Characters and monsters can have resistance to damage types. For each point in damage resistance, damage of that damage type is reduced by one. Keep in mind that resistance is always calculated last in the damage calculation.

Example: A bandit shoots a fire arrow at Mirai. The fire arrow deals 5 physical + 6 fire damage. Mirai is behind cover, so the damage is halved to 2 physical + 3 fire damage. Furthermore, her magical robe gives her a fire resistance of 2 which reduces the fire damage to 1. In total, she takes 2 + 1 = 3 damage.