It is exactly what it sounds. An unknown element.
HTMLUnknownElement is an interface that means an invalid HTML element.
As per W3 cubs docs, it derives from the HTMLElement interface, but without implementing any additional properties or methods.

Image Source: w3cubs
In JavaScript, document.createElement() method creates an HTMLUnknownElement if tagName isn’t recognized.
Syntax of Document.createElement()
let element = document.createElement(tagName[, more options]);
As you can see in the syntax of createElement() above, if it can’t recognize the tagName then it will create HTMLUnknownElement.
Source: MDN
definition elements html tags HTMLUnknownElement undefined