"Feudalism" is a term that describes a social system that went hand-in-hand with an economic system knows as "manorialism." Like all things, feudalism varied by time and place. For example, feudalism didn’t take hold in England until the invasion in 1066. Feudalism didn’t end in France until the Revolution in 1789 and didn’t end in Russia until the Revolution in 1917.
Under manorialism, the lord (that’s a catchall; he could be a Duke, Earl, Knight, etc) of the land (manor) was supported economically by the people that lived on the land. In return, the lord had to provide protection in times of war, food in times of famine, etc.
Feudalism dictated the relationships between the lord and those dependent upon him (vassals). There was a hierarchy of peasants, for example. Slaves were at the bottom (and there was slavery in the Middle Ages, though it’s not often discussed), and of course they could be bought and sold.
Serfs, the next step up, could not be bought and sold, but they were bound to the land. They could not leave the land. In England, many would run away to London; if they managed to live in London for a year and not be caught, they became free men, and could stay.
Next were villeins — tied to the land, like serfs, but with more rights, like freemen. This word is related to villain.
After that, closer to the top, were freemen. They could move if they wished, and had more rights.
What kind of rights? For example, the number of days one had to work on the lord’s land. A serf might have to work 5 out of 7 days on the lord’s land, leaving just 2 days for his own farming. A free man might only have to work 3 out of 7 days. Status also dictated things like amount of money/taxes owed, amount of crops, how much one had to pay to the lord in order to marry, etc.
In the United States, we learn about settlers living on their own in the wilderness, a small cabin on a big plot of land. As a result, we often view medieval people that way. While certainly some people lived on their own, most people lived in villages — it was safer (there were bandits, Vikings and other invaders, plus dangerous animals like wolves). As a result, farmers would then travel to the fields located outside of the city/village (see the Tres Riche Heures images what this actually looked like, at least in the early 1400s).
(Also, this meant labor was often divided — for example, one person would bake, one would brew beer — it was rare for one housewife to complete every single chore all by herself. She usually traded with her neighbors.)
The land was divided into strips so that no one person had all good or all bad land. Your status determined how much land you had for your own use. Most animals and equipment were held in common. Around the year 1000, the “three field system” or crop rotation became widespread practice. This meant that every season some land was allowed to “rest” — it wasn’t planted repeatedly (this depletes nutrients). This led to larger yields, which meant more food, and in turn a population explosion in Europe.
Anyway, the lord of the land lived in a dwelling — a manor house, a great hall, a castle. It had to big enough to house all of the villagers in times of trouble. Over time, the buildings became more elaborate and adorned with towers, etc. But the earliest buildings were simple stone structures (compared to a villager’s wooden, daub, and thatch house). (Daub was a mixture of sand, clay, dung, and other such materials, and thatch was usually straw.)
The lord was also in charge of legal disputes.
Under feudalism, everyone owed someone else. Serfs and villeins, tied to their land, only had one master. But higher ups could owe allegiance to one or more different people. A duke might be beholden to two earls. The duke would owe his lord (be it another duke, an earl, the king) military service and a number of soldiers. Sometimes he would owe food, taxes, etc.
Looking at Dragon Age: the knights are vassals of Arl Eamon. Eamon, in turn, is a vassal of the crown. The knights might have their own vassals, too. The knights owe Eamon service, and Eamon owes the crown his knights.
Awakening is pretty interesting because it does a good job showing this — the Warden has to deal with legal disputes and make his/her vassals (the banns) happy, and decide what contracts of Howe’s to uphold. This is all quite realistic.
I hope that wasn’t too confusing. :)