When building applications with APIs, selecting the appropriate architecture, such as RESTful API or gRPC, is crucial and depends on specific use cases and requirements. RESTful APIs, based on Roy Fielding’s architectural style, are widely adopted for their simplicity, flexibility, and compatibility with web technologies, making them ideal for broad client support and public-facing interfaces. They use HTTP methods like GET and POST, offering a human-readable format and ease of implementation. However, REST can have limitations in performance and doesn't natively support bi-directional streaming, which is essential for real-time applications. On the other hand, gRPC, developed by Google, excels in microservices environments, providing high performance, bi-directional streaming, strong typing, and automatic code generation through Protocol Buffers. Despite its advantages in efficiency and lower latency, gRPC can be complex to set up and lacks browser support. Many organizations use a hybrid approach, utilizing gRPC for internal microservices communication while exposing REST APIs for external clients. The choice between REST and gRPC should be guided by the application's performance needs and operational ecosystem.