Avatar versus character
Also said as Silent protagonist, Player character, Blank slate
An avatar is a blank the player fills: they are the hero. A character is someone else with their own past and voice, whom the player steers. A silent protagonist is the usual way to keep the blank blank.
The choice decides what your writer is allowed to do. An avatar can never surprise the player with a feeling, and a character can say something the player would never have chosen.
Say it
“She is a character, not an avatar. Give her a voice and a sister she misses, and only offer the player choices she might really make.”
Where you’ve seen it
Gordon Freeman in Half-Life and Chell in Portal never speak, so the other characters do the talking at you. Geralt in The Witcher 3 is fully a character: he has a voice and a history, and you decide what he does about it.
Not to be confused with customisation
Choosing a face does not make an avatar. Commander Shepard can look like anyone and still has a voice and a will of her or his own.