The ancient Greek astronomer Hipparchus, around 129 BCE, grouped the stars into 6 categories of brightness. Magnitude 1 was the brightest, 6 was the dimmest.
In 1850, Norman Pogson refined this system, making 1st magnitude 100x brighter than 6th, or each magnitude about 2.5x brighter than the one before it.
In modern times the scale was extended to 7 and higher for dim stars visible with telescopes, and to 0 and negative numbers for very bright objects, such as the sun.
These numbers refer to the apparent magnitude, or how they appear to the naked eye observer. Remember that the numbers work opposite to what you might expect. A 2nd magnitude star is brighter than a 4th magnitude star, and a -1 magnitude is a very bright object. The apparent magnitude is what we list in the star descriptions.
Apparent magnitude does not tell us much about a star, because the stars are at widely different distances. By analogy, a lighthouse very far away might be dimmer than a flashlight right in front of us.
So we need a way to describe how bright a star really is, the absolute magnitude. This is how bright a star would look if it were located at a standard distance, about 33 light-years away.
Luminosity refers to the actual amount of energy a star emits per second. Not all of this energy is visible to our eyes. The absolute magnitude of a star is related to the luminosity by physical laws. Our star descriptions tell you how much more luminous the star is than the sun.