That's one way to look at it. It's all about the number of channels.
A basic stereo system (2.0) has of two channels -- right and left -- produced by stereo speakers and typically powered by a stereo receiver or amplifier.
A 2.1 channel system adds a subwoofer to the two stereo speakers. In a home theater system, there's usually a surround sound decoder that creates the sense of sound coming at your from all directions.
A 5.1 system has 5 or more channels of sound. In order to get this, you need an A/VR (Audio/Visual Receiver) to separate the channels and direct them to the appropriate speakers. The five-point-one channels are left and right, like a stereo system, a center channel for movie dialog or music vocals and on-screen sound, and left and right surround channels, for special effects and surround sound. An additional subwoofer channel adds very low bass for music sources and special effects on DVD movie sound tracks. The five main channels plus the subwoofer channel produce a “soundfield” that wraps you with sound coming from in front of and behind you.
But there's more!
6.1 channel systems have an additional rear-center channel speaker for a total of three front and three rear speakers for more precise positioning of sound effects. The sound of an airplane flying overhead is so realistic you want to duck.
And then there's the seriously powerful 7.1 channel system. 7.1 channel receivers have three front channels, two surround channels and two surround-back channels, plus a subwoofer channel. This is the closest you'll come to the true theater experience of sound coming at you from every direction.