SQLite is a serverless database engine, meaning it does not require a separate server process to operate. Instead, the database engine runs within the same process as the application, reading and writing directly to the database files on disk. This architecture has advantages, such as zero-configuration and ease of use, but also disadvantages, such as reduced protection from bugs in the client application. The article also discusses the distinction between 'classic serverless' and 'neo-serverless' databases.