|Characters in New World have a Level. This broadly represents their capabilities, with higher level characters having more Attributes and Trade Skills than lower level characters. However, level alone is not a full measure of someone's combat or crafting effectiveness. It depends on how those points were allocated.
As you fight, gather, and craft you will earn XP. When you've accrued enough XP you will gain a Level. The amount of XP you need to earn varies, increasing as your level does. Earning level 10 requires more XP than earning level 2.
You can see your current progress towards your next level along the bottom of the screen. When you gain XP, you will see the amount added appear briefly and the bar will fill further. When it fills completely, you gain a Level.
When you gain a Level, you are awarded points to spend on either Attributes or Trade Skills. These points are not interchangable, and which you gain and how many depends on the Level you just reached. Gaining a Level provides no other benefit, so you have to spend your points on the Progression screen (default: [K]) to improve your abilities.