Daimyō refers originally to individuals wielding influence at the local level. 

In the Sengoku period, certain individuals achieved higher levels of income (measured by rice yields known as koku), status, and authority by strengthening control over their territories. 

Shugo, or military governors, were appointed by the Muromachi bakufu to fulfill the military needs for each province. 

Shugo having heightened levels of control over their respective provinces were known as shugo daimyō, while those whose authority extended beyond their home base to encompass other provinces became sengoku daimyō.