Ad units are organized into a hierarchy. There's a default "Top level" where you can create new parent ad units. However, you can navigate to an ad unit and create an ad unit at the same level or below the current level.
Child ad units inherit attributes from their parents or from default network settings. You can override these attributes in the child.
The parent ad unit at the top of an ad unit details page displays where an ad unit exists in the hierarchy. The parent ad unit may be defined as "Top level", which means the ad unit is already at the highest level. Ad units at the top level inherit network setting for inventory.