The premise of many role-playing games tasks the player with saving the world, or whichever level of society is threatened. There are often twists and turns as the story progresses, such as the surprise appearance of estranged relatives, or enemies who become friends or vice versa. The game world tends to be set in a fantasy or science fiction universe, which allows players to do things they cannot do in real life and helps players suspend their disbelief about the rapid character growth. To a lesser extent, settings closer to the present day or near future are possible.

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The story often provides much of the entertainment in the game. Because these games have strong storylines, they can often make effective use of recorded dialog and voiceover narration. Players of these games tend to appreciate long cutscenes more than players of faster action games. While most games advance the plot when the player defeats an enemy or completes a level, role-playing games often progress the plot based on other important decisions. For example, a player may make the decision to join a guild, thus triggering a progression in the storyline that is usually irreversible. New elements in the story may also be triggered by mere arrival in an area, rather than completing a specific challenge. The plot is usually divided so that each game location is an opportunity to reveal a new chapter in the story.

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Pen-and-paper role-playing games typically involve a player called the gamemaster (or gm for short) who can dynamically create the story, setting, and rules, and react to a player’s choices. In role-playing video games, the computer performs the function of the gamemaster. This offers the player a smaller set of possible actions, since computers can’t engage in imaginative acting comparable to a skilled human gamemaster. In exchange, the typical role-playing video game may have storyline branches, user interfaces, and stylized cutscenes and gameplay to offer a more direct storytelling mechanism. Characterization of non-player characters in video games is often handled using a dialog tree. Saying the right things to the right non-player characters will elicit useful information for the player, and may even result in other rewards such as items or experience, as well as opening up possible storyline branches. Multiplayer online role-playing games can offer an exception to this contrast by allowing human interaction among multiple players and in some cases enabling a player to perform the role of a gamemaster.