Those who believe in him won't be condemned. But those who don't believe are already condemned because they don't believe in God's only Son. – John 3:18
Later, the apostle Paul said, “There is no condemnation for those who are in Christ.” (Romans 8:1) Paul likely said this because of what Jesus said here in John. As Paul also explained, everyone has sinned and deserves the penalty for sin. But Jesus said that if we believe in Him we won't be condemned. This is the best news that anyone could get. It is the basis of all that we teach as Christians. It is God's unlimited grace and mercy explained in one simple sentence. We all deserve to die (Romans 6:23) but God, through Jesus Christ, has said we don’t have to if we believe.
The second sentence in this verse is just as beautiful. I have heard many people say that a loving God could not send people to a literal hell of eternal fire. Jesus said very plainly that God does not send people to hell. He does not condemn them, they are already condemned, in fact they have condemned themselves, because if their unbelief. Just as Jesus told Nicodemus in John 3:3 that unless he was born again he wouldn’t even see the kingdom, we too have to be born again.