Chiaroscuro is a method for applying value to a two-dimensional piece of artwork to create the illusion of a three-dimensional solid form. This way of working was devised during the Italian Renaissance and was used by artists such as Leonardo da Vinci and Raphael. In this system, if light is coming in from one predetermined direction, then light and shadow will conform to a set of rules.

A hightlight will mark the point where the light is being reflected most directly. This is most often bright white, although in my illustration it is 10% Black. As one's eye moves away from this highlight, light hits the object less directly and therefore registers a darker value of gray. In my illustration there is a regular transition until you reach the point where the shadowed area of the form meets the lighted side.

Here there is a more sudden transition to darker values because no light is hitting that side. Some indirect light is available because the dark side does not turn solid black. This is the result of reflected and refracted light that naturally occurs. As you look at the extreme edge of the form, you will notice that it is markedly lighter than the shadowed area of the object. Light in the environment is illuminating the back edge.

The cast shadows are usually divided up into separate values as well. The area closest to the object is usually the darkest area that is being portrayed. Then, as light becomes more available, the same cast shadow lightens in increments until it reaches the shadow's edge.

Hint: Often times a drawing does not have this exact transition of grays. One can control and manipulate this formula to create interesting moods and character in a piece of work. A High Key drawing is one that has mostly light values, probably with no value of more than 60% at the darkest points. A Low Key drawing would be one that has mostly dark values. In both Low and High Key pieces this system of chiaroscura can be used to create the illusion of three-dimensional space in a drawing.
Hint: How to create shadows in linear perspective.