Pacing is one of the player's perceptions on the level design of a game. Much like how a book has plot buildup, climaxes and resting places, pacing can be drawn out in a similar way. A well paced game would catch the player's attention and keep them involved with the experience all the way to the satisfying climax and ending.
Elements of Pacing
The structures and mechanics that come together to create pacing are numerous however many of them fall into the following categories.
The threat level is the actual danger the player experiences in a game. Pacing can be increased by increasing the threat level by introducing enemies or encroaching danger. A high threat level can be an overwhelming army of enemies that can take out the player with one wrong move.
Movement Impetus is the desire of the player to continue on through the levels of the game. Some ways to improve the player's movement impetus it to create objectives & rewards ahead or to introduce a threat from behind.
Tension is the perceived danger the player experiences. The difference between this and threat level is that the threat level is often rooted in game mechanics whereas tension uses atmosphere design. A high buildup of tension would be a single unknown creature hidden in the shadows that keeps a player questioning their every move even though game mechanic-wise nothing would happen to them until they reach the scripted climax. Survival Horror games often use tension the most for their pacing.
Tempo is the intensity of action at the given moment of the game. High Tempo gameplay often requires split-second decisions and reflexes, something that many First Person Shooters have. On the other end, Low Tempo gameplay usually involves puzzles or things that require contemplation.
The Arc, Scene, and Action Pacing
A well designed game would have good pacing not only in the overall game (the Arc), but would use the same pacing in the Scene and Action portions of the game. The Scene is the levels and the Action is the actual game mechanics the player uses.
Examples of Good Pacing
Portal's most well known example of stimulating Movement Impetus is the famous "cake" reward. It also created a good buildup of tension through the use of the environment itself such as the scribbled messages in some of the "hidden" rooms the player encountered. The escalation of threat level with the introduction of water, energy balls, turrets, a single rocket launcher and neurotoxin kept the player on their toes when solving the portal puzzles.
In Other Media
Star Wars IV: A New Hope is the cited example in the Extra Credits episode showing an excellent example in pacing.