Turbidity refers to the number of suspended particles in a liquid.  Turbidity is tested using a turbidometer, a diagram of which is shown below.  

This turbidometer is also known as a nephelometer.  In the turbidometer, light shines through a sample of water.  If the light strikes a colloid, the light is scattered, bouncing off the colloid and reflecting upward.  If the light does not strike a colloid, it shines through the water sample.  The meter measures how much light is reflected off colloids in the water.  Clear water will reflect little light while turbid samples, like this one, will reflect large amounts of light.