Every atomic choice you can make has outcomes. In order to determine which outcome is best, we assign each of these a utility value. In games, we can often use victory points or game currency. But when things get more complicated, we have to make things up.
Early game theorists devised the "util," which is the measurement of utility. It's like calling the "happi" the unit of happiness. Really, it works the same way. Outcomes with more utility are better for the player. In multiplayer games, utility must match for all players.
One major problem with utility comes up when players are involved in slightly different games. If I'm playing Catan to win, and you are playing Catan to let someone else win, then our utility values will not match up at all!