If you've worked with ChatGPT, Claude, Gemini, or any modern Large Language Model (LLM), you've probably heard the term token . Tokens are one of the most fundamental concepts in Generative AI, yet they are often misunderstood. Understanding tokens can help you write better prompts, optimize costs, improve performance, and design more effective AI applications. Let's break it down. What Is a Token? A token is the basic unit of text that an LLM processes. Contrary to popular belief, AI models don