Theta is in radians, and it the displacement from vertical.
Proof: if the circle is radius R, how far do you travel if you go once around the circle? 2 pi R. Distance x = 2 pi R. 2 pi is also the number of radians it takes to go once around a circle. Well, what if you only went a quarter of the way around the circle? That's a quarter of 2 pi, or pi/2. You'd have traveled a quarter of the original distance too, or x = (pi/2) R. For travel around any circle, distance traveled is radius times radians. X = L * theta.
You can also derive v = omega * R, and acceleration = alpha * R the same way.