In digital imaging, there are 256 levels, or tonal values, ranging from black to white. Black is level 0. White is level 255. Of course, not all images (e.g. extreme foggy, misty, atmospheric shots) contain the full tonal range from black to white, but most do.
The histogram (Levels) is a graphical representation of the tonal values in an image. Ideally, it should range from 0 to 255, with a good spread of tonal values throughout.
If the histogram is bunched up towards the left, it indicates the image is under-exposed. Note the crushed shadow detail.
If bunched up towards the right, it's over exposed. Note the blown-out highlights.
If the black and white points are set incorrectly, the image will have a dull, flat, washed-out appearance. Here they're wrongly set to 20/230.
Unless under instructions from a repro bureau or printer, you should not set the black/white points to anything other than 0/255. The printer may well adjust them later for technical reasons to do with repro, but don't try to guess what's required. It's true that some leeway is acceptable (e.g. up to 5% is usually OK), but your images will lack visual impact if the black/white points are incorrect, so don't do this as a matter of course.
In the vast majority of cases, it's best to set them to 0/255.