Magic is a skill used primarily to attack enemies, or other players in the badlands. It is also used to cast spells. Some of these spells help in fights, while others teleport you to new locations. More spells may be introduced in the future.
Magic items include:
In Fordana, magic wands could cast spells similar to now, but the spells were different, including the ability to light dark areas, now done with Arson, or heal, which was also done by the doctor and food. Magic spells also damaged enemies, but not in the same way as wands do, now. As characters levelled, new or more powerful spells became available. The wands would then break and turn into gem dust that had to be recharged. Magic Robes were clothes that could be bought at the Magic Guild, giving both weapon and armor. Teleports worked about the same way as they do now.
Shortly after Fordana became Queville, magic was updated. Wands no longer broke, and were used only for fighting. The Illusionist Mages clan used this as a boost to rival early Anarchy. Since wands no longer broke into dust, it was removed from the game or magically changed into new items. Spells still effectively become more powerful as characters level, because they have better equipment available, but there haven't been any new spells for a while. There have been new skills, instead.
There is again going to be a magic update, so the current article may be referred to in this section before long. ;)