For desktop...
Core i3 is entry/budget level/mainstream bracket and is 2 cores with hyperthreading and no Turbo
Core i5 is performance bracket and is 4 cores without hyperthreading but with Turbo. The exception being 6xx series CPU's (2 core with hyperthreading and Turbo)
Core i7 is enthusiast bracket and is 4 or 6 cores with hyperthreading and Turbo
Core i7 Extreme is enthusiast bracket and is 4 or 6 (and soon 8) cores, hyperthreading, Turbo and unlocked bus multiplier.
Second generation Core i (Sandy Bridge) uses
2xxx numbering.
The differentiation for mobile CPU's is less easy to define (a massive understatement)
See
here and
here for individual CPU characteristics and board compatibility
For desktop look for the names Clarkdale (mainstream), Lynnfield (performance) and Bloomfield/Westmere (enthusiast) on the Nehalem page, while Sandy Bridge isn't differentiated by family name with regards it's market segment.