An Applicative Functor is a type of functor in functional programming that allows for applying functions wrapped in a context to values also wrapped in a context. This means you can work with functions that take multiple arguments, where both the function and the arguments are contained within a structure, such as a list or an optional value. In contrast to regular functors, which can only apply a function to a single value, applicative functors enable a more powerful way to combine computations. They provide two key operations: pure, which lifts a value into the context, and apply, which applies a wrapped function to a wrapped value, facilitating more complex operations while maintaining the context.