Function calling refers to the action of invoking a specific block of code known as a function, which is designed to perform a particular task or operation. In programming and AI, functions help break down complex problems into manageable parts. For instance, if you need to calculate the sum of a list of numbers, a function would take the list as input and return the sum as output. This modular approach simplifies debugging, enhances code clarity, and promotes reusability by encapsulating specific functionalities within callable units.