The process of creating worlds for use in a fictional tale. Often used by science fiction writers, but really any genre can have its own taste of worldbuilding. Popular tales such as The Wizard of Oz and The Chronicles of Narnia were subject to worldbuilding by their authors. Today, many talented writers use their worldbuilding skills to create planets and galaxies and more for video games (such as The Elder Scrolls series, the Mass Effect series, and countless titles of both big budget and indie origin).
In other words, it's a very common and well-used process. Worldbuilding is a terrific exercise for aspiring writers.
Person A: I wanted to write a story about pirates but I really don't know anything about history...
Person B: That's okay, dude, you can seriously just make up your own locations and planets and stuff.
Person A: Really? But isn't that cheating?
Person B: Nah, it's worldbuilding. It can be pretty fun if you flesh out your world enough.
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