I have written about Distinctions in the past, ripped from Aspects of the FATE system, but Dungeon World handles the issue in a little different way. Dungeon World asks you to select a few physical traits, and then focuses specifically on the way that your character is connected to the other characters in the game. These connections are called Bonds, and as far as I’m aware, they are pretty unique to Dungeon World. Each character can have several bonds with other characters active at once. A bond is a relationship with another character, generally based on prior sessions (although the system does recommend formats for initial character creation bonds, and recommends structures for those bonds by character class).
One of the ways you gain experience in the system is to test and resolve the bonds you have created with the rest of the group. For example, you may have a bond with another character like, “I do not trust Erik to help me when my life is on the line; I will not rely on him in dangerous situations.” Your bonds should begin with a feeling towards another character, and then end with an action you will take based upon that feeling. As you adventure, your relationships with the other characters should come into play, and change over time as your relationships with that character change in the fiction of the game.
The system actually rewards players for testing and “resolving” these bonds. At the end of a session, you formally gain experience if you have resolved a bond with another player. Resolving a bond means that the relationship has changed or grown in some meaningful way so that the current bond, as written, should be updated or removed. You gain experience and remove the bond, replacing it with a new one.
This system formalizes the personal relationships between each character, and provides a simple mechanic for encouraging those relationships to become dynamic over the course of play.