Ethan answered...

I like to approach questions by looking at the words of things

"priest" has reference to either the concept of one who leads, one who is elder, or one who is holy I like to remember that the words 'holy' and 'whole' are linked by a common ancestry. When something is 'holy' it's essentially saying that it's complete, that it's healthy..

And "-hood" makes reference to the state of being, and not just any state of being but a state of being that's worthy or correct for it's placement. That is, that it's done properly.

So one could say the priesthood is leadership or a point of reference that's completely suited to the position in which it's been placed.

Another way to look at it is to say it's God's perfect order. That is, it's God's perfect arrangement.

In our Church we often give a definition of priesthood as being "the authority to act in God's name" and that's exactly what it means to be a part of God's perfect order. If God commands something to be done by you, and you do it, then you are acting under, and with that portion of God's authority that he's permitted you to exercise within his perfect order.

Just as with any instance where someone tries to act in the name of someone else there are bound to be those who try and do so falsely. That's why God has things ordered in such a way that one can know for certain if someone has His God's authority, or not.