When previewing your Levels histogram you will notice a mountainous range that represents your image exposure. In its simplest form this reveals how well exposed your image was to light.
The left-hand side represents the shadows, the middle section is the midtones, while the right-hand side is the highlights. A well-exposed image will have a balanced mountainous range that does not peak at either end.
When using Levels adjustment layers, you do not want to make destructive modifications by clipping the graph and pulling the shadow/highlight sliders in too far. This will result in you compressing the midtones and, although this will create contrast, you will lose key detail in the shadow and highlight areas.