Most commonly, this is a designation of a specific type of ammunition. See the section on Naming of Calibers [yet to be written]. When referring to firearms, it is the ammunition caliber that the firearm is designed to use.

Less commonly, caliber is the diameter of the bore of a firearm, and it is expressed in hundredths or thousandths of an inch (unless millimeters are explicitly stated).

In the context of firearms, caliber rarely or never refers to quality.