It’s really something you have to see to differentiate, but to me, when the actor is able to make me believe that the character I’m watching onscreen is a living, breathing being, then they have been successful in their job. This can be tricky for anyone to do - acting is not easy - but the reasons why I love Amy Adams, Jake Gyllenhaal and Meryl Streep so much is because I know I am watching Amy Adams, Jake Gyllenhaal and Meryl Streep in whatever it is I’m seeing, but they give such great, believable performances, that they’re able to convince me their characters are their own people, to the point I forget that I “know” who these performers are in real life.
Also, to paraphrase Lindsay Ellis, a good actor is able to convey a lot of information by facial expression and body language alone. Take Sebastian Stan in The Winter Soldier or John Hurt in The Skeleton Key - in Sebastian’s case, almost everything we learn about the Winter Soldier’s character in that film is conveyed purely by Sebastian Stan’s facial expressions and body language, especially since the character himself has only a handful of lines in that film, but Sebastian’s able to communicate so much with just a look. We know when he’s scared, we know when he’s confused, we know when he’s angry, we can clearly see his inner conflict and it’s all thanks to Sebastian’s acting. John Hurt in The Skeleton Key (which is not a good movie, btw, he’s easily the best part of it) is even more impressive because his character is paralyzed throughout the entire film, so he spends all of his screentime acting only with his eyes.
Acting is more than memorizing lines or reacting to stuff, it is about taking something that existed only on paper and giving it life.