Arbitration is a method of resolving disputes outside of the traditional court system. In this process, an impartial third party, known as an arbitrator, is appointed to review the evidence and make a binding decision. This approach is often favored for its efficiency and confidentiality compared to litigation. Parties involved in arbitration typically agree to abide by the arbitrator's decision, which can be enforced in courts. This makes arbitration a popular choice for resolving commercial disputes, labor conflicts, and international disagreements, providing a streamlined alternative to lengthy court proceedings.