Help the magnitude is not working it's on line 25, please help?

The issue here is that it won't become visible because you are not updating the distance check. So what I would suggest doing is:

Also the way you are accessing the ScreenGui is not valid. so instead do this:

local player = game.Players.LocalPlayer

local character = game.Players.LocalPlayer.Character

local humanoidRootPart = character:WaitForChild("HumanoidRootPart")

-- Find NPC

local NPC = game.Workspace.NPC

-- Main Variables

local UIS = game:GetService("UserInputService")
local RS = game:GetService("RunService")

local distance = 15

-- Gui

local GUI = player.PlayerGui:WaitForChild("NPC_Chat_System")--getting the gui from the **PlayerGui** *

local guiFrame = GUI.NPC_Chat_Frame

-- Main Code
RS.RenderStepped:connect(function() -- constantly updating the distance check
	if (humanoidRootPart.Position - NPC.HumanoidRootPart.Position).magnitude < distance then
		guiFrame.Visible = true
	else
		guiFrame.Visible = false
	end
end)