The average IQ is 100--that is, the majority of people fall around that score. If you chart the IQ scores of a population on an chart, you get a bell curve---the number of people with low IQ scores are few, that number increasing as you travel down the x-axis toward a score of 100, which is the mean, then decreasing again as the number of people with high IQ scores falls.
Most people's scores don't deviate very far from the norm. A standard deviation may be small (that is, many people are clustered tightly around the mean) or large (the number of people near the mean is not as dense). Regardless, about 68 percent of people fall within one standard deviation above or below 100 whether that deviation is small or large, while about 95 percent of people fall within two standard deviations of 100.
An IQ score from one person's test cannot be directly compared with an IQ score from a different test taken by another person. Different tests have different standard deviations; for instance, an IQ of 130 could be a 140 on another test. For this reason, a percentile is more useful to compare the intelligence of people across tests. Someone in the ninety-eighth percentile has an IQ score at or greater than 98 percent of the population. Such a percentile qualifies you for Mensa, the "High IQ Society." A ninety-eighth percentile rank, on the other hand, means the score is greater than 98 percent of other scores.
The first IQ test was devised by Alfred Binet to try to separate students who were underachieving from students who were having difficulty keeping up with peers. The formula for the score used the child's mental age divided by actual age multiplied by 100. If a child had the acuity of a 14-year-old at age seven, his score would be 200. However, this way of comparing abilities isn't valid for adults. A new way of measuring a person's intelligence was developed in 1939 by David Wechsler, which instead measured how far a person's score deviates from the norm. Modern tests are based on this method.
There are many misunderstandings of what intelligence is among the general population. Many think that knowledge or memory shows intelligence, though knowledge and memory really only show, well, knowledge and memory. Intelligence is more aptly defined as mental agility or how facile a person's comprehension is. However, there is no one definition agreed upon by psychologists. Additionally, some people seek to expand the definition of intelligence to include qualities like social ability or athleticism, though an IQ score does not reveal anything of those qualities.