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Swapping high-detail models for simpler ones when objects are far away, because your eyes cannot tell the difference.
LOD systems maintain multiple versions of the same 3D model at different complexity levels. A character model might have 50,000 polygons up close but swap to a 5,000-polygon version at medium distance and a 500-polygon version in the far background. The transitions happen dynamically as the camera moves. Modern approaches like Nanite in Unreal Engine 5 take this further by streaming individual triangles rather than swapping between discrete LOD levels, making the transitions virtually seamless. Good LOD implementation is invisible; bad LOD causes noticeable pop-in.
Example
Unreal Engine 5's Nanite system, showcased in The Matrix Awakens demo and used in Fortnite's Chapter 4+ maps, handles LOD at the individual triangle level, rendering film-quality assets in real time. Horizon Forbidden West uses aggressive LOD on its massive open world, swapping detail levels on vegetation and distant terrain to maintain performance on PS5.
Why it matters
Without LOD, open-world games would be impossible. Rendering every blade of grass at full detail across a massive map would melt any GPU. LOD is the reason you can see mountains on the horizon in Skyrim or entire cities in GTA V without your frame rate collapsing to single digits.
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