Oblivion:Magicka

Magicka is the magical energy that is used to cast spells.

Your base magicka is determined by your intelligence, birthsign, and race:
 Magicka =  (Intelligence &times; 2) + birthsign bonus + racial bonus
Fortify Magicka effects can be used to increase your character's available magicka above the base value.

Your magicka will go down after casting a spell. It is restored over time at a rate determined by your willpower unless you are afflicted by Stunted Magicka, in which case your magicka will not naturally recover.  The two most common ways to acquire Stunted Magicka are either by selecting the Atronach birthsign or by catching a disease with this effect (in particular Astral Vapors, which can be caught from Dread Zombies). You can also wield the Fork of Horripilation from the Shivering Isles Expansion Pack, which  gives you stunted magicka.  Tips on how to restore magicka when affected by Stunted Magicka are provided on the Atronach page.

Your magicka determines the strongest spell that you can cast.  However, the magicka cost of a spell is also determined by your magical skills (see Magic Overview), so spells that at first appear impossibly expensive can become more affordable later in the game.

 
Character Creation

The following races provide magicka bonuses:
Breton: 50 points
Altmer: 100 points

The following birthsigns provide magicka bonuses:
Mage: 50 points
Apprentice: 100 points (but accompanied by permanent 100% Weakness to Magic.)
Atronach: 150 points (but accompanied by permanent Stunted Magicka)

Maximizing Magicka
Players interested in maximizing their magicka will want to select an Altmer with the atronach birthsign.  Further enhancements are possible by:
The level 25+ Necromancer's Amulet can be worn in place of one custom enchantment.  This amulet fortifies Magicka by 130 points and fortifies intelligence by 14 points.
Enchanting every item with Fortify Magicka Transcendent Sigil Stones (+50 Magicka).  This is the most powerful possible custom Fortify Magicka enchantment.  Nine enchanted items can be worn simultaneously, yielding +450 Magicka.
Wearing the Birthright of Astalon gives +50 Fortify Magicka and also provides the wearer with 5 pts Fortify Agility. 
Possessing the Scales of Pitiless Justice, which adds two points to your intelligence.
Waiting until your Intelligence is at 100 to do the Hermaeus Mora Daedric quest, allows you to get your base Intelligence to 110.

All combined, these would yield a total Magicka of 1032, which is the highest constant effect amount possible in the game without any mods.  Higher values are temporarily possible by also using potions, Doomstone powers, scrolls, and/or spells.

The Official Plug-ins add two possible additional magicka enhancements:
Using the Shivering Isles' Felldew withdrawal exploit allows a possible 15 extra Intelligence points.
From the Knights of the Nine, ''Julianos' Blessing bestows a +5 Intelligence boost.
With these, it is possible for your Intelligence to have a base value of 125, with an additional +21 constant effect enhancement.  The resulting maximum, constant effect value for Magicka is 1072. Note that the Felldew bonuses would need to be obtained before'' any other permanent effects, as the trick relies on Intelligence being under 100 upon leveling.