Until now, the dangerous things in the world were dangerous in narration only. You could be told a bandit was blocking the road; you could not do very much about it.
You can now. Enemies stand in scenes as real opponents, and you fight them a round at a time.
How a Round Goes
You act, they act. One thing each, then the round closes and the next one opens.
Who moves first is not random and it is not always you. It comes down to speed — a wolf goes before a man in armour, and there is nothing clever you can do about that except be faster or be ready to lose the opening exchange. Every round is written out as it happens, so you can see what hit, for how much, and what it cost you.
Fights are short. This is on purpose. A bandit on a road should be a decision with consequences, not a ten-minute engagement with a health bar.
Winning
Experience, gold, and whatever the thing was carrying. Loot is not guaranteed and it is not the same every time — some creatures drop something worth having rarely enough that you will remember the one that did.
If a quest asked you to deal with something, dealing with it counts the moment the fight ends. You do not have to go back and tell anyone first.
Losing
You do not die. That needs saying plainly, because a lot of games in this shape do kill you and it changes how willing you are to try anything.
Defeat drops you to your last breath and puts you somewhere safe, and the cost is the ground you lost and whatever you had to spend getting there. Your character, your gear and your story are all intact.
You choose where "somewhere safe" is. Stand in a settlement or another place the realm considers safe, mark it, and that is where you come back to. Change your mind later and mark somewhere else — it is meant to follow you outward as you go, not to drag you back to the first tavern you ever walked into.
What this does to the rest of the game is the interesting part. A road with something on it is now a road you have to think about. A shortcut through a bad district is a real gamble rather than a line of text. And the sword you have been ignoring in your bag suddenly has an opinion about your evening.
Go and pick a fight you can win. Then pick one you are not sure about.