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What are Tokens and why do they matter?
Last updated: August 21, 2025
AI Models & Technologies

Tokens are units of text (often subwords) used internally by LLMs. Token budgets affect costs, speed, and how much content can be passed to a model. Optimizing content for compactness and clarity increases the chance that important chunks fit within token limits during retrieval and generation.

Related Keywords
TokensTokenizationLLM CostPrompt SizeEfficiency

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