An entity is a specific piece of information the AI extracts from user input — a person's name, a date, an account number, a product code. Entities turn vague requests into actionable structured data.
A user saying "I need to check my order from last Tuesday" contains two entities: the intent is order lookup, and "last Tuesday" is the date entity the system needs to run the query. Without entity extraction, the AI understands the general request but cannot actually look anything up — because it does not have the specific values it needs.
