Essentially, there are two different levels of ‘permanent’ UK immigration status. The first is the acquisition of the right to remain permanently in the UK, and the second is an application to naturalise as a British Citizen, which grants you the full rights of a British national.
Indefinite Leave to Remain
Also known as permanent residence in the UK, confirms your ability to permanently reside in the UK and is usually accrued (by way of official application to the UKVI) after five years continuous legal residence in the UK - without excessive absences of course!
The downside to this status is that it can be revoked should you remain outside of the UK for a period of two years, commit a serious crime, or no longer reside in the UK. Holding this status does not permit you to obtain a British passport.
Generally, British citizenship can only be applied for once you have held Permanent Residence for at least one year (unless you are married to a British citizen and whilst you must hold permanent residence you do not need to have done so for a period of time). If approved, you will be eligible to apply for a British passport.
UK citizenship also allows you the full rights of a UK national and can only be taken away from you under very exceptional circumstances.