How does hallucination occur in ChatGPT and how can it be reduced architecturally?

Hallucination occurs when the model generates plausible but incorrect information due to lack of grounding.

Hallucination happens because ChatGPT is trained to predict likely text, not verify factual correctness. When the training data is uncertain or conflicting, the model generates statistically plausible but incorrect outputs.

Architectural mitigation includes retrieval-augmented generation (RAG), tool use (search APIs), constrained decoding, and reinforcement learning alignment. Grounding the model in external knowledge significantly reduces hallucination risk.