From Ever changing code
It's Cygwin/MSYS adapter.
winpty is a Windows software package providing an interface similar to a Unix pty-master for communicating with Windows console programs. The package consists of a library (libwinpty) and a tool for Cygwin and MSYS for running Windows console programs in a Cygwin/MSYS pty.
The Unix adapter allows running Windows console programs (e.g. CMD, PowerShell, IronPython, etc.) under mintty or Cygwin's sshd with properly-functioning input (e.g. arrow and function keys) and output (e.g. line buffering). The library could be also useful for writing a non-Cygwin SSH server.