What Is a Large Language Model (LLM)?

This deep-learning model understands and generates text in a human way

Large Language Models (LLMs): Overview

A large language model (LLM) is a deep learning algorithm that’s equipped to summarize, translate, predict, and generate text to convey ideas and concepts. Large language models rely on substantively large datasets to perform those functions. These datasets can include 100 million or more parameters, each of which represents a variable that the language model uses to infer new content.

Large language models utilize transfer learning, which allows them to take knowledge acquired from completing one task and apply it to a different but related task. These models are designed to solve commonly encountered language problems, which can include answering questions, classifying text, summarizing written documents, and generating text.

In terms of their application, large language models can be adapted for use across a wide range of industries and fields. They’re most closely associated with generative artificial intelligence (generative AI).

Key Takeaways

  • Large language models utilize deep learning algorithms to recognize, interpret, and generate human-sounding language.
  • A large language model utilizes massive datasets, often featuring 100 million or more parameters, in order to solve common language problems.
  • Developed by OpenAI, ChatGPT is one of the most recognizable large language models.
  • Some of the ways in which large language models are used include content creation, translation, and virtual chat or assistant applications.

How Large Language Models Work

Large language models work by analyzing vast amounts of data and learning to recognize patterns within that data as they relate to language. The type of data that can be “fed” to a large language model can include books, pages pulled from websites, newspaper articles, and other written documents that are human language-based.

In terms of the mechanics of large language models, there are some key steps that must occur for them to work:

  • A large language model needs to be trained using a large dataset, which can include structured or unstructured data.
  • Once initial pre-training is complete, the LLM can be fine-tuned, which may involve labeling data points to encourage more precise recognition of different concepts and meanings.
  • In the next phase, deep learning occurs as the large language model begins to make connections between words and concepts.
  • Once the model is trained, it should then be equipped to produce language-based responses using specific prompts.

A large language model operates as a type of transformer model. Transformer models study relationships in sequential datasets to learn the meaning and context of the individual data points. In the case of a large language model, the data points are words. Transformer models are often referred to as foundational models because of the vast potential they have to be adapted to different tasks and applications that utilize AI.


ChatGPT, developed and trained by OpenAI, is one of the most notable examples of a large language model.

Types of Large Language Models

There are several types of large language models in use. The differences between them lie largely in how they’re trained and how they’re used. Here’s how they compare at a glance.

  • Zero-shot model: Zero-shot models are generalized large language learning models that are trained using a wide body of data to generate answers to questions. These models generally don’t require any additional training for use.
  • Fine-tuned or domain-specific models: When a zero-shot model is subject to additional training, the end result can be a fine-tuned model. Fine-tuned models are typically smaller than their zero-shot counterparts, as they’re designed to handle more specialized problems. OpenAI’s Codex is an example of a fine-tuned model that’s more refined than its zero-shot model predecessor, GPT-3.
  • Edge or on-device models: Edge models can operate like fine-tuned models, but they typically have an even smaller scope. This type of model is often designed to produce immediate feedback based on user input. Google Translate is an example of an edge model at work.

In addition to GPT-3 and OpenAI’s Codex, other examples of large language models include GPT-4, LLaMA (developed by Meta), and BERT, which is short for Bidirectional Encoder Representations from Transformers. BERT is considered to be a language representation model, as it uses deep learning that is suited for natural language processing (NLP). GPT-4, meanwhile, can be classified as a multimodal model, since it’s equipped to recognize and generate both text and images.

What Are Large Language Models Used for?

Large language models have a broad range of capabilities, and there are numerous ways in which they can be used. There are five specific categories of activities in which LLMs may be employed:

  • New content generation
  • Summarization of existing content
  • Translation across languages, or from text to code
  • Classification of texts
  • Chatbot applications

AI and large language models are increasingly being used in various industries, ranging from finance to healthcare to marketing. Some specific examples of uses for large language models include:

  • Training LLMs to analyze medical records or research studies, in order to identify patterns or make predictions about outcomes relating to specific health treatments or conditions.
  • Utilizing large language models to power chatbot applications to provide customer service and reduce the need for human employees.
  • Using LLMs to write email newsletters, video scripts, blog articles, and social media posts, in order to streamline the content creation process.
  • Training large language models to write software programs or create code for mobile applications.
  • Incorporating LLMs into online search engines to provide the most accurate results to consumers who are searching for a specific topic, keyword, or query.

