It’s a term from gaming which, in the broadest sense, means how they paint the sky to make it look authentic. Imagine being inside a cardboard box - the sides are painted to look like rolling mountains and hills, and the top face is painted to look like a cloudy sky, and if it’s done well, all of these should connect up and give the impression that you’re lookint at a real sky.
I don’t generally like AI generated images, but this is great