Acrylic Paint
Acrylic is a water based paint which dries in minutes or even seconds, depending on conditions. Unlike many other water based paints, it is not water soluble once it has dried.

Base coat
The first layer of paint which will actually be visible on the finished figure. In the case of most colours this will be a mid-range example of the colour which will later be shaded by adding black and white. In the case of an area which will be drybrushed, it is likely to be black or a very dark shade of the colour.

Blending
This painting technique involves mixing two different colours or shades together while wet to create a smooth transition from one to the other. It produces the best results for shading figures, but is also the most time-consuming and difficult to master.
More info on blending

Brightness
Brightness is the lightness or darkness of the colour, how close it is to either black or white. You can control the brightness of a base colour by adding white or black, but this will lower the saturation. With some colours you will need to compensate by adding another colour, such as yellow or a more saturated paint than that used for the base colour.

Drybrushing
A method of painting which uses a small amount of almost dried out paint to pick out the highlights on a textured surface. It is excellent for fur, hair, metallic surfaces, bases and scenery as well as larger items such as vehicles and buildings.
More info on drybrushing

Enamel Paint
This paint is only soluble in white spirit. It is slower to dry than acrylic which can be a good or a bad thing. It used to be the most widely used modelling paint, but over the past couple of decades, improvements in the quality of modelling acrylics have lessened its popularity.

Highlighting
Shading a figure with lighter tones to pick out the raised areas. This can be done with techniques such as blending or drybrushing.

Hue
The hue is what colour it is (sorry, that doesn't make much sense, but I can't think of another way to put it. Red is one hue, green is another. Grey is not a hue but the absence of both saturation and hue.

Here you can see the full range of hues, which decrease in saturation as they go down the picture until they become grey.

Inks
The pigment in acrylic inks is mixed with a more dilute mixture than ordinary paint. When used for a wash, they will therefore provide stronger colouration, while still being liquid enough to run into the recesses.

Inks also tend to be less opaque than other acrylics.

Luminosity
Another word for brightness.

Opaque
The opposite of transparent, something that is opaque lets no light through. An opaque coat of paint will completely conceal the colours underneath it. Opacity/opaqueness is the quality of being opaque..

Primer
See undercoat.

Saturation
Saturation, also called chroma, is the amount of colour in the colour. It represents the amount of grey in proportion to the hue. When mixing paints, the saturation will always decrease, becoming greyer or browner as more colours are added. Putting white or black with a colour will obviously make it more grey and therefore less saturated.In this example a highly saturated blue on the left becomes less saturated on the right.

Shading
Using different shades of the same colour to create an impression of 3D. Shading is used to exaggerate the natural shadows and highlights created by the figure's shape, and thereby compensate for its small size. It consists of highlighting and shadowing.

Shadowing
Shading which makes the colour darker. Sometimes the word 'shading' is used to denote this but for the sake of clarity, on this site, I have called this shadowing to allow the use of shading as a general term for both highlighting and shadowing.

Transluscent/Transparent
Transluscent and Transparent mean virtually the same thing, except that transluscent things might be frosted and obscure what is behind them.

Transparent paint will let at least some light through, thereby exposing something of the underlying paint. Usually this is not a desirable property in paint, because you are applying the paint to alter the colour of something. However, it can be put to use in shading, and some special effects such as metallics and glass.

Some paints are available which are highly transparent, such as Tamiya Clear, or paints for colouring glass, of which there are a number of brands.

Undercoat/Primer
The first layer of paint applied to the model. It's main function is to provide a good surface for other layers of paint to be applied to and none of the undercoat will be visible on the finished model. Specialist paints are available for this purpose, called primers. These give a slightly more porous surface than ordinary paint, which forms a better base for subsequent coats.
More Info on undercoating

Washes
A wash is a diluted coat of paint which allows previous coats of paint to show through to some extent. The diluted paint also tends to settle into the crevices and depressions in the figure. If the colour used for the wash is darker than the underlying paint, this will provide rudimentary shading.
More Info on washes