Speaking or acting in character (or IC) means that the words or actions of the player at the table represent the words or actions of their player character in the game world (or of the appropriate non-player character for the GM). Although speaking in character is not a requirement in most role-playing games (an alternative is to describe what the character says or does instead), it is one of the most stereotypical and recognisable parts of role-playing, when the player not only makes choices on behalf of the character but acts as if they are the character. The opposite of in character is out of character. Using a character voice can help distinguish between in-character and out-of-character speech.
A related concept is in-character knowledge, which relates to things that the character knows, regardless of whether the player knows as well. If the character knows (or could know) more than the player, this can be brought into the game by the GM (or other appropriate knowledgable source), perhaps after a knowledge check. However, the term is more often used to distinguish between information that both character and player know (in-character knowledge) from information that the player knows but the character does not (out-of-character knowledge). The distinction between the two can be a source of tension or dramatic irony. A player making choices for their character based on out-of-character knowledge is the definition of metagaming.