Fiction where game rules are part of the world: characters have levels, stats, classes and skills, and the book shows them, often as text boxes the characters can read. The name blends "literary" and "RPG" (role-playing game).
For new readers
If a book shows you a character's level going up in numbers, it is LitRPG. If it only tells you they got stronger, it is probably progression fantasy.
Dungeon Crawler Carl, The Primal Hunter and Defiance of the Fall are all LitRPG series in our guides.