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Item quality

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There are five main levels of item quality in terms of magical abilities: Normal, Magical, Rare, Set and Unique.

The Quality Levels

Unique & Set Items

Uniques and Set items have preset mods, though the values of these mods may vary somewhat. A given item might spawn with somewhere between +100-150% damage, for instance. Uniques are golden named items, and there is just one unique per item type, in most cases. Uniques are usually very good items, but are seldom the best possible item of that type. They often usually special items though, with mods not possible to find on magical or rare items.

Set Items

Set items have green names and are like weaker Uniques (usually). Each set item is of various use on its own, but their real value comes when you wear the whole set at once, since additional bonuses then accrue. Even wearing just two or more items in a set will often deliver a hidden set bonus.

Rare & Magical Items

Rares are essentially magical items with more possible modifiers. While magical items can have at most one prefix and one suffix, rares can have up to three each, though they do not spawn multiple modifiers from the same family. You won't get two or three prefixes that add cold resistance on the same item, for instance. You can sometimes find rares with stacking mods when a prefix and suffix that add the same property occur on the same rare. Cruel and Kings both add % damage, for instance.