A carat specifically measures a diamond's weight.
A carat equals 0.2 grams. Carats are then divided into 100 points. So a quarter-carat has 25 points and is written as 0.25 carats, or ¼ carat. Because of its rarity, one larger diamond is more valuable than a combination of smaller diamonds.
As you can see from the comparison tool below, a 2 carat diamond does not necessarily look twice as big as a 1 carat diamond does from the top. That's because other factors such as the cut and table size of the diamond also have a significant effect on the apparent size of a diamond.
The video below covers the basics of diamond carat weights.