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Escort agencies are companies that book and dispatch escorts to a customer's house, hotel room, or requested location.

From a legal perspective, escort agencies claim that they are dispatching these individuals to provide a social or conversational service, since prostitution laws often forbid taking payment for sex or communicating for the purpose of arranging a contract for sexual services. Advertisements for escort agencies often carefully skirt the legal line, and avoid specifically offering prostitution or sexual services. This fact in turn is well-known to police and the political powers, who, where prostitution is illegal, usually prefer to act against more visible and problematic street prostitution. This has been criticized as hypocrisy, especially where governments license and tax the escort agencies. There are however, agencies that do go by these laws and do not commit prostitution.

Some countries have used a two-pronged attempt of criminalizing street prostitution but permitting or licensing prostitution in brothels or via escort agencies.

Escort agencies often recruit individuals to work as escorts by placing employment advertisements in a magazine or newspaper. Escort agencies typically maintain a list of escorts of different ages and appearances to cater to the varying interests of clients. Some agencies may specifically deal in a certain type of escort. There are male-for-male, female-for-male, and female-for-female escort agencies, as well as a few male-for-female agencies. Agencies commonly specialize in only one sex. Transsexuals are available from some escort agencies.

It is very common to find that escorts enter the business through referrals from friends that have been in the business. The effectiveness of ads in weeklies or specialized sites has been questioned by some operators as there are so many that they are diluted. Typically, an escort will interview with an agency.

Once an agency decides to hire a model, she or he will provide photographs or pose for a photographer. These pictures will be posted on their site or circulated among clients to drum up business.

Escort agencies typically advertise in regional publications and telephone listings such as the Yellow Pages. Some larger escort agencies maintain websites with photo galleries of their escorts. Clients contact agencies by telephone and offer a description of what kind of escorts are sought. The agency will then suggest an escort who might fit that client's need.

The agency collects the client's contact information and calls the escort. Usually, to protect the identity of the escort and ensure effective communication with the client, the agency arranges the appointment. Sometimes it may be up to the escort to contact the client directly to make arrangements for location and time of an appointment. Generally the escort is also expected to call the agency upon arrival at the location and upon leaving, which improves the safety of the escort.

The arm's length relationship between the escort and the escort agency is designed to protect the escort agency (to some degree) from prosecution for breaking laws against prostitution. If the employee is solely responsible for arranging any illegal prostitution-oriented activities, the agency can maintain plausible deniability should an arrest be made.

Escort services aim to provide an experience that allows the operators to claim that whatever happens between the escort and the client is consensual. Operators tend to avoid discussing specifics to avoid complications.