# Online-Optimized RAG for Tool Use and Function Calling

arXiv: https://arxiv.org/abs/2509.20415 · HTML: https://mlsanity.com/paper/2509.20415/

## Key facts

- Cited by 2 papers in the map (data through 14 Oct 2026).
- Placed in RAG pipeline design and evaluation, one of 15 directions in Retrieval-augmented generation.
- Builds on 24 of its 44 references that are in the map.
- First posted on arXiv 24 Sep 2025.

## Placed in

- Retrieval-augmented generation / [RAG pipeline design and evaluation](https://mlsanity.com/rag/rag-pipeline-design-and-evaluation/)
- LLM agents and tool use / [Tool learning and function calling](https://mlsanity.com/agents/tool-learning-and-function-calling/)

## Builds on (most cited first, 24 of 24)

- [Retrieval-Augmented Generation for Knowledge-Intensive NLP Tasks](https://mlsanity.com/paper/2005.11401/) (2020)
- [Toolformer: Language Models Can Teach Themselves to Use Tools](https://mlsanity.com/paper/2302.04761/) (2023)
- [ToolLLM: Facilitating Large Language Models to Master 16000+ Real-world APIs](https://mlsanity.com/paper/2307.16789/) (2023)
- [Self-RAG: Learning to Retrieve, Generate, and Critique through Self-Reflection](https://mlsanity.com/paper/2310.11511/) (2023)
- [Gorilla: Large Language Model Connected with Massive APIs](https://mlsanity.com/paper/2305.15334/) (2023)
- [BEIR: A Heterogenous Benchmark for Zero-shot Evaluation of Information Retrieval Models](https://mlsanity.com/paper/2104.08663/) (2021)
- [HuggingGPT: Solving AI Tasks with ChatGPT and its Friends in Hugging Face](https://mlsanity.com/paper/2303.17580/) (2023)
- [Introduction to Online Convex Optimization](https://mlsanity.com/paper/1909.05207/) (2019)
- [API-Bank: A Comprehensive Benchmark for Tool-Augmented LLMs](https://mlsanity.com/paper/2304.08244/) (2023)
- [Adaptive-RAG: Learning to Adapt Retrieval-Augmented Large Language Models through Question Complexity](https://mlsanity.com/paper/2403.14403/) (2024)
- [RAFT: Adapting Language Model to Domain Specific RAG](https://mlsanity.com/paper/2403.10131/) (2024)
- [ToolkenGPT: Augmenting Frozen Language Models with Massive Tools via Tool Embeddings](https://mlsanity.com/paper/2305.11554/) (2023)
- [Kernel Language Entropy: Fine-grained Uncertainty Quantification for LLMs from Semantic Similarities](https://mlsanity.com/paper/2405.20003/) (2024)
- [EASYTOOL: Enhancing LLM-based Agents with Concise Tool Instruction](https://mlsanity.com/paper/2401.06201/) (2024)
- [Quantifying Uncertainty in Answers from any Language Model and Enhancing their Trustworthiness](https://mlsanity.com/paper/2308.16175/) (2023)
- [Planning, Creation, Usage: Benchmarking LLMs for Comprehensive Tool Utilization in Real-World Complex Scenarios](https://mlsanity.com/paper/2401.17167/) (2024)
- [Uncertainty Estimation and Quantification for LLMs: A Simple Supervised Approach](https://mlsanity.com/paper/2404.15993/) (2024)
- [ToolGen: Unified Tool Retrieval and Calling via Generation](https://mlsanity.com/paper/2410.03439/) (2024)
- [MBA-RAG: a Bandit Approach for Adaptive Retrieval-Augmented Generation through Question Complexity](https://mlsanity.com/paper/2412.01572/) (2024)
- [Toolshed: Scale Tool-Equipped Agents with Advanced RAG-Tool Fusion and Tool Knowledge Bases](https://mlsanity.com/paper/2410.14594/) (2024)
- [NUDGE: Lightweight Non-Parametric Fine-Tuning of Embeddings for Retrieval](https://mlsanity.com/paper/2409.02343/) (2024)
- [Query Drift Compensation: Enabling Compatibility in Continual Learning of Retrieval Embedding Models](https://mlsanity.com/paper/2506.00037/) (2025)
- [FLAIR: Feedback Learning for Adaptive Information Retrieval](https://mlsanity.com/paper/2508.13390/) (2025)
- [ReFIT: Relevance Feedback from a Reranker during Inference](https://mlsanity.com/paper/2305.11744/) (2023)

## Built on by (most cited first, 2 of 2)

- [PhGPO: Pheromone-Guided Policy Optimization for Long-Horizon Tool Planning](https://mlsanity.com/paper/2602.13691/) (2026)
- [Multi-Field Tool Retrieval](https://mlsanity.com/paper/2602.05366/) (2026)

## Abstract (arXiv)

In many applications, retrieval-augmented generation (RAG) drives tool use and function calling by embedding the (user) queries and matching them to pre-specified tool/function descriptions. In this paper, we address an embedding misalignment issue that often arises in practical applications due to imperfect embedding models or noisy descriptions; such misalignment may lead to incorrect retrieval and task failure. We introduce Online-Optimized RAG, a deployment-time framework that continually adapts retrieval embeddings from live interactions using minimal feedback (e.g., task success). Online-Optimized RAG applies lightweight online gradient updates with negligible per-query latency and requires no changes to the underlying LLM. The method is plug-and-play: it supports both single- and multi-hop tool use, dynamic tool inventories, and K-retrieval with re-ranking. We provide a problem-dependent theoretical analysis that quantifies how the method's performance depends on the initialization quality of the embeddings and other related quantities. Across diverse tool-use and document-retrieval scenarios, our Online-Optimized RAG consistently improves tool selection accuracy and end-task success, thus providing a simple, practical path to robust, self-improving RAG systems.