Happiness is a number between 0 and 255 that gauges how friendly a Pokémon is towards its trainer.
Walking with or leveling up the Pokémon will raise happiness. Capturing the Pokémon in a Luxury Ball or letting the Pokémon hold a Soothe Bell will cause happiness to rise quicker. Capturing the Pokémon in a Friend Ball will set its initial happiness to 200. However, letting the Pokémon faint will lower happiness, and trading the Pokémon will reset happiness to 0.
Evolution
A happiness of 220 or more upon leveling up is necessary to evolve: