Downline is the group of people/users that have registered in a site through us.

The important thing to know is that in almost all sites we earn comissions over the earnings, and sometimes over the purchases, from the users of our downline. The comission percentage varies from site to site.

In each site (PTC, PTR, etc) there are tools (links and banners) that if well advertised permit redirect other persons to the site. If these redirected persons signup using our links they will be placed in our downline.

Your redirecting links are usually known as referral links.

The people who signup using our links will be the level 1 of our downline. People who signup using the links of the persons in our level 1 downline will be considered as our level 2 downline, and so on.
On most of the sites we earn only from our level 1 downline but it is frequent that , specially in some PTR sites, we can earn from other downline levels.

With all this knowlegde you can see that it is important spread your links over your friends and other persons because if you do it you will increase your earnings.