In layman terms:
ISO refers to the sensitivity of the sensor itself towards light. The higher, the more sensitive the sensor is and hence able the user to shoot under low lighting conditions with a faster shutter speed. However, it comes with a price - quality will be loss and you will find noise and grain on your image.
Standard ISO values are namely: 50, 100, 200, 400, 800, 1600, 3200 (each are one stop away.)
Correct me if I'm wrong.