Serverless architecture allows organizations to focus on building business logic instead of managing infrastructure. In the serverless model, cloud providers like AWS, Google Cloud, and Microsoft Azure handle servers, security, and networking. The approach, which gained popularity around 2016, is typically event-driven and stateless, meaning functions execute only when triggered and resources are shared efficiently among users. This results in significant cost savings, as organizations pay only for actual usage rather than reserved capacity. Serverless solutions also eliminate the need for server maintenance expertise within organizations. However, challenges exist, including vendor lock-in, cold start latency issues, execution time limits, and the potential complexity of managing multiple interconnected functions. Despite these limitations, serverless architecture is well-suited for workloads requiring high scalability and parallel processing of smaller tasks.