Il mio amico che cammina nel giardino è alto.

In Italian, a possessive adjective like mio usually goes together with a definite article:

• il mio amico = my friend
• la mia casa = my house
• i miei libri = my books

So il mio amico is the normal pattern.

A common exception is with many singular family members:

• mio padre
• mia madre
• mio fratello

But amico is not a family-member noun, so the article il is normally used.

Amico is the masculine singular form, so it refers to a male friend.

• amico = male friend
• amica = female friend

Because the sentence says il mio amico, everything agrees with a masculine singular noun.

Che is a relative pronoun here. It means who, that, or which, depending on the context.

In this sentence, che cammina nel giardino describes amico:

• il mio amico = my friend
• che cammina nel giardino = who is walking in the garden

So che links the noun amico to the description that follows it.

Camminare is the infinitive form: to walk.

Here you need a conjugated verb, because the sentence is talking about what the friend does:

• camminare = to walk
• cammina = he/she walks, is walking

Since amico is third person singular, the verb becomes cammina.

In this kind of sentence, che does not change for masculine/feminine or singular/plural.

So you can say:

• l’amico che cammina
• l’amica che cammina
• gli amici che camminano
• le amiche che camminano

What changes is the verb if needed, not che itself.

Nel is the contraction of:

• in + il = nel

So:

• nel giardino = in the garden

This kind of contraction is very common in Italian:

• in + il = nel
• in + lo = nello
• in + la = nella
• in + i = nei
• in + gli = negli
• in + le = nelle

Italian uses articles more often than English does. Here giardino is introduced with the:

• il giardino = the garden
• nel giardino = in the garden

So even where English might sometimes be flexible, Italian often prefers an article with the noun.

Here alto comes after è because it is a predicate adjective. It describes the subject through the verb essere:

• è alto = is tall

This is different from putting an adjective directly next to a noun.

In this sentence:

• Il mio amico ... è alto
  = My friend ... is tall

The adjective is part of the statement about the friend, not part of the noun phrase itself.

Because the sentence contains a main clause and a relative clause.

• Main clause: Il mio amico è alto
• Relative clause: che cammina nel giardino

Each clause has its own verb:

• cammina belongs to the relative clause
• è belongs to the main clause

So this is completely normal Italian sentence structure.

Usually, yes, it can mean that in context. Italian often uses the simple present where English might use either:

• walks
• is walking

So cammina can mean either walks or is walking, depending on the situation.

Italian is a pro-drop language, which means subject pronouns are often omitted when the verb already makes the subject clear.

So instead of saying:

• Lui è alto

Italian often simply says:

• È alto

In your sentence, the subject is already clearly il mio amico, so no extra pronoun is needed.

The accent distinguishes è from e.

• è = is
• e = and

So the accent is important because it changes the meaning completely.

Because of the structure of the sentence. The relative clause comes right after amico, so it naturally modifies amico:

• Il mio amico [che cammina nel giardino] è alto

That means the friend who is walking in the garden.

If it were describing giardino, the sentence would need a different structure.