Typically it just means that blood is escaping into a space that shouldn’t be filled with blood. In large cavities such as your chest, pelvis or certain compartments in your leg, you can lose a LOT of blood; sometimes without knowing.
In comparison, an external bleed is usually obvious and can be quickly treated.
Treating an internal bleed is much harder since you may need to get inside past viral structures in difficult to reach spaces to stop it.
They also tend to be more severe since a paper cut is only affecting the tiny blood vessels in the skin, whereas an internal bleed may involve a vessel that is a few centimetres in diameter.
Source: med student, top of my head, feel free to correct me!
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