In film, a medium shot is a camera angle shot from a medium distance. The dividing line between "long shot" and "medium shot" is fuzzy, as is the line between "medium shot" and "close-up". In some standard texts and professional references, a full-length view of a human subject is called a medium shot; in this terminology, a shot of the person from the knees up or the waist up is a close-up shot. In other texts, these partial views are called medium shots. (For example, in Europe a medium shot is framed from the waist up.) It is mainly used for a scene when it is desirable to see the subjects' facial expressions in the context of their body language.
There is no evident reason for this variation. It is not a distinction caused by, for example, a difference between TV and film language or 1930s and 1980s language.
A medium shot shows to the audience, the scenery and characters in the scene.