101 Photo Basics | Exposure

Technical Definition (courtesy of wikipedia)

Exposure is the amount of light per unit area (the image plane illuminance times the exposure time) reaching a photographic film, as determined by shutter speed, lens aperture and scene luminance. In digital photography "film" is substituted with "sensor". Exposure is measured in lux seconds, and can be computed from exposure value (EV) and scene luminance in a specified region.

What did that just say? 

Exposure is a sort of umbrella term, It combines the data from your shutter speed, your aperature and ISO, to make the image. 

When in auto, the camera takes all the info and does its best to balance it out to the "right numbers" to make the spot you focused on "correct". It doesn't care if your highlights are blown out or if detail is completely gone-its goal is to have a decently exposed (in general) image. 

Learning exposure and all the components involved, will help you step into manual mode, where you can manipulate the settings to create the image you see in your head. It will give you real control over how your images turn out.