Active Galactic Nuclei (AGN) are one of the key players in the Universe. Their energy output can strongly affect the growth of their host galaxy and can promote or suppress star formation on galactic scales. Most of the processes that determine the power of an AGN as well as the form in which that power is released take place in the immediate surroundings of its supermassive black hole, a region that is still not entirely understood. A comprehension of these inner regions is, however, crucial to any ultimate understanding of the AGN's vast influence. This dissertation explores these close-in environments of the black hole using two approaches: X-ray spectroscopy and variability studies.

We begin by summarizing our current understanding of why AGN play such a significant role in galaxy formation. This is followed by a discussion of why X-ray spectroscopy is one of the best means to investigate them. We point out that, in particular, the X-ray reflection spectrum is interesting as it can directly probe parameters such as the black hole spin or the inclination of the accretion disk. Since the reflection spectrum is a broad band component, that usually only contributes a fraction of the total observed X-ray flux, the entire X-ray spectrum requires careful modeling.

To perform such modeling and gain access to the parameters of the reflection spectrum, we first select a target in which the spectral decomposition is simplified by the absence of absorption - the Seyfert 1 galaxy Fairall 9. We apply a multi-epoch fitting method that uses more than one spectrum at a time to get the best possible results on the parameters of the reflection spectrum that are invariant on human timescales. This technique enables us to tightly constrain the reflection parameters and leads us to conclude that Fairall 9 most likely possesses a composite soft X-ray excess, consisting of blurred reflection and a separate component such as Comptonization.

The reflection spectrum also provides a way to enhance our knowledge of jet formation. We present a multi-wavelength study of the broad line radio galaxy 3C120 centered around a study of the reflection spectrum from two Suzaku and one XMM observation. Our results confirm that jet formation is linked to changes in (and possibly the destruction of) the inner accretion disk, and the high measured spin suggests that the rotational energy could very well be the energy source required to launch the jet.

Finally, we present results from variability studies, which present another window into the processes taking place close to the black hole. A 10 year RXTE monitoring of Fairall 9 allows us to discover very rapid flux dips in the X-ray band which only last 5-15 days. While we are unable to determine the exact nature of the dips, we discuss a range of possible models, including the idea that the accretion disk in this radio-quiet AGN may be undergoing sporadic disruptions (via some yet-to-be-determined global instability) in much the same manner as is inferred to occur in 3C120 and other broad-line galaxies. Lastly we turn to the UV variability of Fairall~9 and its connection to the X-ray variability. From 2.5 months of Swift monitoring, we find that Fairall~9 shows significant variability on 4 day timescales, and the analysis of XMM-OM data shows that variability is present even on the time scales of hours. Folding in the X-ray variability, we determined that this fast UV variability can be explained as reprocessing of X-rays. We conclude by explaining how these studies fit into the field of AGN science as a whole and how they can be followed up with future observations.