Here's how it works:
* "No." refers to the hardness of the lead.
* "2" indicates a medium-hard lead that's a good general-purpose choice for writing and drawing.
The "No." system ranges from 9H (the hardest) to 9B (the softest), with "2" sitting in the middle.
So, "No. 2 Pencil" is just a convenient way to say "a pencil with medium-hard lead."