Understanding background, middleground and foreground in a painting is key to realism in landscapes. Using the three correctly creates depth which is one of the most important parts of creating a successful landscape painting. Paintings without depth are flat and boring.
Another term used to represent back, middle and foreground is layering. The artist should plan what subjects will be in the painting. By subjects I mean anything, sky, trees, hills, mountains, etc. When you layer you simply put one item in front of another.

Lets start in the background. If your painting has a sky, this will be the first thing painted. I usually start by wetting the sky with white gesso. Add whatever color you are using to the top and blend downward. This will create a lighter color near the horizon giving the illusion of depth. The next layer in the background should not be of much detail either. Mountains, for example should be a color just a little darker than the sky. The further away you want them to appear will determine how much detail you give them. You could add more layers of mountains with peaks overlapping for more depth. Each mountain or layer that you add will be slightly darker that the previous.

A good example of middle ground layering using the same example could be by adding a middle ground row of bushes and trees. Again, use a color slightly darker that the closest mountain. Paint in the trees, bushes or fields. Paint in a few tall trees that extend up in front of some of the mountains. This will make the mountains or background really look like they are in the distance.
The foreground layer of the painting will contain the most detail and should be the darkest or most vivid in color. I usually add an eye stopper on both sides in the foreground of my paintings. An eye stopper is simply a bush or tree or something that keeps the eye from wanting to go off the painting. It keeps the viewers attention in the painting. Items in the foreground will contain the most detail. For example, if you have some leaves on trees that are to appear very close, you might add a few simple lines in the leaves to appear like veins or a tiny rain drop ready to drip.

Remembering and using these layering techniques will make your paintings appear more realistic and appear to have depth. It is a simple concept that should add life to your landscape painting.