Agile development methods are very different from the traditional Waterfall methods. So different that they can affect the culture of the organization.
Agile make a different promise than Waterfall. Waterfall promises a specific deliverable on a specific date; Agile promises that you can ship whenever you want.
Agile discourages specialization. An iteration is short yet requires analysis, development, and testing. Such a short cycle does not allow for different individuals to perform different tasks.
Yet the biggest difference between Agile and Waterfall is the partitioning of tasks and the encapsulation of information. Waterfall strives for clean, discrete changes from one phase to another, with information flowing between phases in well-defined documents. The flow between the requirements phase and the development phase is the requirements document (or documents). The test results are presented in a specific document. And so on.
Information in each phase is encapsulated in that phase, and only a small set of information is allowed to transfer (one might say 'leak') to another phase.
The partitioning of tasks and the encapsulation of information leads to silos within the organization. Once separate teams are established for requirements, development, testing, and deployment, tensions arise between teams. The testing team identifies defects that reflect on the development team. The development team blames the requirements team for incomplete or ambiguous specifications.
Agile -- at least Agile for small teams -- has none of that. The fast cycles of feature selection, design, development, and test provide immediate feedback. An ambiguous requirement is spotted early, and it is obvious to everyone. Defects are identified and fixed before implementing the next feature set.
More importantly, an Agile project has one team, and the measurement of success for that team is the delivery of software. That focus on success and the inability to shift blame to another team means that it is harder to establish silos.
Which is not to say that Agile will eliminate all silos. An organization with many Agile projects can still have silos. A large company using an "Agile for large companies" process may develop silos.
But for the most part, I believe Agile processes are incompatible with silos. The involvement of necessary stakeholders; the coordinated work of design, development, and testing; and the fast cycle times all push against silo-ization.
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