Stamina respresents your strength. Low in stamina will cause you weaker even walk slower. Like in the real world, heavy tasks make you tired, so your stamina drops fast during chopping down trees or fighting with an animal. Higher stamina does more damages, too. Raining also drains your energy, unless you have a raincoat.

To recover your stamina, eat something or sleep. The max stamina increases as you level up.