Lit. is a short written form of literature or literary. You see it in notes, course names, and book talk: Eng. lit. for English literature, lit. crit. for literary criticism, a lit. magazine for a literary magazine. The full stop is a hint that letters were cut. When you speak, you usually say the full word — “literature,” not “lit” — unless you are being very casual (“I’m doing lit this term”). Though actually, the same letters without the stop are other words entirely: lit as the past of light (“she lit the candle”), and slang lit for “exciting” or drunk. Those are not this entry. This one is only the school-and-books shortening.