Digital noise reduction filters the grain that appears in low light. Two-dimensional DNR smooths each frame, and three-dimensional DNR compares successive frames to remove noise while keeping edges. Strong settings clean up a night image but can smear moving people, so the setting trades clarity against motion.
Noise is what makes a night image look cheap, and noise reduction is the control that hides it. The control is not free: it removes detail along with the grain.
2D and 3D noise reduction
Two-dimensional reduction works on a single frame and blurs fine texture. Three-dimensional reduction uses earlier frames as a reference, so it can preserve detail in still areas and clean up grain more aggressively. It needs care with movement, which is where smearing appears first.
Setting it without losing detail
Start at a moderate level and watch a person walk through the scene at night. If limbs trail or faces lose their edges, the setting is too strong. Pairing the setting with adequate light or infrared usually gives a better picture than pushing noise reduction to the maximum.