Resolution refers to the number of pixels on display or in a camera sensor.
Higher resolution means more pixels, which provides the ability to capture or display more visual information (more detail and clarity.)
For example, a display with 720 x 1280 pixels is much higher resolution than a display with 480 x 800 pixels.
Similarly, a camera with 12 megapixel (12 million pixel) resolution can capture more detail than a camera with 3 megapixel resolution.
Resolution does NOT determine physical size. For example, one 480 x 800 display might measure 3.0 inches diagonally, while another 480 x 800 display might measure 4.5 inches. Similarly, a 3 megapixel photo could be printed out at 4 x 6 inches just as easily as 8 x 10 inches.
However, in those examples, the display (or photo) with the larger physical size would not look as crisp as the physically smaller one. The crispness of a display or photo is more closely determined by a measurement called DPI or PPI.