The famous inventor known for his work with alternating current is Nikola Tesla. Tesla's innovations in the late 19th century laid the groundwork for modern electrical systems, including the development of the AC motor and the transmission of electrical energy over long distances. His rivalry with Thomas Edison, known as the War of Currents, highlighted the advantages of alternating current over direct current. Tesla's visionary ideas and inventions not only advanced technology but also had a lasting impact on the electricity we use today.