The magnitude scale was invented by an ancient Greek astronomer named Hipparchus in about 150 B.C.  He ranked the stars he could see in terms of their brightness, with 1 representing the brightest down to 6
representing the faintest. Modern astronomy has extended this system to stars brighter than Hipparchus' 1st magnitude stars and ones much, much fainter than 6.

As it turns out, the eye senses brightness logarithmically, so each increase in 5 magnitudes corresponds to a decrease in brightness by a factor 100. The absolute magnitude is the magnitude the stars would have if
viewed from a distance of 10 parsecs or some 32.6 light years. Obviously, Deneb is intrinsically very bright to make this list from its greater distance. Rigel, of nearly the same absolute magnitude, but closer, stands
even higher in the list. Note that most of these distances are really nearby, on a cosmic scale, and that they
are generally uncertain by at least 20%. All stars are variable to some extent; those which are visibly variable are marked with a "v".

What are apparent and absolute magnitudes? Apparent is how bright the appear to us in the sky. The scale is somewhat arbitrary, as explained above, but a magnitude difference of 5 has been set to exactly a factor of
100 in intensity. Absolute magnitudes are how bright a star would appear from some standard distance, arbitrarily set as 10 parsecs or about 32.6 light years. Stars can be as bright as absolute magnitude -8 and as
faint as absolute magnitude +16 or fainter. There are thus (a very few) stars more than 100 times brighter than Sirius, while hardly any are known fainter than Wolf 356.
 

explination taken from Chris Dolan.
 
 
 

    We chose four layers to represent the differences in the brightness of the 26 stars as seen from the earth.  The appearence of brightness to us on earth is the Apparent Magnitude.  We choose to use this view since it is what we see when we look up at the sky.  The brightest stars are in the top layer with each successive layer being less bright.  We selected this order because when you look at the sky, you notice the brightest stars first.  The fourth layer contains -2 to -1, the third layer contains -1 to 0, the second layer contains 0 to +1, and the first layer contains +1 to +2.  Please notice that the layers do not correspond to distance from the earth.  The stars in the top layer are not necessarily the closest to earth, they appear the brightest.