Priestesses are recruited from the Head Priest and may follow you, or be told to guard an area, like the Archers and Warriors. They tend to move around a larger area when they are told to Guard and will heal any damaged NPC nearby.
If set to follow, Priestesses travel behind and heal you. This is indicated by heart particles near a them. A known bug is when you talk to the Priestess, it says "Priest" which is a male, instead of "Priestess" which is female.
Priestesses can not level up.