Imagine a jello mould. You know how all the shapes basically face upwards? That's something with no undercuts, where you could basically pull it straight from a rigid mould and nothing would get left behind.
And undercut is basically anything that would prevent this kind of straight lifting out - even just under a pocket flap; basically anything where the master is narrower underneath something wider like under a nose, a visor or helmet rim, the hem of a jacket and so on.
Where there are undercuts either the mould needs to flex to let the casting go or for rigid moulds it would need to be segmented so each piece of the mould can be lifted off at the right angle so as not to catch (and rip off) any area with an undercut. This is how toilet bowls are cast for example.
Einion