The $Z directive controls the minimum storage size of Delphi enumerated types. 

An enumerated type is stored as an unsigned byte if the enumeration has no more than 256 values, and if the type was declared in the {$Z1} state (the default). If an enumerated type has more than 256 values, or if the type was declared in the {$Z2} state, it is stored as an unsigned word. Finally, if an enumerated type is declared in the {$Z4} state, it is stored as an unsigned double word. 

The {$Z2} and {$Z4} states are useful for interfacing with C and C++ libraries, which usually represent enumerated types as words or double words.