What is Tool Calling?
Tool calling is the mechanism by which a large language model generates structured requests to invoke external tools, APIs, or functions — enabling the model to take actions and retrieve information beyond its training data.
WHY IT MATTERS
Tool calling and function calling are largely synonymous — both refer to the LLM's ability to output structured JSON that triggers external operations. 'Tool calling' has become the more common term as the ecosystem has matured.
The flow is standardised: you provide the LLM with tool definitions (name, description, parameter schema). The model decides when to call a tool and generates the arguments. Your application executes the call and returns results to the model. This cycle can repeat multiple times in a single turn.
Every tool call is a potential side effect — writing a file, sending an email, executing code, modifying infrastructure. Without policy enforcement, the only thing standing between an LLM's decision and real-world consequences is the application code that executes the call.
HOW POLICYLAYER USES THIS
Intercept enforces YAML-defined policies on every tool call flowing through the MCP proxy. When an agent's LLM outputs a tool call, Intercept evaluates it against the policy — checking the tool name, argument values, and rate limits — before forwarding it to the server. Denied calls never reach the server. No changes to the agent or server code are needed.