RxJava allows building reactive applications by treating everything as a stream of messages. Observables represent message producers and observers consume messages. Observables provide asynchronous and parallel execution via operators like subscribeOn and observeOn. This makes applications resilient to failure, scalable under varying workloads, and responsive to clients. RxJava also promotes message-driven architectures, functional programming, and handling errors as regular messages to improve these characteristics. Developers must also unsubscribe to prevent leaking resources and ensure observables only run when needed.