Glossary of Literary Theory by Greig E. Henderson and Christopher Brown

Irony:

Recognition of the difference between real and apparent meaning. Verbal irony is a rhetorical trope wherein "x" is uttered and "not x" is meant, as when Mark Anthony says that Brutus is an honorable man. Dramatic irony occurs when characters say something and the auditors know more than they do. In the New Criticism, irony, the poet's recognition of incongruities, was thought to be the master trope in that it was essential to the production of paradox, complexity, richness, and ambiguity. (See also New Criticism.)