He is tied for third on the tier list with his brother Mario. Luigi has excellent horizontal movement, high jumps, and good kill power. He has easily the best projectile in the game, the Fireball, due to its very fast speed and firing rate. The Luigi Cyclone is a good turtling move, as it comes out fast, surrounds Luigi on both sides, has a long active period, and has instant-killing properties.
Like Mario, Luigi does not have any real weaknesses, other than his lack of a momentum cancelling attack. This lack of downsides makes his strengths appear event more pronounced, as he has strong match ups across the board, resulting in his high placement.
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The fireball itself behaves very differently from Mario's.
It comes out 3 frames slower (5 → 8).
It travels in a straight line, as opposed to a sine wave.
It moves about half as fast.
This allows it to deal more damage overall due to overlapping the opponent for more frames.
It can also combo into itself at low percents, making it good for damage racking and early edgeguards.
It lasts 15 frames longer (23 → 38).
It travels a much shorter distance.
It does not grow bigger towards the end of its range.
The move transitions into jump attack 1 frame later when used in the air (16 → 17).
Luigi's firing animation does not auto-transition into his falling animation.
This makes it more difficult to spam, as the move will frame-skip into a useless falling animation if the attack button is held down. Luigi must turn-cancel during the time between firing the projectile and his attack refreshing in order to fire at the optimal rate.
Luigi's hurtboxes are bigger overall, especially during the initial frames.
It transitions into jump attack 1 frame later (16 → 17).
Luigi does not auto-transition into his falling animation.
This makes it more difficult to spam, as the move will frame-skip into a useless hurt animation if the attack button is held down. Luigi must turn-cancel before his attack refreshes in order to immediately follow up with a second down aerial.
The attack's hitbox is significantly wider and slightly taller, giving Luigi better coverage and range on the sides.
Luigi's hurtboxes are less consistent, being much bigger than Mario's on average.
This also means that Luigi does not have a disjoint above him.
Luigi has a short "wind up" animation at the beginning, giving him a strong disjoint on both sides during the initial frames.
Luigi does not "hop" at the end of the attack, giving his hurtboxes less vertical movement.