In of the Money (abbreviation: ITM) – any option contract that has some intrinsic value (“real” value) and some extrinsic value (time or volatility). This means any call option contract with a strike that is below the current underlying price OR any put option contract with a strike that is above the current underlying price. It can also refer to option spreads, for example an in of the money (ITM) bear call spread would typically mean that both the call option strikes in the spread are below the current underlying price.

If you want more background reading has a really good article that explains instrinsic and extrinsic value.

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