To dramatize something is to put it in dramatic form (like a TV show or movie) or make it seem more dramatic, using exaggeration.
Anytime you see a movie or TV show about real events, the actors are dramatizing what really happened. If you slipped on the sidewalk and hurt your knee a little but later made it sound like the most tragic event in the history of humanity, you're guilty of dramatizing what happened. To dramatize in that way is to exaggerate and embellish — it's something that we all do occasionally.
