OVERVIEW
There are 100 character levels and 1,000 skill levels in SAO. While the character levels themselves do very little alone to increase a character's power, they do increase the character's capacity for growth by means of raising skill level cap and increasing skill slots. A player's character level and skills increase independently.
The below table lists the first few level milestones and the skill slots and max skill levels associated with them. Keep in mind all skills can reach your max skill level individually. Any skill points obtained over the maximum are lost forever.
LEVEL 1 = 4 Skill Points = 100 Max Skill Level
LEVEL 10 = 5 Skill Points = 200 Max Skill Level
LEVEL 20 = 6 Skill Points = 300 Max Skill Level
LEVEL 30 = 7 Skill Points = 400 Max Skill Level
Etc
EQUIPMENT LEVEL
All character will have their overall character level displayed in their mini-profile along side a second number in parenthesis. This section number is known as a character's equipment level, or e-level. This secondary level helps determine your strength against both other players and monsters in the bestiary. It is calculated by adding all a character's equipment levels together.
"Ŀ" is the symbol for composite level and it will be displayed below your experience and money count in your mini-profile.
SKILLS
Skills cover a massive verity of subjects ranging from using weapons to fishing to crafting. Even if you don't have a skill equipped, it doesn't mean you can't preform the action. For instance, if you don't have the cooking skill you can still cook, but not very well. If you don't have perception you're not blind and deaf. Although it is a virtual reality game, real life skills do not translate to in-game skills (with the exception of combat). An amazing chef in real life would not instantly be able to cook masterpieces. Additional information on individual skills can be found in the skill list.
While character levels are purchased with experience points, skill levels are earned by taking actions associated with the skills. During any mission or social threads, gamemasters will insert skill increases as deserved. The increases can range from a single point to a dozen depending on the situation. If you find your skill levels are lacking and you're overflowing with extra experience, there is also the option of buying skill levels at an exorbitant price.
SKILL SLOTS
Skill slots are basically the number of leveled skills a character may have at any time. Once occupied, a skill slot can only be changed by paying a hefty experience fee. Upon gaining a new skill slot you may immediately fill it or keep it open for later use. Skill slots are gained every 10 levels or during special events.