The air taxi market is an application of Advanced Air Mobility (AAM) - air transportation systems that utilize advanced technologies such as vertical takeoffs, autonomous capabilities, or fully-electric systems - for short to mid range on-demand flights. Many AAM vehicles are designed for Short Takeoff and Landing (STOL) or Vertical Takeoff and Landings (VTOL); electric VTOL aircraft are also prominent, known as eVTOLs.

Urban Air Mobility (UAM) is the use of small, highly automated aircraft to carry passengers or cargo at lower altitudes in urban and suburban areas which have been developed in response to traffic congestion. It usually refers to existing and emerging technologies such as traditional helicopters, vertical-takeoff-and-landing aircraft (VTOL), electrically propelled vertical-takeoff-and-landing aircraft (eVTOL), and unmanned aerial vehicles (UAVs). These aircraft are characterized by the use of multiple electric-powered rotors or fans for lift and propulsion, along with fly-by-wire systems to control them. Inventors have explored urban air mobility concepts since the early days of powered flight. However, advances in materials, computerized flight controls, batteries and electric motors improved innovation and designs beginning in the late 2010s. Most UAM proponents envision that the aircraft will be owned and operated by professional operators, as with taxis, rather than by private individuals.