---
term: "AI system"
category: "Agents and autonomy"
url: https://agenticopenfinance.com/glossary/ai-system
source: AgenticOpenFinance glossary
---

# AI system

> A machine-based system that infers from its inputs how to generate outputs such as predictions, content, recommendations or decisions.

Under the EU AI Act, an AI system is a machine-based system designed to operate with varying levels of autonomy, which may adapt after deployment and which infers from the input it receives how to generate outputs such as predictions, content, recommendations or decisions that can influence physical or virtual environments. The OECD uses a closely aligned definition. The capacity to infer is what separates an AI system from fixed rule-based software, and it is what brings the Act's obligations into play.

Related terms: [AI agent](https://agenticopenfinance.com/glossary/ai-agent.md), [Large language model](https://agenticopenfinance.com/glossary/large-language-model.md), [Level of autonomy](https://agenticopenfinance.com/glossary/agent-autonomy.md), [High-risk AI system](https://agenticopenfinance.com/glossary/high-risk-ai-system.md)