UTM parameters, are instructions placed at the end of a URL, to pass information from one place to another. The user activates these parameters when they click on them, and this data is passed to the destination website.
It was born out of a need, to identify different traffic sources. And to enable marketers to get granularity in their traffic data.
These days it is used as a blanket term for any parameters attached to a URL. However UTM does specify a template for marketers to use.
Most analytics systems will detect the UTM parameters and ingest that into their dashboard.