The ABA ranking, which is reported in US News and World Report, lists the top 100 schools in the nation. While the list is divided into the top 100 and then everyone else, with the top 14 considered the best of all, the tier system considers the top 50 as Tier 1 and numbers 51 through 100 as Tier 2. All others could be considered Tier 3 or 4.
Among the major considerations of the ABA's rankings is the difficulty of being accepted to that school, as those with more stringent requirements are seen as more prestigious. In theory, since students would most like to attend a Tier 1 school, these schools most be stricter in their requirements. Such considerations as undergraduate grades, LSAT scores and success with the state bar exam are accounted for in the school's ranking. So, too, are prominent alumni, which also make more students want to attend that school and add to the school's prestige.
Graduates of Tier 1 law schools have an advantage in gaining employment, especially in highly competitive positions, because of the added prestige of their school. As well, a lower personal percentile ranking is more acceptable for students from a Tier 1 school. Tier 2 students can make up for this slight discrepancy by ranking high in their class, which demonstrates that, while they may not have graduated from as prestigious of a school as others, they were among the best of a good school.
Certain Tier 1 schools, such as University of Colorado-Boulder, may rank in the top 50 one year and just out of the top 50 the next year, depending on the average GPAs and LSAT scores of the incoming class compared to those of other schools of similar rank. Many schools that are considered good, such as the University of Hawaii-Manoa, consistently rank within the top 100 but aren't considered Tier 1 because they aren't perceived as having the same level of prestige and don't demand quite as much in their requirements or their graduates aren't as prominent. Generally any school in the top 100 is considered good and credible.
Although the differences may be minor, it is generally considered better to graduate from a Tier 1 school than from a Tier 2, regardless of your personal rank within your class. Essentially, prospective law students should apply to a number of schools, attend the highest ranked school that accepts them and do the best they can at that school. While a lower percentile in a Tier 1 school can be seen as better than a high rank in a Tier 2 school, it isn't a guarantee that all students in Tier 2 are less skilled than those in Tier 1.