In the series, a scouter's primary purpose is to calculate the individual power level or ki concentration of biological characters by converting the readings into numbers. It is never explained what units of measure are used to read ki levels; Akira Toriyama simply stated in an interview that it couldn't be done by conventional means.
Saiyans locked by a Tuffle's scouter   Scouters also serve the purpose of gathering information, and for interstellar communication, as seen when Raditz sent Piccolo's description of the Dragon Balls to Nappa and Vegeta, as well as Frieza learning of the existence of the Namekian Dragonballs from eavesdropping on Vegeta's conversation with Nappa. Vegeta also used his scouter to keep track of the time after he said he and Nappa would give the Z Fighters three hours for Goku to arrive. Scouters can also tell the location of someone, as demonstrated when members of the World Trade Organization use scouters to hunt down enemies.
Turles with a red scouter Added by Beadtmdc A scouter appears as a semi-transparent colored monocle that covers the left eye. The first scouter to be seen is the one Raditz wears in the first episode of Dragon Ball Z upon his arrival on Earth. The power level is given as a number without any units of measurement (5 for the farmer, 334 for Goku before he took his heavy clothes off, etc). It is believed that if one is putting out an enormous amount of power it will explode, though the range of scouters throughout the series has varied. The most frequently seen color is green, though alternate colors of red and blue also exist. It is unknown if the color of a scouter has any significance.
Tarble's scouter breaks  Though it is possible to sense others' ki without advanced machinery, as the Z Fighters do, scouters provide the ability to read power levels to less-trained fighters. Scouters do have some disadvantages, however. Their main drawback is that a trained person is capable of consciously lowering their ki (see Power Up), and can therefore fool scouter users into thinking they have a lower power level than their real level. Vegeta speculates that is how Raditz was killed.
Goten and Trunks locked by Abo/Kado's scouter   Another disadvantage is that scouters may explode on certain conditions. The reason for this is not mentioned explicitly in the anime or the manga, but the recorded cases have happened when the scouter is detecting a high power level or when a power level is rapidly increasing, possibly overloading it. Dodoria suggested that it was a problem with older scouter models. Older models (such as Raditz's and Zarbon's) seem to explode when reading levels between 21,000 and 22,000. Newer models (such as Dodoria's and the ones used by the Ginyu Force) can read higher power levels without problems, at least up to 180,000. According to Daizenshuu 7, there are only two generations of scouters. The first generation ones explode when reading a power level over 22,000, something that is corrected in the improved second generation scouters. An example of scouters exploding while someones power level is rising rapidly would be that which occurred to Bulma's (formerly Raditz's) scouter when Goku was fighting Vegeta for the first time. The explosion took place around the time that Goku had used the Kaio-ken time 3, causing his power level to rise at an incredible rate and thus overloading the scouter. It is also possible for scouters to give inaccurate readings, since Raditz believed his to be giving incorrect signals and going haywire when it read Gohan's power level at 710 (in that case, the reading was accurate).