A Non-Player Character (sometimes "non-playable character" or "non-player class"), often shortened to NPC, is a character on a simm that is not directly under the control of a writer.
NPCs vary greatly in importance, from the NPC innkeeper seen once by the player characters, to the NPC arch-nemesis who comes back time-and-again for an entire campaign. While every inhabitant of the game's world except the PCs are NPCs, 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 and a good, inspired writer in general. There is some debate about how much work should be put into an important NPC's bio; some players prefer to have every NPC completely defined with a personality, history and service record, 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" an NPC feels, the more fun players will have interacting with him or her in character.
NPCs can usually be role played by anyone, so long as if the character has appeared before, then their personality is maintained. In some cases, however, players can, or are encouraged to, create PNPCs or a Player's Non-Player Character. While this may seem confusing, it simply means that the NPC has been created by a PC, and as such it is usually polite to interact with the PNPC by doing a Joint Post with it's creator.