MP3Gain does not just do peak normalization, as many normalizers do. Instead, it does some statistical analysis to determine how loud the file actually sounds to the human ear. Also, the changes MP3Gain makes are completely lossless. There is no quality lost in the change because the program adjusts the mp3 file directly, without decoding and re-encoding.
MP3Gain operates in two modes, Track and Album. Track mode volume-corrects a mix of unrelated songs to a selected level. MP3Gain calculates the volume level for each song individually. It then corrects each song to make its volume level match the Target Volume. Album mode volume-corrects a collection of related songs (as they would appear on a CD, or "album") relative to other collections of songs.
Applying Album gain is like adjusting the volume knob once for each CD you put in your CD player. The overall volume of the album is adjusted to the Target Volume, but the volume differences between the mp3s in the album are preserved. With Album mode, you want some songs to be noticeably quieter than other songs, just like they are on an album. If you're playing a classical CD, you expect the track with the flute solo to be quieter than the track with the big full-orchestra finale. Album mode allows you to correct an entire album while keeping each song's volume level relative to the other songs.