As a film term, continuity refers to an illusion that filmmakers often find desirable to maintain. It is the illusion that the events of the fictional world (those that reside in the diegesis) are occurring in a continuous sequence which the camera is capturing and presenting for the audience to view. This is an illusion because in most instances a fictional film is made up of discontinuous takes, taken from different angles at different times, often shot out of sequence and assembled to match a fictional chronology.

Continuity is usually maintained, to the greatest extent possible, within the context of a scene, whereas the transitions between scenes (whether they are abrupt cuts, wipes, or dissolves) are generally allowed to break the illusion of continuity, especially for the sake of an ellipsis of time.

Continuity is generally considered to most closely resemble our daily experience of reality, in which we perceive that objects don't usually appear, disappear, radically transform or reconfigure themselves instantaneously, and that events generally proceed in continuous time, with a logical cause and effect relationship. In other words, we live in a world that appears continuous, so the illusion of continuity in a film renders that film, not only realistic, but comprehensible.

If a film were made that showed no evidence of continuity, then it might produce such an unsettling effect that humans may not even be capable of grasping what is seen, as the shots would bear no logical relationship to one another (though this may qualify as a perfect example of a subrealist film).

It should be noted that there is a strong relationship between continuity and editing, in that every edit represents a visible discontinuity, which various practices in the development of editing theory have attempted to reduce or eliminate. The efforts to minimize the discontinuity caused by editing have resulted in a standardized, mainstream editing approach referred to as "invisible editing." This practice relies mainly on the matching of adjacent shots based on their visible content, composition, lighting and color, continuation of motion which begins in one shot and carries through to the next, and so on. Audio continuity, sound bridges, ambient tracks, and music can contribute to the illusion of continuity as well.

Certain forms of narrative discontinuity were introduced into films, even in the earliest days, and have come to be accepted and integrated into mainstream practice, though they seemed startling at first. The idea of cross-cutting between actions occurring simultaneously in different locations was considered a radical innovation at the time of a film such as Edwin S. Porter's The Great Train Robbery. This approach depends upon the audience's ability to imagine that the cross-cut scenes occur within a continuous universe that extends into off-screen space, where events will develop whether we are present to view them or not. This is a challenge to the solipsism of the viewer, when we know that in fact the film world is created expressly for the sake of our experiencing it.

D.W. Griffith took the cross-cutting concept even further in Intolerance, in which he cut between events in different eras, among characters in widely distant countries. The cross-cutting was based on logical relations between scenes, rather than spatial or temporal relations, thereby taking the idea of acceptable narrative discontinuity to a new level, suggesting that cinema has the power to communicate on a different plane from the standard continuous perception of our everyday lives, and implying that this unique form of communication comes from the very fact of cinema's discontinuous structure.

Besides the cross-cut, other standardized forms of narrative discontinuity that have come to be accepted include the flashback, flashforward, and the dream sequence. The exploration of subjective points of view, which can be reevaluated, and presented in alternate ways, as typified in Akira Kurosawa's Rashoman also breaks with continuity, in that it violates the notion that the film can present an objectively continuous world, rather than a world with an implied point of view. When a film becomes subjective in its presentation, then it tends to develop through psychological associations that cut across space and time. Is this sort of association more or less "real" than the concrete realism implied by traditional continuity? It is unclear, but there is certainly an unresolved tension between the two approaches.

Although this analysis departs from standard notions of the theory of continuity, and may be regarded as tangential, consider the classic Japanese silent film A Page of Madness directed by Teinosuke Kinugasa. This film, which has been described as impressionistic, depends so much on subjective point of view, that it virtually eliminates any notion of an objective concrete world, the sort of world that film continuity was designed to represent.

There are many ways that the illusion of continuity can be broken, either deliberately, or accidentally. The most obvious would be a change in the existence or presence of an object within the scene. Consider what would happen if an actor was wearing a hat in one shot, then he was bareheaded in the next, and yet we were expected to believe that these shots were taken in a continuous sequence. Unless we were encouraged to believe in the magical disappearance of hats, this sort of change would absolutely shatter the illusion of continuity. In order to keep this from happening accidentally, film productions usually employ someone who is responsible to track the continuity of objects and their position, between shots. This task usually falls to the script supervisor.

A jump cut can produce an obvious temporal discontinuity. Because there is a very visible change in the content of the scene, without a corresponding change in the angle of the camera's position, it becomes obvious that some part of the film has been cut out. This causes the viewer to wonder what happened in the "in-between time" that existed in the missing footage. Therefore, the illusion that what is being seen occurs in continuous time is again broken.

More and more, jump cutting has come to be accepted into the standard vocabulary of film editing, especially when it is used to show an ellipsis of time, to create a sense of disorientation, or to create a verite feel. Ironically, the honesty of the jump cut has come to represent a different sort of realism, as it resembles the footage of a documentary that lacks b-roll for cut-aways.

The most often cited example of a film that embraces the jump cut as an alternative to traditional invisible editing is Jean-Luc Godard’s Breathless.

Crossing the line, or breaking the 180 degree rule, does not create any sort of temporal discontinuity. However, the fact that it can be disorienting, and that it draws attention to the presence of an edit in violation of the rules of invisible editing, does imply a sort of spatial discontinuity, which weakens the impression of an objective world without point of view. But this is infinitely debatable, and many notable filmmakers, such as Yasujiro Ozu have proceeded as though the notion of crossing the line is entirely irrelevant. If anything, they behave as if a 180 degree change in camera position is more natural than a rule that arbitrarily forces the camera to stay on one side of the scene.