittings the preferred method is to use pipe dope.
A word of caution when selecting pipe dope. READ the Label and make sure it is listed for the type of service you intend to use it on. Some dopes are only listed for water or gas, while others are listed for oils, natural gas, propane, high and low pressure air, etc etc.
My personal preference is a dope called "Rector Seal". It is a non-hardening dope that is listed for potable water, steam, natural gas, propane, gasoline, high and low pressure air, inert gases and many more applications.