From Halopedia, the Halo Wiki
Theater is a new feature for users in Halo 3 and Halo 3: ODST. It allows them to access saved films of all Campaign, Matchmaking, Custom Games, Forge, and Firefight games that they have played. The 25 most recent games are featured under "Recent Films" in Halo 3. Users are in control of the gameplay footage they played; fast forward, slow down, pause and taking screenshots from every film. The films that users are fond of can even be saved into a library of films.
Film clips are recorded sections of a film, only usable in Halo 3, not in Halo 3: ODST. Pressing "Y" during a replay enables you to move around as in a regular film. However, these are only collections of game information readable only through the Xbox360 and cannot be used on a PC using just an Xbox 360 and a copy of Halo 3. Screenshots, however, can be saved to a computer as an actual image if posted from a file share on Bungie.net. Popular or highly rated films will be shown in the Bungie Favorites list.
- Many people have saved their films onto a computer. This, however requires the use of a capture card which records TV onto a computer.
- Even though you can save clips and rewind in the Theater on the Multiplayer games played, it is not possible to do either in the Halo 3 Campaign games. This is because the loading sequence in Campaign is linear, and rewinding will make the film have to load the process again. For Film Clips, Bungie explains that it just doesn't work well in Campaign.
- If you pause a Theater film while a character is speaking, he/she will still continue to speak until the end of that sentence, and if that character is present at the scene, their jaws (or mandibles for Elites) will still move, but nothing else will. This can cause a glitch where Truth's hologram will appear, and he will make his speech while you have the game paused, and then when you press play, he will make gestures that originally sync with the speech, but without saying anything.
- This is also true for running the video at faster or slower than normal speed. Rather than slowing down or speeding up the sound, which would change the pitch, it simply plays the sound whenever it starts. So if the footage is slowed, sounds are spread apart, where if it is sped up the sounds are compressed, with more sounds playing at the same time.
- A similar glitch happens when you fast forward through a section with much dialog. Some lines will play before they are supposed to, resulting in overlapping sentences.
- Halo 3 is said to be mostly made for movies and machinima because of the theater option.
- Halo 3's theater mode has made it far more easier to film machinima because of more free camera movements as opposed to Halo:CE and Halo 2 machinima that are made with a hypercam and the standard HUD view.