Not a single definition below has got it right yet.
Cuddling is NOT hugging.
Hugging is what you do when you're standing up. Cuddling is what you do when you're lying down.
To completely spell it out, since the below people apparently have no idea what cuddling is: you and another (usually) person lie down next to each other in such a way that the two bodies are touching AND the arms of at least one person are wrapped around the other person.
"I love cuddling with you."
"But we're not cuddling; this is a hug since we are standing up."
"Oh. Wanna lie down and cuddle then?"
"Yes, because that would make sense."
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