The Permission Level list displays a hierarchy of permission levels. As an example, if a permission is changed at the User level, it will override the User Group, Permission Defaults, and Type Default permissions.
Type Defaults: This is the default value for a permission, all users across all permission defaults will have this value by default UNLESS the Permission Default, User Group or User setting is different.
Permission Defaults: This is the default value for a selected permission, all users in a selected permission default will have this value by default UNLESS either a User Group or User setting is different.
User Group: This is the value for a selected user group, all users in a selected user group will have this value by default UNLESS the User setting is different.
User: Is the value for an individual user, any value here applies to that user only.