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How does that relate to our Histogram?
In the camera sensor the amount of light falling is measured in as a proportion of 255. Each pixel produces an output scaled 0-255
 
Black = 0
 
White = 255
 
The number of pixels at each level of brightness is therefore displayed on the vertical axis. In this image we have 1/3rd Black, 1/3rd Mid Grey, 1/3rd White.