Radiance is the variable directly measured by remote sensing
instruments. Basically, you can think of radiance as how much light
the instrument "sees" from the object being observed. When looking
through an atmosphere, some light scattered by the atmosphere will
be seen by the instrument and included in the observed radiance of
the target. An atmosphere will also absorb light, which will
decrease the observed radiance. Radiance has units of
watt/steradian/square meter. Reflectance is the ratio of the amount
of light leaving a target to the amount of light striking the
target. It has no units. If all of the light leaving the target is
intercepted for the measurement of reflectance, the result is
called "hemispherical reflectance." Reflectance (or more
specifically hemispherical reflectance) is a property of the
material being observed. Radiance, on the other hand, depends on
the illumination (both its intensity and direction), the
orientation and position of the target and the path of the light
through the atmosphere. With effort, many of the atmospheric
effects and the solar illumination can be compensated for in
digital remote sensing data. This yields something which is called
"apparent reflectance," and it differs from true reflectance in
that shadows and directional effects on reflectance have not been
dealt with. Many people refer to this (rather inaccurately) as
"reflectance." For most of the vegetation indices in this FAQ,
radiance, reflectance, and apparent reflectance can be used
interchangeably. However, since reflectance is a property of the
target material itself, you will get the most reliable (and
repeatable) vegetation index values using reflectance. Apparent
reflectance is adequate in many cases. See the related link.