Shawn Hunter: It does if you've seen as many horror movies as I have. This is classic. The locked door, the scary janitor, the bloody warning and... our soon to be first victim.
[everyone looks at Kenny]
Kenny: Me? Why me?
Cory Matthews: Well Kenny, it's certainly not going to be any of us!
A Genre Savvy character doesn't necessarily know they're in a story, but they do know of stories like their own and what worked in them and what didn't. They may attempt to apply the lessons they've learned from movies, books, or other fiction to their own situation, or they may restrict themselves to snarky asides and observations. The exact opposite of Genre Blindness.
For cases when a Genre Savvy character attempts to apply the tropes of a different genre of story to their own situation, see Wrong Genre Savvy. When a person becomes too Genre Savvy for their own good and off themselves, see Death by Genre Savviness. If a character uses his Genre Savviness just to make humorous observations, he's a Meta Guy. When characters are not consciously Genre Savvy but regularly act within the limitations of the genre they're in anyway, they are Functional Genre Savvy. Compare with Medium Awareness where the character knows that they're in a story and what medium they are in.
Not to be confused with a character who has observed what works and what doesn't in their own world, which is Taught by Experience.
For specific tips on surviving the world of fiction, see The Universal Genre Savvy Guide.