A holographic avatar is a digital representation of a person in the virtual world of the holoband. Avatars are created by scanning devices upon purchasing a holoband headset, although avatars can be altered so that they don't represent the user's physical appearance. Such is the case with Emmanuelle, an avatar used by Evelyn.
While a majority of avatars are controlled by a user in the real world, Zoe Graystone, who inherited her father Daniel Graystone's brilliant computer skills, found a way to create a fully sentient online holographic avatar of herself, Zoe-A, with all of her memories and experiences - essentially a twin who existed only in cyberspace and could interact with Zoe's separate representation there. After her death in a suicide bombing caused by her boyfriend, Ben Stark, Zoe-A is uploaded by Daniel Graystone into a robot body, the first Cylon, known as Zoe-R. Zoe's program is also used to create Tamara-A, an avatar of Tamara Adama, who died in the same bombing, due to Daniel Graystone's collaboration with Tamara's father Joseph Adama (CAP: Pilot).
When a person leaves the virtual world their avatar will "derez", removing that person's presence in the virtual world. Avatars can also derez due to a number of other factors such as timing out from inactivity, or due to extreme pain from various causes, such as being shot. The only known exceptions to this are Tamara-A and Zoe-A, who will heal over time when shot, but do appear to "bleed" and experience pain when shot. Additionally, any wounds that they acquire appear to display the images from the datastream in place of flesh, further emphasizing their virtual nature. This was shown when Tamara examined herself in the apartment in New Cap City (CAP: "There Is Another Sky", "Things We Lock Away").