Michael wrote me with this question. He is just starting in jazz band, and has chord symbols in the solo section, and wants to know what they mean. So, I will try to explain this...
A chord symbol describes to the player what is happening harmonically at that particular point in the music. A savvy player uses these symbols as an aid in improvisation. The symbols also tell him if notes outside of the key signature are being used at that point.
First, music is built on scales. Various notes may be played together to form "harmonies". When three or more different notes are combined in a harmonious fashion, they are called a "chord".
The most basic harmony is the third. This is made by adding a note two scale steps away to the melody. Two notes with the same pitch are called "unison". If the second note is one scale step away, the interval is called a "second". A half step, or semitone, away is called a minor second. A full step away, or two semitones, is called a major second. A note two whole steps away (four semitones) is a major third, and if one and one half steps away (three semitones), a minor third.
A scale may be harmonized with notes a third above, and because of the intervallic relationships of the notes of the major scale, thirds will vary between major and minor thirds. Here is the C scale harmonized by thirds:
In the above example, the capital M is for Major, and indicates an interval of a major third. The lower case m is for minor. The lower note is referred to as the "root", the upper note is the "third".
If another third were to be added above the third already there, the notes form a chord. These simplest of chords are also called "triads". These triads (and all chords) are named for their lowest note, or root. They will vary among major, minor, and diminished. Major triads are composed of a major third, with a minor third added on top. Minor triads are composed of a minor third, with a major triad added on top. Chords are named major or minor from the lower third in the triad. Diminished chords or triads, have two minor thirds. In the major scale, this occurs on the seventh degree of the scale. Chord symbols are assumed to be major (C, F, G), unless the lower case m is behind the letter (such as Am, Dm, etc.):
(A minor chord may also be written with a minus sign (-) instead of the m. Example: E- instead of Em. The Bo symbol is a diminished triad, also may be written Bdim. Both are equally correct, but the o is faster and easier to read.)
The notes of a triad, or chord, may be arranged with any of the notes on top or bottom. These are called "inversions". The chords below are all C chords:
All of the above chords are composed of C, E, and G, and are C major chords.
So, letters only denote major triads or chords. Letters with a lower case m following them denote minor chords. But sometimes there are numbers, too. These numbers describe other notes added to the basic triad of the chord.
Another third may be stacked on top. These form 7th chords, as these add the seventh note of the scale above. They may be of the Major 7th or the dominant 7th variety. The major seventh is 11 semitones above the root. The dominant 7th is 10 semitones above the root, or one step below the octave. Here are C major triads with major and dominant 7th's added.
The 7th chord built on the root of the C scale has the natural scale note of B natural, and is a Major 7th. It is written with the large M to specify this type of 7th. The chord is assumed to have a major third (E natural). The second one, is the "dominant 7th" chord. Again, it is assumed to be a major chord, as the E is the same as before, but the seventh is lowered.
Seventh chords may be built on each step of the major scale:
As with the triads, the first is major, the second chord is minor, etc. There are no accidentals in these examples. These are the chords formed only from the notes of the scale. Look at the G7. This is the "dominant 7th chord", the second most important chord, next to the "tonic chord", which is C, the chord of the first note of the scale. The dominant chord is built on the 5th degree of the scale. Most songs end with the dominant chord leading to the final tonic chord. The third most important chord is the chord built on the 4th degree of the scale, the "subdominant chord", just below the dominant chord, thus the name "subdominant".
There are still other symbols, +, -, or #, b, that may be added to indicate even more complex harmonies (for example: DM7+11, or A7b9).
This is not meant to be a complete lesson in harmony and chord symbols. I could fill a book with lessons in harmony, but there are many already available. I suggest a look at www.jazzbooks.com for books on harmony and improvisation.