A computer screen is made up of colored dots called pixels. The resolution of the screen is the number of pixels along the top and the number down one side. Obviously if you multiply those two number together you get the total number of pixels on the screen.
The most common resolution is 1024 by 768 or XGA. This means that there are 1024 pixels along the top and 768 pixels down the side. This means if you were displaying an image on a web page that was 500 pixels wide by 400 pixels high then it would take up about half the screen. This is why at lower resolutions things look bigger as images of a certain size take up more room on the screen. As you increase the resolution things get smaller and you can see more. However at high resolutions, say you're a professional running 1600 by 1200, text in particular can get very small and you have to sit close to read it. However high resolutions are best for graphics work.
Each standard resolution has a special name here's what each name means in terms of pixel resolution:
VGA: This is the oldest (by that I mean ancient) resolution and is 320 by 240 or 640 by 480 no modern LCD laptop screens come in this resolution.
SVGA: Called super VGA and is 800 by 600 again no modern LCD computer monitors come in this resolution but you may be able find an old 100-333Mhz laptop with this resolution.
XGA: Probably the most common resolution. 1024 by 768.
SXGA or UXGA: Super XGA and Ultra XGA. Either 1400 by 1050 or 1600 by 1200.
WSXGA/WUXGA: 1640 by 1024 and 1920 by 1280 (wide screen format for nice DVD movies).
If you plan using your laptop for just Internet and email then save some cash and buy an XGA screen. If you want a mobile DVD and entertainment laptop look for one with a WSXGA or WUXGA. The native widescreen laptops are great for DVD movies and the high resoltuion screens bring out all the detail in this digital format. If you want to play games or do some photo editing on your laptop then I recomend you spend a little more and go for a SXGA or UXGA LCD screen.