This may seem like a stupid question but I'm new to the Baldurs Gate realm. What exactly is Level Drain, what does it do and more importantly how do I get rid of it?

Thanks.

It drains your level, meaning you go down a level or two every time this hit connects (ie. a level 12 fighter becomes level 11 0r 10 ...etc), this is more problematic for spell casters, as their levels drop, so does the amount of spells slots available for memorization (even if you have the spells memorized prior to getting level drained, it will just disappear).
To get rid of level drain, either:
1) use the restoration spell (you can buy scrolls or get it from temple services)
2) kill the level drained character and resurrect him/her (won't work on the protagonist.....of course)

Level drain makes it so for instance if you were a level 10 fighter and you were level drained 2 levels, then you would be a lvl 8 fighter with the hp and other boneses.. well disadvantages of an 8th level fighter. The only way to become lvl 10 again is to goto a temple and have them cast greator restoration (or lesser restoration) or get a scroll or spell of restoration. You can also become immune to it if you have negative plane protection I think. Have fun

What it does is s**k... but a restoration scroll will fix it, and negative plane protection will prevent it, for a short while. Also, aran linvail gives you an amulet that protects you against it. (amulet of power)

Permanent immunity to Level Drains is the best reason to be an undead hunter. It's great to be able to put your undead hunter in a doorway and watch all of the undead creatures, particularly the vamps, try to do anything.