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Knowledge / Artificial Intelligence

AI Agents

Systems that combine models with tools, memory, planning and action loops.

By Siddhant Krishna · Published 2026-10-06 · Updated 2026-10-06

01

What is an AI agent?

An agent is a system that perceives its environment and chooses actions in pursuit of objectives. In software, an AI agent often consists of a foundation model surrounded by memory, tools, state management, planning logic and execution code.

02

The agent loop

  • Observe: inspect the current environment or task state.
  • Reason: determine what information is relevant and what action should come next.
  • Act: call a tool, modify state or produce an external action.
  • Observe again: inspect the result and update the next decision.

The loop matters because many useful tasks cannot be completed in a single model call. Reliability therefore depends on both model quality and orchestration.

03

Tool use

Tools give a model capabilities it does not possess internally. Common examples include calculators, browsers, databases, code execution environments, APIs and robotic actuators.

Tool use also creates a systems-design problem: the agent must select the correct tool, form valid arguments, interpret the result and recover from failures.

04

Memory

A context window is not equivalent to durable memory. Agent systems may use short-term working context, conversation history, structured state or external retrieval systems to maintain information across longer workflows.

05

Reliability

  • Incorrect plans
  • Invalid tool arguments
  • Hallucinated state
  • Failure to recover from errors
  • Runaway execution loops
  • Security failures caused by untrusted external instructions

References

  1. Stuart Russell and Peter Norvig. Artificial Intelligence: A Modern Approach, 4th edition. Pearson.
    https://www.pearson.com/en-us/subject-catalog/p/artificial-intelligence-a-modern-approach/P200000003500/9780137505135

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