Atmospheric extinction is the term used to describe any removal of radiance from incidence. This removal can be due to scattering events that scatter radiance out of incidence or due to absorption events that directly remove the radiance via transformations of the radiant energy to another form.

Consider the radiance incident on the observer from the top-right of the frame. The optical path is measured from the top of the image downward to the bottom of the image. We hope to recover the radiance (or flux or energy or counts) that would be detected at the so-called top-of-the-atmosphere.

If the atmosphere was absent any radiant sources or sinks, there would be no change to the radiance along its optical path. See spectral radiance for a refresher. $$dI = 0$$