Cut out animation is an old and very simple process. Cut out animation tends to be a much quicker process of doing an animation, with the bonus that a fun and quirky film is made from the effect that cut out gives. For example cut out is the style Terry Gilliam uses in Monty Python

The simplicity of cut out lies in how characters are made. Instead of drawing a whole body, bits are drawn instead. The fore-arms, the tops arms, the shins, the thighs, the feet, the hips, the chest, the bottom, the neck, the head, they are all drawn separate of each other. Variables in the character, such as the eyes, the mouth and the hands, have to be drawn for each individual expression. It sounds like a lot of hard work for something that is simple, but once the actual creation of the character is done and the backgrounds drawn, actual animation takes very little time at all. When it comes to the animation, the segments of the body which need to be moved or changed are done so. That process takes quiet literally, two seconds.

This used to be done on paper, cut out, hence the name, and then carefully moved around. However, in the modern age, with the access of computers, it is easier to make a character such as this up in Photoshop which allows for the use of layers.