The diffraction limit is the fundamental resolution limit of a telescope. This is the size of "spot" that will be created on the camera sensor for a single point of light like a star [1].
Its easy to calculate, just take the wavelength of the of light you want to observe and divide it by the diameter of the primary mirror (and multiply by ~1.2).
For example, for JWST observing in the mid-infrared, say 4micron, with a 6.5 meter diameter mirror, has a resolution limit of:
4e-6 / 6.5 = 6.15e-7
Or about 0.6 micro-radians (astronomers would normally use arcseconds but leaving in radians for clarity).
This is just the theoretical limit though, it's reduced by any imperfections in the optics, and for telescopes on the ground, it's limited by the blurring of the Earth's atmosphere to about 4 micro-radians.
For narrow fields of view, however, ground-based telescopes can use adaptive optics to compensate for this shimmering/blurring in real time and reach close to their theoretical diffraction limit. Plus, they can be much bigger since we don't have to launch them into space. I'm not familiar with the MGT but this might be how it will surpass JWST in terms of resolution (which again also depends on the wavelength).
For infrared observations though, a huge effect that can't be compensated for is sensitivity. At mid-infrared wavelengths, the Earth's atmosphere actually glows and makes it much harder to see faint sources. This is one of the ways JWST will really shine.
[1] Note however that you can still do things like measure the position of an object to less than the diffraction limit using e.g. centroiding. But you can't tell if there are two objects or one below this limit.
I'll add to this that resolution is not the only metric by which you can judge a telescope. One major advantage that space telescopes have is that their environment is much more stable, making calibration (for example, of the flux of a source) easier. On Earth, the weather changes from night to night, or even from minute to minute. You're effectively looking through a constantly changing, semi-opaque filter - the atmosphere.
Ground-based telescopes have their own advantages, like the fact that they can be much larger and therefore can collect much more light.
This is just to say that both space- and ground-based telescopes are useful, and have their own strengths.
Its easy to calculate, just take the wavelength of the of light you want to observe and divide it by the diameter of the primary mirror (and multiply by ~1.2).
For example, for JWST observing in the mid-infrared, say 4micron, with a 6.5 meter diameter mirror, has a resolution limit of: 4e-6 / 6.5 = 6.15e-7 Or about 0.6 micro-radians (astronomers would normally use arcseconds but leaving in radians for clarity).
This is just the theoretical limit though, it's reduced by any imperfections in the optics, and for telescopes on the ground, it's limited by the blurring of the Earth's atmosphere to about 4 micro-radians.
For narrow fields of view, however, ground-based telescopes can use adaptive optics to compensate for this shimmering/blurring in real time and reach close to their theoretical diffraction limit. Plus, they can be much bigger since we don't have to launch them into space. I'm not familiar with the MGT but this might be how it will surpass JWST in terms of resolution (which again also depends on the wavelength).
For infrared observations though, a huge effect that can't be compensated for is sensitivity. At mid-infrared wavelengths, the Earth's atmosphere actually glows and makes it much harder to see faint sources. This is one of the ways JWST will really shine.
[1] Note however that you can still do things like measure the position of an object to less than the diffraction limit using e.g. centroiding. But you can't tell if there are two objects or one below this limit.