These are lab-made restorations which are used when the lost tooth material is too big to be replaced by a simple dental filling. The entire process is similar to the making of a crown. After the teeth is prepared, it is bonded to the teeth.
Dental Inlays are made out of different materials including gold, porcelain & composite resins. Whilst composite & porcelain inlays and outlays are quite strong and preferred due to their appearance, it is not the same case with gold outlays and inlays.
Your dentist would be the right person to advise you on what type of inlay/outlay would work for you. Aesthetically, Inlays and Outlays are preferred over dental fillings and the cost is higher than that of a traditional dental filling and similar to that of a dental crown.