"Machinima" is a misspelled portmanteau of the words "machine" and "cinema." And possibly "anime," depending on who you ask. Its roots lie in the mid-'90s PC game Quake, when gamers began posting demos of themselves playing the game, but instead of playing it the way it was meant to be played, they acted according to pre-scripted instructions, to make videos that followed a storyline. These became known as "Quake movies" and later as "machinima," when other games began to be utilized after the same fashion.
Machinima is simple: instead of painstakingly animating a film frame by frame, you record yourself and other cast members acting out a script inside a multiplayer game. This allows for things which would be expensive, dangerous, or flat-out impossible in live-action, and saves both money and time spent animating. Probably the first example of machinima to achieve mainstream success would be Red Vs. Blue: The Blood Gulch Chronicles.
Created inside a multiplayer map belonging to the science fiction first person shooter game Halo, Red Vs. Blue tells the story of two opposing teams, one red, the other blue, who struggle for control over a tiny, strategically unimportant box canyon. They're not really sure why they're fighting one another or why it's so important to seize Blood Gulch, and in fact the first few episodes are mostly dialogue, as each respective team bickers amongst themselves. When action finally does start, the Red and Blue teams tend to do a lot more damage to themselves rather than each other.
Although the voice acting is a little iffy at first, by Season Two, the actors have grown into their roles nicely, and the writing team has improved their already-snappy dialogue. What starts out as a minimalist, dialogue-driven farce along the lines of Clerks quickly learns to utilize the potential of its software engine and becomes a truly engaging sci-fi comedy. The characters take on unique personalities, and the storyline incorporates more and more complex concepts, like dimensional teleporting, renegade artificial intelligence, mercenary politics, and time travel. Some characters grow on you more than others; main character Church becomes more and more of an unlikable asshole - probably a deliberate writing choice - while Private Caboose eventually reaches a point where every single thing that comes out of his mouth is pure brain-damaged gold. And that's to say nothing of the myriad characters who parody the troll-like behavior on some player-vs-player game servers who pop up in the first couple of Season 3 episodes, which may be the funniest Red Vs. Blue episodes of all time.
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There are long, slow stretches where the comedy suffers due to the complexity of the storyline, but the production company, Rooster Teeth, usually seems to identify when these stretches go one for too long and reels the plot back in to something simpler and funnier. Consequently, some seasons are better than others. But they're all good enough to keep watching, and when you take into account that the people making the series started off with no animation or film experience whatsoever, it really is interesting to see them grow into a sharp, professional-quality production unit. And all this from a bunch of guys whose logo is a play on their trademark insult "cockbite."
Season 9 starts soon. I'm looking forward to it.