An advertising agency is a service businesses dealing with the creation, development and management of clients advertising. An advertising agency is able to bring an outside point of view to the campaign and present the clients strengths to the targeted market more effectively. An advertising agency sometimes plans, prepares and presents an entire marketing or branding campaign for a product or service.

Advertising dates back almost to prehistoric times with petroglyphs and cave art boasting about successful hunts, and Egyptian and Greek papyrus documents promoting commercial products or events. Mass advertising—where many people or groups are targeted through an advertising agency campaign is relatively recent in history. The use of an advertising agency to develop and manage such a campaign was extremely uncommon before the 1840s.

In the United States, the first advertising agency was that of Volney Potter, established in 1843 in the city of Philadelphia. Originally, an advertising agency was concerned only with the selling of advertisements to a newspaper, but by the beginning of the 20th century, they were involved in creating advertisement content as well as its distribution. R. F. White advertising agency, Great Britain was one of the first to create advertisements for its clients rather than just buy space.

A typical client of an advertising agency might be a corporation, business, non-profit agency or governmental unit. Just as clients come in all sizes, so do advertising agencies, from small one to two person agencies to multinational corporations. The quality of the advertising produced by the agency is not necessarily a reflection of its size. An advertising agency can provide full range services for the client, or it may specialize in a particular field, such as health advertising, or a particular media, such as newspapers.

An advertising agency usually consists of two or more separate departments. First,of course is the creative group, who actually dream up the ads are the core of the agency. Creative teams often consist of an art director and copywriter reporting to a creative director.

In addition to the creative department, there is another major advertising agency department known as creative services. These are the people who actually deal with the suppliers of the creative media. A third department within an advertising agency is the traffic department. The traffic department is responsible for increasing efficiency and profitability through managing workflow, producing cost estimates and sharing information as needed.

It remains to be seen how the changes in advertising due to the influence of the internet will affect the work done by advertising agencies. It is more than likely, however that advertising agencies will increase in creative force to meet the challenges of the new type of media advertising.