Okay, more terms I didn't know. (How long have I been doing this stuff? And I still don't know these things? I feel like I need to take some sort of GED exam, study a text book day and night and pass a test to catch up).
From what I understand, this refers to a sort of middle step between kata and randori, which I knew always existed, I just didn't have a name for it. The rolls of uke and tori are agreed upon beforehand, and uke is usually compliant.
Despite being a "freestyle" sort of exercise, I mostly do jiyu waza with some sort of limit, i.e. limited types of attack (only releases, or only shomen ate, etc.), or in some cases, limited to variations of just one technique. It's a wonderful training method that I'd like to do more of, actually.
(Literally: taking/grasping chaos) Whereas kata resides at one end of the spectrum where everything is known (we know who uke is, what the attack will be, which hand, and what the technique will be), randori lies at the complete opposite end, where nothing is known.
We start with an uke, who attacks however they like (within reason) and is trying to overwhelm tori, with varying levels of resistance. The "roll" of uke and tori are often lost, or at least change hands back and forth, much like a game of catch. This obviously is much harder training, that has more potential for becoming a little scrappy!