Itihaasa (इतिहास) is commonly translated as "history".
Here is a competing meaning, and seems to be more in tune with the actual exemplars of Itihaasa that we have (e.g., the Mahabharata).
इतिवृत्त (Itivritta) is the word that means chronicle, annals, record of historical events; and in dramaturgy, it means the plot of a play.
PS:
PS: footnote 20 on this page on the Natya Shastra has this:
Kauṭilya in his definition of itihāsa enumerates purāṇa and itivṛtta as belonging to its contents. An itivṛtta, according to Winternitz, can only mean an “historical event” and purāṇa
probably means “mythological and legendary lore.” Vol. I. p. 518.
Pargiter has, however, extracted solid historical facts from some of the
extant Purāṇas (See his Ancient Indian Historical Traditions, London,
1922). According to the Indian tradition itihāsa is said to be
an account of events that occured in the past, carrying in it
instructions about duty, wealth, enjoyment of pleasure, and salvation.
The same tradition assigns the position of itihāsa to the Mahābhārata the great Indian epic. It is possibly this itihāsa that has been connected with the Nāṭyaveda by the author of the śāstra.
Hence it appears that Oldenberg’s theory about the original connexion
between epic and dramatic poetry, is worthy of serious consideration. Nāṭyākhyaṃ pañcamaṃ vedaṃ setihāsaṃ karomy aham (15) seems to be very significant. Ag. (I. p. 13) explains setihāsam as itihāsopadeśakarūpaṃ saprabbedam. See Winternitz, Vol. I. pp. 100 ff, 312 n,
PS: duty, wealth, enjoyment of pleasure, and salvation = dharma, artha, kama, and moksha