The avian hippocampus, akin to its mammalian counterpart, plays a critical role in cognitive and physiological processes despite notable structural differences. Initially thought to be less developed, recent studies over the past two decades have revealed it as a complex brain region essential for diverse functions in both laboratory and free-living birds. This review synthesizes current knowledge on the avian hippocampus' organization, functionality, and neurophysiological significance. We first examine its anatomical structure and neuronal connectivity, comparing it with the mammalian hippocampus. We then highlight how its volume, neuronal density, and neurogenesis support spatial memory and navigation, influencing behaviors such as migration, food storing, brood parasitism, and homing. Beyond spatial functions, the avian hippocampus mediates emotion and stress physiology through interactions with the endocrine system, particularly via glucocorticoid receptors. It also influences spatial memory through sex hormones, especially estradiol, with local estrogen production through aromatase activity enhancing memory and plasticity. Therefore, the avian hippocampus serves as a central neural hub, integrating sensory information with internal states to facilitate essential behaviors and responses to external environmental stimuli. This review underscores the progress made in understanding this brain structure's roles, highlighting conserved neurophysiological functions across vertebrate taxa.