UTXO is the acronym for the Unspent Transaction Output.
The only way you can get coins is by a transaction, and this transaction is:
In both cases, the transaction has a list of output addresses along with the amount of coins that should be sent to that address. This list is called a "list of outputs".
A usual transaction has also a "list of inputs", where the coins are taken from, and this list consists of the outputs of one or more of the previous transactions, so the outputs of one transaction eventually become the inputs of the others. Coinbase transactions are unique in this sense and do not have inputs. In these cases, outputs from coinbase transactions "appear from thin air".
So when you, say, want to send 1000 Kaspa to a certain address, the 1000 Kaspa is gathered from the outputs of one or more of previous transactions in which your address was described as the output address. After that transaction is completed, you are losing outputs that are spent (and a transaction recipient acquires 1 new output), but you (hopefully) still have some outputs from other transactions in the past. These outputs in your possession are called Unspent Transaction Outputs — UTXOs.
Note that UTXOs can't be spent partially — only completely. So when you want to send 100 Kaspa, but you only have a UTXO of 500 kaspa that is acquired as a reward for finding a block, there's no other way than to spend this UTXO completely. When sending 100 Kaspa of it to a desired address from a 500 Kaspa UTXO, you will get 400 Kaspa back, as change, to your address. So, on one hand, the law of UTXO spending isn't violated (the UTXO is spent totally), but on the other hand you don't lose anything excessive: you're getting your change back (usually to another address, generated automatically, called a "change address" — this is done to improve your privacy, so no set of transactions can be easily linked to you by a common change address).