Hi,

Severity & Priority will be given by the tester while logging the defects. and it shd be approved by his/her superior.

Severity defines how worst the functionlity is working.

Priority defines how fast the reported issues shd be fix.

(if defect is a showstopper then it will be critical&high like wise we have to assign)

and more over these will be depend on test case priority also.

while fixing the bugs developers mainly concentrate on these two areas to filter and fix the bugs.