The `.cursorrules` file is a rulebook for the Cursor editor that tells the AI how to generate or tweak code based on user preferences, ensuring consistency and quality in AI-assisted coding. It was introduced to overcome early AI coding tool limitations, which often produced inconsistent or unconventional code. The file uses a structured JSON format and can be replicated in subdirectories for nuanced control. It provides an example configuration that includes rules for file inclusion, exclusion, token limits, and context settings. Adoption patterns for `.cursorrules` include exploration, team standardization, organization-wide implementation, and integration with DevOps tools. Despite its benefits, the system presents challenges such as configuration overhead, a learning curve, rule conflicts, over-optimization, and tool lock-in. It can be used in various development contexts, including enterprise settings, open source projects, educational environments, and team collaboration, to improve consistency, productivity, and collaboration.