Medium is a world type exclusive to the Console Edition, specifically to the Xbox One Edition and the Playstation 4 Edition.
Medium world type selected in the World Options menu.
Medium worlds generate finitely (due to the lack of infinite worlds in Console Edition), with an area of 3072×3072 blocks (9 Maps). An endless sea of water preceded by an invisible barrier surrounds the edge of the world.
Medium worlds are able to generate with any of the biomes (albeit at a reduced size) and generated structures available in the current version.
Issues relating to “Medium” are maintained on the issue tracker. Report issues there.