We investigate the sensitivity to temperature and gravity of the strong absorption features in the J- and K-band spectra of substellar objects. We compare the spectra of giants and young M dwarfs (of low gravity) to field M and L dwarfs (of high gravity) and to model spectra from the Lyon group. We find that low-resolution spectra of M4-M9 stars and young brown dwarfs at R similar to350 and signal-to-noise ratios greater than 70 can determine the spectral type to a precision of +/-1 subtype using the H2O and CO bands and can measure the surface gravity to +/-0.5 dex using the atomic lines of K I and Na I. This result points toward the development of photometric spectral indices to separate low-mass members from foreground and background objects in young clusters and associations. We also emphasize the complexity of the interpretation of the empirical quantities (e.g., spectral types) in terms of the physical variables (e.g., temperature, opacities) in the cool atmospheres of young brown dwarfs.