The dimension refers to chuck size. Specifically, it refers to how wide the jaws will open and the maximum size shank you can fit. Mind you, that's not the same as the maximum size drill bit, because a one-inch spade bit might only have a 3/8-inch shank.A 1/4-inch chuck will be found on a light-duty DIY drill. A 3/8-inch chuck is the most common size and is used on a variety of models, from modest homeowner drills to high-performance pro tools. Chucks of 1/2 inch are often found on hammer drills.