For the most part I’ve been figuring this out the hard way I guess…but got to where I can find the root note on a song and figure out the basic notes eventually. Well today I was on Youtube playing with some backing tracks, for guitar, and saw a video listed as 2-5-1 in C. Thinking to myself that looks familiar and then it hit me… the 2-5-1 notes in the scale of C. Hadn’t really studied scales and such but sat here and got the jist of it in just a few minutes…except what is a major scale, and a minor scale. Never been a student of music and now trying to get it all in my brain at one time, heh Oh and where had I seen the 2-5-1 before…on one of the great videos on BassBuzz!..heh heh
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Yeah the Nashville Numbers system finally clicked for me a few weeks back. It was like in the movie The Matrix, instead of just seeing falling green numbers, I started to see shapes within those falling green numbers. I still have a long way to go in order for it to be 3D and in full color, but it gives me confidence I can do it some day.
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@ChrisThomason Now see…I don’t have a clue what the Nashville Numbers system is, unless that’s a name for applying numbers to the different notes? Plus I lived in Nashville for a number of years…heh
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@Redneck Haha yeah its the numbers applied to the notes. Its a system that’s been around for hundreds of years per Wikipedia (can’t image its wrong here) but somehow it got attached in name to Nashville? Anyway, its built to be a simple way of saying the chord progression of a song. The “basic” major scale shape of every major scale is the same. Just depends on what your root note is. So in the C major scale for example the song may have a chord progression of C, F, G. That translates to a 1-4-5 progression. Because in the C major scale, the 1st note in the basic major scale shape is C, the 4th note is F, and the 5th note is G. @JoshFossgreen talks about it without actually talking about it in his Beginner Blues Bass video on YouTube. He just says the 1, 4, & 5 because he’s intentionally pushing theory in some places and in others cutting it out for overall benefit. I wish I could share the video with you that I watched that made it click for me but unfortunately its a paid service. I bet if you look over YouTube enough you’ll find a video talking about it that resonates with you. The reason I say resonates is because I am quite sure I have in the past seen videos talking about it, but it never clicked for me based on the way the instructor was explaining it. So by definition I feel pretty confident I didn’t explain it in a way that makes sense to you either. 
None the less, like I said look it up a bit and I bet you’ll find someone that makes it click for you.
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I believe the Nashville numbering system got its name because it was first used in a recording studio in Nashville.
As others have stated, it’s a simplified way to play chord progressions without having to think about what chords to play. In the key of C, a 1 3 2 5 chord progression would be C, then E minor, then D minor, then G Major. This is where it’s really important to learn intervals. Note, chord progressions usually end on 5, because the triad of the 5th degree (G) resolves so perfectly back to the root note ( C ).
Josh talks fairly extensively about this in one of the B2B lessons, I just can’t recall which.
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Makes sense, Nashville, and L.A., at one time, were the two largest areas for recording studios, and the different musicians that came through. I have seen some videos on using numbers to represent the different notes in scales but they never made sense to me…until today, for some reason. Thanks!..You too @ChrisThomason!
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Module 5 Lesson 2 part 1 is where Josh first mentions intervals. 
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Module 9 Lesson 5 Part 1 of Beginner To BadAss is where he goes over the Nashville Numbers system. Great Lesson, by the way. 
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I think it was all explained quite well, and @PamPurrs had some good extra pointers, but there is a little caveat: you could either talk about the notes (i.e., F is the fourth note from C; which, in reality, is talking about the intervallic relation between those notes), or you could talk about the chords using that, e.g., fourth note as the root of a chord. This is seemingly bewildering, but makes all sense when you ponder it for a little bit. The Nashville numbers refer to chords, thus 2-5-1 should better be written ii-V-I, indicating their major/minor flavor as well, and that they are (often) diatonically related.
So, if you find out the song is rooted in C (major) then the I chord is a C major chord, the ii chord is a d minor chord (hence we write ii instead of II), and the V chord is the G major chord. The beauty of the Nashville numbers is that, if, let’s say, the singer asks for the song to be transposed to B major (instead of C major), everything else still holds. The ii chord is now c# (d flat) minor, the V chord is now F# (G flat) major , and so on. But the progression is still a ii-V-I progression.
By the way, ii-V-I progression are super common turnarounds in jazz, but also funk, rock and pop songs.
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Both @PamPurrs and @joergkutter have answered this very nicely
I constantly have to remind myself of some of these intricacies . . . 
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Muscle Shoals, Alabama was a real hotbed of recording also
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You are quite right, with some great studio musicians that were used there too…
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