A condition wherein the exercise price of an option is equal (or almost equal) to the market price of an underlying security/ asset.

For example, an option is said to be in the money (i.e., an in-the-money option), and always from buyer’s perspective, it is an option whose underlying’s market price at a given point within its time to maturity (for American options) or at expiration date (for European options) exceeds the combined value of its strike price and the premium (if a call) or whose underlying’s price doesn’t exceed the net value of its strike price minus premium (if a put).