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VPC Peering plays a critical role in AWS by enabling direct connectivity between two Virtual Private Clouds (VPCs). This allows resources in one VPC to communicate with resources in another VPC as if they are part of the same network.

This connectivity is established without the need for a gateway, VPN connection, or internet gateway, making it a cost-effective solution for scenarios that require secure and private communication between VPCs. VPC Peering can be implemented across different AWS accounts and regions, allowing for flexible architectures and facilitating the sharing of resources and services between applications in different environments.

Understanding this role is essential for designing network architectures that require inter-VPC communication, resource sharing, and collaboration among different teams or departments within an organization. This capability enhances the overall utility and reach of cloud applications, making VPC Peering a fundamental aspect of network management in AWS.