The level is how much Damage and Health your Character has! It will also allow you to equip more items while playing! :)

To upgrade your Level you need enough tokens for that specific Character. You can get them in Crates, on your League Rewards and for your Mastery Road Rewards.

Once you have the tokens and the coins, you're good to go! Access the friend you want to upgrade by tapping on the characters button on the main screen, the one you want to level up and then on the "upgrade" blue button. As simple as that! :)