It is the measurement of the bore size. The gauge is the number of balls the diameter of the barrel that could be made from a pound lead. So a lead ball weighing 1 1/3 ounces will fit in the barrel of a 12 gauge shotgun (12 * 1 1/3 = 16 ounces), a 1-ounce ball would fit a 16 gauge barrel, and one that weighs 4/5 ounce will fit a 20 gauge. The exception is the .410 which is the actual measurement of the barrel diameter, 41/100 inch.
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