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Utilizing content created by algorithms rather than human made content. Often utilizes a "seed," a relatively small string that is used to control the randomization algorithm that generates the entire world.

PROCJAM is the Procedural Generation Jam, an annual event about making things that make things.

http://www.procjam.com/

Sprites are generally 2D images used in games to represent objects. They can be animated or static, and come in different styles like isometric or top-down.