According to Wikipedia as at 17 May 2010 (http://en.wikipedia.org/wiki/DBm), dBm is an abbreviation for the power ratio of the measured power referenced to one milliwatt (mW). It is used in radio, microwave and fiber optic networks as a convenient measure of absolute power because of its capability to express both very large and very small values in a short form. 

To express an arbitrary power P in Watt as x dBm, the following equation may be used:  x = 10 log10 (1000P)

Some examples: Zero dBm equals one milliwatt. A 3 dB increase represents roughly doubling the power, which means that 3 dBm equals roughly 2 mW. For a 3 dB decrease, the power is reduced by about one half, making −3 dBm equal to about 0.5 milliwatt. 

dBW is referenced to one watt (1000 mW). 

By comparison, the decibel (dB) is a dimensionless unit, used for quantifying the ratio between two values, such as signal-to-noise ratio.