A UTXO is an unspent transaction output. In an accepted transaction in a valid blockchain payment system (such as Bitcoin, Bcash, Litecoin, Digibyte), only unspent outputs can be used as inputs to a transaction. When a transaction takes place, inputs are deleted and outputs are created as new UTXOs that may then be consumed in future transactions.
In the Bitcoin network, which uses this model, a UTXO is the amount that is transferred to a Bitcoin address (along with information required to unlock the output amount*) during a transaction. Received amounts (UTXOs) are used individually during a transaction and new outputs are created one for the receiver and, if applicable, one for the amount that is left over (change output). The amount sent to the recipient becomes a new UTXO in the recipients address while the change output becomes a new UTXO in the senders address that may be used in a future transaction.
