Grant A Level
Grant A Level or level gifting is a special feature that allows you to grant a level to a friend who referred you to the Recruit-A-Friend program, and you signed up for World of Warcraft.
For every two levels you gain you get 1 bonus level to grant other players. Levels you've gained from grants will add to your grantable bonus.
Your friend can even grant bonus levels to your own characters!
From Recruit-A-Friend FAQ (page 2 of US FAQ or page 1 of EU FAQ):[1][2]
- Your recruit will need to right-click your target character's portrait and select "Grant A Level."
Notes
As stated on the FAQ page, a single character that has been leveled as a result of the Recruit-A-Friend process can grant up to 42 levels. This means that it's possible to level two characters up to 85 in this manner (thus earning a total of 84 grantable levels) and thus allow the veteran player to create a new character from level 1 and have the two recruited characters grant him levels all the way up to 85.
Also, because granting a character levels does not affect their progress through their current level, you can use this tactic to bring a brand new character straight to level 86. This is because a character that is at 99% experience in level 1 will be at 99% at any level they obtain through granted levels.