Generally, open source refers to a computer program in which the source code is available to the general public for use or modification from its original design.
Unreal Engine is technically open source, because it’s source code is made available to the general public. But it is licensed under a restrictive EULA instead of any of the normal licenses you’d expect for an open source project (MIT, Apache, GPL3, etc).
This is definitely pedantic, but “open source” is a colloquial term, not a technical one. Most people mean FOSS when they say open source, but the terms aren’t exactly equivalent. The license that governs the code is really the only part that actually matters.