Those are just some of the ways that large language models can be and are being used. While LLMs are met with skepticism in certain circles, they’re being embraced in others.


Google has announced plans to integrate its large language model, Bard, into its productivity applications, including Google Sheets and Google Slides.

Advantages and Limitations of Large Language Models

While technology can offer advantages, it can also have flaws—and large language models are no exception. As LLMs continue to evolve, new obstacles may be encountered while other wrinkles are smoothed out.

Here are some of the main advantages of large language models:

  • Increased efficiency for users: Using large language models to generate content can save time for individuals and businesses that rely on text-based content. Instead of spending hours writing a single marketing email or blog post, you can use a tool like ChatGPT to create it in minutes.
  • Wide variety of applications: Large language models are not limited to use in any one industry or field. Their adaptability and accessibility can make them suited to a number of uses across different fields.
  • Ever-evolving technology: AI technology is changing all the time, and large language models are constantly being refined to increase their accuracy. Each new innovation represents a potential new opportunity to put LLMs to use and learn just how much they’re actually capable of doing.

The main limitation of large language models is that while useful, they’re not perfect. The quality of the content that an LLM generates depends largely on how well it’s trained and the information that it’s using to learn. If a large language model has key knowledge gaps in a specific area, then any answers it provides to prompts may include errors or lack critical information.

Aside from that, concerns have also been raised in legal and academic circles about the ethics of using large language models to generate content.


In 2023, comedian and author Sarah Silverman sued the creators of ChatGPT based on claims that their large language model committed copyright infringement by “digesting” a digital version of her 2010 book.

What Are the Challenges of Large Language Models (LLMs)?

Large language models primarily face challenges related to data risks, including the quality of the data that they use to learn. Biases are another potential challenge, as they can be present within the datasets that LLMs use to learn. When the dataset that’s used for training is biased, that can then result in a large language model generating equally biased, inaccurate, or unfair responses.

What Are Examples of Large Language Models?

There are many different types of large language models in operation and more in development. Some of the most well-known examples of large language models include GPT-3 and GPT-4, both of which were developed by OpenAI, Meta’s LLaMA, and Google’s upcoming PaLM 2.

What Is the Difference Between Natural Language Processing (NLP) and Large Language Models?

NLP is short for natural language processing, which is a specific area of AI that’s concerned with understanding human language. As an example of how NLP is used, it’s one of the factors that search engines can consider when deciding how to rank blog posts, articles, and other text content in search results.

Large language models are deep learning models that can be used alongside NLP to interpret, analyze, and generate text content.

The Bottom Line

Large language models (LLMs) are something the average person may not give much thought to, but that could change as they become more mainstream. For example, if you have a bank account, use a financial advisor to manage your money, or shop online, odds are you already have some experience with LLMs, though you may not realize it.

Learning more about what large language models are designed to do can make it easier to understand this new technology and how it may impact day-to-day life now and in the years to come.

Article Sources
Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
  1. IBM. “What Is Generative AI, What Are Foundational Models, and Why Do They Matter?

  2. New York University, Shanghai Library. “Machines and Society: What Large Language Models Are.”

  3. Princeton University Media Central. “How Does ChatGPT Work? An Overview of Large Language Models (Part 2 of 3).”

  4. Stanford University, Freeman Spogli Institute for International Studies. “On the Opportunities and Risks of Foundational Models.”

  5. TechCrunch. “The Emerging Types of Language Models and Why They Matter.”

  6. Google, The Keyword Blog. “Understanding Searches Better than Ever Before.”

  7. OpenAI. “GPT-4.”

  8. OpenAI. “Transforming Work and Creativity with AI.”

  9. Stanford University, Human-Centered Artificial Intelligence. “How Large Language Models Will Transform Science, Society, and AI.”

  10. The Associated Press. “Sarah Silverman and Novelists Sue ChatGPT-Maker OpenAI for Ingesting Their Books.”

  11. The Brookings Institution. “Detecting and Mitigating Bias in Natural Language Processing.”

Open a New Bank Account
The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.