Level, also called rank or tier (although the term tier also has other meanings), is a statistic that reflects the overall power and mechanical ability to influence the game world of whatever it relates to, which may be a character, item, trait or player in a specific role-playing game. Higher levels grant more power, usually by improving statistics or unlocking new traits or abilities, and improvement between levels is rare or restricted to traits not covered by the level. (When the term rank is used, a lower number may be better than a higher number, but higher is usually better in most other situations.)
In role-playing games, each level often has its own rules, meaning that there are a finite and defined number of levels.
Something that moves from one level to a higher (more powerful) level is said to level up.
Character level[]
Levels are one of the most common forms of character advancement, especially in games that use classes. (In such games, there may be a distinction between levelling up the character and levelling up the class, but not always and this would in any case only apply in games that allow multiple classes.) A character may level up when they accumulate enough experience points or when they reach a milestone.
Because levels can represent significant differences in a character's ability to affect the game world, it is good practice to keep all characters in a party at a similar level. This might be by levelling all characters at the same time (either as part of the rules or otherwise) or by focussing spotlight on characters who are lagging behind, to give them an opportunity to catch up.
Each level will either confer specific benefits to a character (generally improving their statistics or unlocking new traits or powers) or give the character's player a choice of benefits, or a mixture of the two. Also, each level may offer the same benefits or choices as other levels, or the benefits may be tailored for each level, or (again) a combination of the two. For example, in Dungeons & Dragons 5th edition, characters gain a hit die worth of hit points every time they gain a level, but they also gain other abilities according to their class, which players may have some choice over.
Other levels[]
Other things may have levels. For example, spells in Dungeons & Dragons have levels to indicate how powerful they are. High-level spells can only be cast by sufficiently high-level characters.