Nine Tails Demon fox is a mischievous demon fox in Shinto lore and it either has three tails, or six, or nine. The more tails it has, the more powerful it becomes. Its most powerful form is its nine tails forms. Every tail carries chakra/spiritual energy. Since Kishimoto has borrowed several elements of Shinto Lore, it's safe to assume that the more tails a tailed--beasts has, the more chakra it possesses, and in turn more power.