There are many different Damage Types in Champions Online.
Each Damage type falls into one of these 4 categories:
Defense & Resistance
In Champions Online there is a distinction between defense and resistance.
There are only two values for defense (Energy and Physical). There are many more Resistances than Defenses and yet more damage types than Resistances. The two types of defenses apply to all the damage types that fall within their respective category. Physical damage is affected by your physical defense. Raising your energy defense will increase your resistance to elemental, energy and paranormal damage types.
Resistances apply only to the sub-category or specific damage type named.
An upgrade that gives +50% energy resist will only affect the electricity, sonic and particle damage types. It will not affect any of the paranormal or elemental damage types even though they are considered to be "energy" for the purposes of the energy defense statistic.
All bonuses from items are added together for a total resistance value. If you have 20% energy defense and an upgrade that gives +50% resistance to elemental damage, then your total resistance against elemental damage is 70% (20% + 50%).
Champions Online has diminishing returns for damage resistance. The actual formula used to calculate damage mitigation due to resistances is:
Damage taken = damage / ( 1 + damage resistance )
So if you had a damage resistance of 20% and were hit by an attack that does 1000 damage you would take:
1000 / ( 1 + 0.2 ) = 833.33 damage
This is a total of 16.667% damage mitigated.
This formula is used so that attaining a 50% damage mitigation is relatively easy (100% damage Resistance) while achieving 90% or more is virtually impossible requiring damage resistances of over 900%.