Physicists like to call it heat equation. I like to call it energy preserving Gaussian blur. I mean, it's more fundamental than just physics. To me, it seems a core mathematical function. https://www.cs.cmu.edu/~kmcrane/Projects/HeatMethod/
The classic demoscene fire effect is surprisingly simple and at the same time surprisingly physically accurate, or at least physically inspired: https://lodev.org/cgtutor/fire.html
I believe it's a kinda-sorta reformulation of the Gauss-Seidel method of solving systems of linear equations (which, obviously are fundamental in physics).