An AI-powered virtual character can chat and react on its own.
Old NPCs were talking vending machines. Press A, get the same canned line. Add AI, and the shopkeeper talks back.
You meet them in games and virtual friends. Digital characters use them too, so talk feels natural and back-and-forth.
Digital human
An AI NPC can give a digital human its chat and personality.
Agent
A stronger AI NPC can use Agent skills to plan and do simple actions.
Memory
Memory helps an AI NPC remember you and keep the story straight.
LLM
An LLM is often the language engine for an AI NPC.