Illumination is the only thing that allows us to see what the environment looks like. It is the source of site, and as such, is a vital component of all visual arts. However light is more than a facilitator, it is actually a participant, with the interplay of bright and shadow heavily effecting how we perceive objects, whether it be a portrait, or an entire room.
If you walk into an environment and the lighting is dim, this automatically adds a certain quality to the space. Generally darker areas will be quieter, and more relaxed. We go to sleep in the dark, we are built to rest at night, and so the human body automatically reacts to dark situations with laid back lethargy.
In brighter environments the effect will be opposite. Well lit spaces tend to make people more vigorous and active. You will always find the lighting in an office building bright and abundant.
Light also tends to make people more self conscious. The more you can see, the more you can be seen, and this can cause some people to start worrying about how they appear. That's is why bars, clubs, and parties are often only dimly illuminated; it is a way of helping people lower their guard and feel comfortable in the environment.
One thing to avoid when illuminating a space is going too far with light or darkness. Bathing a room in inky black will make it unusable, but making it so bright that it is irritating to the eyes is just as bad. You need to stay within the thin gradient of usable illumination for optimal effects.
Light is the source of sight. It makes everything in our lives visible. However it is more than just a way to see, illumination can actually effect how you see things, spaces, and people. It is important to consider these illuminated effects when decorating any environment.