In a traditional role-playing game such as Dungeons & Dragons, an NPC is controlled by the gamemaster. Non-player characters populate the fictional world of the game, and can fill any role not occupied by a player character (PC). Non-player characters might be allies, bystanders or competitors to the PCs.
NPCs vary greatly in importance, from the NPC innkeeper seen once by the player characters, to the NPC arch-nemesis who comes back time-after-time again for an entire campaign. While every inhabitant of the game's world except the PC's are NPC's, very few are given any detail by the gamemaster (GM). In fact, most of the minor ones are invented on the spot as needed—doing this well is in fact one of the hallmarks of a good GM. There is some debate about how much work a gamemaster should put into an important NPC's statistics; some players prefer to have every NPC completely defined with stats, skills, and gear, while others define only what is immediately necessary and fill in the rest as the game proceeds. There is also some discussion as to just how important fully fleshed-out NPCs are in any given RPG, but it is general consensus that the more "real" the NPCs feel, the more fun players will have interacting with them in character.
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