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Just wondering how the level that you gain from battle points affects the game, if at all. Is it just an e-peen thing? Is it a match-making thing?

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Means absolutely nothing. – Decency Jan 20 '13 at 20:29
up vote 4 down vote accepted

The only known difference would be that, each time you level up, you get a random item.

But yeah it can definitely be an "e-peen" thing, seeing as they're public, and you get more points for wins. With some thinking you can guess that the level 10 guy with 100 wins probably doesn't have as many losses (and subsequently higher e-peen) as the level 10 guy with 60 wins (because he has a lot of losses to make up for the difference in won games).

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Valve has confirmed that player level is not factored into matchmaking: – Decency Jan 20 '13 at 20:30
Using level to guess about win rates is not very reliable, since the beta was open for a very long time before experience was added. Personally I had over 100 wins before experience was added to the game. – TM. Jan 29 '13 at 5:48
Also, not that its that big, but playing bot games will not count "wins" but do give you battle points. – gnarf Jan 30 '13 at 16:51

Profile levels have a few functions in Dota 2. They determine the tiers of items you are eligible to drop after a match, and for every level up, you will gain a guaranteed new cosmetic item. Certain queues are also enabled depending on your profile level, such as Ranked matchmaking which is enabled at level 13.

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