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The first film to use the pixilation technique is Jobard ne peut pas voir les femmes travailler (Jobard can't see women working) from Emile Courtet in 1911.
Other examples include the Canadian short film Neighbours, and the music videos for "Road to Nowhere" by Talking Heads and "Sledgehammer" by Peter Gabriel.
This is not the same as pixelization where an image is blurred by displaying part or all of it at a lower resolution.
Pixilated also means affected by pixies, or bewitched (a pixie is a kind of sprite or elf), and in British usage is a synonym for being intoxicated by alcohol.