There are six primary stats, and these represent your abilities.
How strong you are. Raising your strength allows you to carry more, deal a greater amount of damage in combat, and increases your maximum hitpoints.
How smart you are. Raising your intelligence increases your maximum amount of mana and can make casting certain spells and skills more effective.
How strong your endurance is. Raising your willpower helps you regain hitpoints and fatigue back faster, and increases your maximum fatigue.
How healthy you are. Raising your constitution will increase your maximum hitpoints and fatigue.
How agile you are. Raising your dexterity allows you to dodge better in combat situations and affects how many attacks you get per combat round.
How charming you are. Raising your charisma will result in lower prices in the shops when you buy items, and higher prices when you sell. In fact, many shopkeepers will not deal with you unless a certain ratio of your total number of stats is charisma.
Note: chr must = 1/12 total stats (to sell in most shops)
To raise your stats, you need to go to the Temple of the Ages. Commands of note will be: cost and raise