The Sims Medieval is a stand-alone game. According to the SimsWiki is uses the same engine as The Sims 3, but it's not an expansion pack for TS3. TSM does have one expansion back called The Sims Medieval: Pirates and Nobles.
Totally its own game, and very different from most Sims games. It has a very different pace and style of play, with more direction and fewer sandbox elements. I'd say it's a hybrid single player RPG and fantasy kingdom sim.
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