Elo and MMR
Also said as Elo rating, MMR, Matchmaking rating, Skill rating, TrueSkill, Glicko
A number estimating skill. Elo compares your rating with your opponent's to work out how likely you were to win, then moves both by how surprised it was. MMR is the same kind of number in a game.
It finds out how good people are just from who beats whom, without ever being told. Winning takes exactly what the loser gives up, so ratings stay comparable over time.
Say it
“Use Elo with K of 32 for a player's first 30 games, then 16. Start everyone at the pool average, keep the number hidden, and match on it.”
Where you’ve seen it
Arpad Elo's system was adopted by the US Chess Federation in 1960 and by FIDE in 1970, and FIDE uses K factors of 40, 20 and 10. Microsoft's TrueSkill for Xbox Live adds an estimate of how uncertain the rating is.
Not to be confused with rank
MMR is what the system believes about you and is often hidden. Rank is what it shows you. One is a measure, and the other is partly a reward.