A cutscene or event scene (sometimes in-game cinematic or in-game movie) is a sequence in a video game that is not interactive, breaking up the gameplay. Such scenes could be used to show conversations between characters, bring exposition to the player, set the mood, reward the player, introduce new gameplay elements, show the effects of a player’s actions, create emotional connections, improve pacing or foreshadow future events.[2][3]
Cutscenes often feature “on the fly” rendering, using the gameplay graphics to create scripted events. Cutscenes can also be pre-rendered computer graphics streamed from a video file. Pre-made videos used in video games (either during cutscenes or during the gameplay itself) are referred to as “full motion videos” or “FMVs”. Cutscenes can also appear in other forms, such as a series of images or as plain text and audio.
source: wikipedia