Who can succeed to a Peerage is determined by the terms of the Letters Patent or
Charter of Grant. Some are solely to heirs-male, which is often why titles are
said to become "extinct", when the line runs out of men. Others can be very
open, almost allowing descent to any heir of the original grantee. There have
been several cases where the Crown has re-granted a Peerage in favour of a
son-in-law, but as yet Adopted and Illegitimate children have not counted in the
matter of succession. It has always been possible for the Crown to legitimise an
illegitimate son in order for him to succeed to a title. There are 5 ranks of
Hereditary Peers, namely; Dukes, Marquesses (spelt Marquises in Scotland),
Earls, Viscounts and Barons (in Scotland referred to as "Lord").
Until 1707 titles created were either English or Scottish. After the Union of the Parliaments in 1707, no more English or Scottish titles were created, all grants being "of Great Britain". By then all 5 ranks of Peerage had become popular in their usage. After 1801, all peerages were granted "of the United Kingdom" and that is the status of any grant to this day. Irish Peerages were in a different category and were granted until 1801, when they became "of the United Kingdom".
Until their reform later this year, Hereditary Peers are entitled to sit in the House of Lords and take part in the revisal and creation of Legislation there. Peers are not presently permitted to vote at General Elections although they may vote at Local Government and European Parliament Elections. They will be permitted to vote in the forthcoming Scottish Parliamentary and Welsh Assembly Elections. Irish Peers do not sit in the House of Lords, unless they also hold Scottish, English, British or United Kingdom Peerages.
Since 1876 Life Peerages have been granted to senior judges and since 1958 Life Peerages have been granted to eminent people in public life. Life Peerages are almost always granted in the rank of Baron/Baroness and for judges, it enables them to sit on the Judicial Committee of the Privy Council/House of Lords which is the most senior appeal court for a number of jurisdictions including many former British Colonies.
Dukedoms are usually only granted to sons or husbands of monarchs, but some like Marlborough, Wellington, Westminster and Sutherland have been granted to great soldiers or Landowners/Statesmen. Marquessates have usually been "promotion" for existing peers and were popular rewards in Victorian times for Governors-General and Viceroys. Earldoms were the reward for great soldiers and landowners beginning around 1066 and Viscountcies were a popular reward for successful admirals like Horatio, Viscount Nelson. Barons were granted to all others, though some Scottish and English Baronies are very ancient and are often held by those with higher ranks of title, granted more recently. There is much more to say but you will have to download the entire article to find out.