Machinima (a combination of machine + cinema) is a word from back in the day, when game modders hacked demo files to create little movies. After the Quake2 era, they sort of fell by the wayside after demo files weren't editable anymore. Luckily for them, Valve has brought it back! Go watch A Few Good G-Men right now for a fantastic example of Valve's 'digital actors' technology - it pays good homage to Aaron Sorkin.