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Transition in which one scene changes gradually into the other. The speed and timing of the dissolve can be used to add meaning to a scene transition.
Also known as a Cross Dissolve.
In the earliest days, dissolves were done in-camera: expose the film while fading out the lights in one scene, wind it back, and shoot the second scene while raising the lights, producing a double-exposed shot. An analog editing bay does much the same job, by fading the light levels used to project the film onto the blank stock.
In video, a dissolve is often called a "mix", because the analog circuitry required works almost exactly like that used in an audio mix, specifically a linear cross-fader. The signals are fed to the same output, but one falls in voltage as the other rises, so the waveform produced is the average of the two at any point.
Digital systems use math -- specifically weighted averaging of each pixel with its counterpart -- but they do everything with math.
A dissolve is often accompanied by a synchronized audio cross-fade, or a Split Edit.