Understanding Appium Architecture is crucial for leveraging its full potential in mobile automation testing. The architecture consists of different components such as the Appium server, drivers, client libraries, plugins, and inspector. The Appium server is a Node.js API server that handles communication between the Appium client and driver. Drivers are platform-specific frameworks used to redirect user commands to their respective platforms. Client libraries allow users to write test scripts in various programming languages. Plugins extend and modify Appium behavior during live sessions, while the inspector helps find elements for interaction. The Appium Doctor is a command line utility that checks setup requirements for individual platforms.