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With the development of artificial intelligence (AI), smart systems have moved from simple automation to context-aware environments. Traditional smart environments merely rely on pre-programmed reactions to specific triggers, whereas new-age smart environments adopt integrative AI architectures to fly on the copy and react on-the-fly. Nevertheless, complexities of the process including data collection, processing and context interpretation have fuelled research in this field but achieving real-time context awareness is still a challenging issue. This study aims to explore the potential of integrative AI for the development of context-aware smart systems with focus on state of-the-art architectural patterns which foster adaptive intelligent and human-centered interaction. The key objectives of the investigation are to identify limitations of the existing automation-based solution, propose innovative AI based integrated architecture for context awareness and evaluate its adequacy using case studies. We also design an AI-incorporated architecture for object click-based smart healthcare monitoring system, which integrates collecting real-time health data and making the adaptive decision to improve patient care, way as architecture for AI in cloud-based healthcare monitoring system. Although AI-powered smart systems have so much potential, the existing frameworks often do not effectively understand dynamic user situations, which leads to unsatisfactory user happiness and adaptability. Effective usage of context data can be provided within structures that can be developed in a scalable manner and can tolerate real-time reactivity is the main issue. To address this, we employ a hybrid approach that combines theoretical research and real-world implementation - a context-aware system prototype developed using integrative AI methods. We provide initial evidence that the proposed design exceeds existing automation-oriented systems on the intelligent contextual awareness and dynamic decision-making levels, highlighting the potential to enhance smart environments with context-aware AI.