Grading System

Mint (M)

Vinyl

Absolutely perfect in every way. Certainly never been played, possibly even still sealed

CD

Perfect. No scuffs/scratches, unplayed - possibly still sealed.
Insert/Inlay/Booklet/Sleeve/Digipak: Perfect. No wear, marks, or any other imperfections - possibly still sealed.

Near Mint (NM or M-)

Vinyl

A nearly perfect record. The record should show no obvious signs of wear. A 45 RPM or EP sleeve should have no more than the most minor defects, such as almost invisible ring wear or other signs of slight handling. An LP cover should have no creases, folds, seam splits or other noticeable similar defects. No cut-out holes, either. And of course, the same should be true of any other inserts, such as posters, lyric sleeves and the like. Basically, an LP in near mint condition looks as if you just got it home from a new record store and removed the shrink wrap. 

CD

Near perfect. No obvious signs of use, it may have been played - but it has been handled very carefully.
Insert/Inlay/Booklet/Sleeve/Digipak: Near Perfect. No obvious wear, it may have only the slightest of marks from handling.

Very Good Plus (VG+) or Excellent 

Vinyl

A Very Good Plus record will show some signs that it was played and otherwise handled by a previous owner who took good care of it. Record surfaces may show some signs of wear and may have slight scuffs or very light scratches that don't affect one's listening experiences. Slight warps that do not affect the sound. The label may have some ring wear or discoloration, but it should be barely noticeable. The center hole will not have been misshapen by repeated play. Picture sleeves and LP inner sleeves will have some slight wear, lightly turned up corners, or a slight seam split. An LP cover may have slight signs of wear also and may be marred by a cut-out hole.

CD

A few minor scuffs/scratches. This has been played, but handled with good care - and certainly not abused.
Insert/Inlay/Booklet/Sleeve/Digipak: Slight wear, marks, indentations, it may possibly have a cut-out hole (or similar).

Very Good (VG)

Vinyl

Surface noise may be evident upon playing, especially in soft passages and during a song's intro and fade, but will not overpower the music otherwise. Groove wear may start to be noticeable, as with light scratches that may affect the sound. Labels may be marred by writing, or have tape or stickers attached. The same will be true of picture sleeves or LP covers. However, it will not have all of these problems at the same time.

CD

Quite a few light scuffs/scratches, or several more-pronounced scratches. This has obviously been played, but not handled as carefully as a VG+.
Insert/Inlay/Booklet/Sleeve/Digipak: More wear, marks, indentations than a VG+. May have slight fading, a small tear/rip, or some writing.

Good (G), Good Plus (G+)

Vinyl

Good does not mean Bad! A record in Good or Good Plus condition can be put onto a turntable and will play through without skipping. But it will have significant surface noise and scratches and visible groove wear (on a styrene record, the groove will be starting to turn white). A cover or sleeve will have seam splits, especially at the bottom or on the spine. Tape, writing, ring wear or other defects will start to overwhelm the object.

CD

There are a lot of scuffs/scratches. However it will still play through without problems. Insert/Inlay/Booklet/Sleeve/Digipak: Well worn, marked, more obvious indentations, fading, writing  tear/rip.

Standard Jewel Cases: Standard Jewel Cases are not graded as they are easily replaceable.