Reputation is a measure of how one creature feels towards another. It is measured on a scale of 0 to 100, sometimes thought of as "percent friendly". A reputation of 0 to 10 indicates hostility, 90 to 100 indicates friendliness, while 11 to 89 indicates neutrality. Reputation is tracked both on the faction level and on the personal level. These two reputations are added together to determine the reaction of a specific creature.
Feeling friendliness to a creature will cause an immediate drop in personal reputation towards anyone who is seen attacking that creature, resulting in hostility towards the attacker. Seeing a creature considered hostile will generally trigger a fight with that creature (or flight from it), although this can be changed through scripting. A neutral reaction type causes neither combat nor a reaction to the other being attacked.
For players, reaction types and the PvP setting affect the color of the highlight creatures receive when the mouse is hovered over them. Hostile creatures are red, neutrals blue, and friends green.