Shortened version of Physics Gun. Used in the game Garry's Mod to move props/objects in the map and freeze them in place after the object is moved to the desirable spot. Typically emits a blue laser and creates a blue halo around the object that is being moved.
Person1: What's a Physgun?
Person2: It's the same thing as a Physics Gun.
Person1: Oh, can I kill something with it?
Person2: It's not that kind of gun.