From Gigantic Wiki

Armor reduces all damage taken by 1% per 1 armor, so 15 armor reduces damage by 15%. Most heroes have 15 base armor, with a select few instead having 25 base armor.

Heroes are able to increase their armor with temporary buffs or permanent upgrades. Heroes are able to reduce enemy armor with temporary debuffs, and some hero skills deal damage that ignores armor.

Armor has a soft cap of 65, meaning that stacking armor bonuses can only have a maximum effect of 65% damage reduction. However, the soft cap does not affect single skills that grant more than 65 armor.