Continue.dev Rules & Config: Complete Setup Guide (2026)

⚠️ Continue.dev Has Been Discontinued

Continue.dev was acquired by Cursor in an acqui-hire announced June 16, 2026, and the product has been shut down. The final release (v2.0.0-vscode) shipped June 19, 2026. The GitHub repository is now read-only. Cloud-hosted data (hub configs, synced settings) was deleted after July 15, 2026 — that deadline has passed.

What this means for you:

• If you already have Continue installed with a local config.yaml, it will likely keep working for a while — the extension itself hasn't been remotely disabled. But there will be no further updates, security patches, or fixes when AI provider APIs change.
• New installs are not recommended. Do not adopt Continue.dev for a new project.
• The Apache 2.0 codebase remains available to fork, but the original team is not maintaining it going forward.

Where to go instead: Cline is the closest direct replacement — same open-source, BYOK, VS Code extension model, and it's actively maintained with a growing feature set (MCP marketplace, Checkpoints, conditional rules). See the Cline Rules guide to get started, or Cline vs Aider if you want to compare it against a terminal-first alternative.

The configuration reference below is preserved for anyone still running a pinned or forked version of Continue, but should be treated as historical rather than actively maintained documentation.

Originally published April 2026 · Archived reference for config.yaml, VS Code and JetBrains

Continue.dev was one of the most configurable open-source AI coding assistants available, letting you design exactly how AI fit into your workflow: which models handled autocomplete vs. chat vs. agent tasks, what rules shaped the AI's behaviour, which context sources it drew from, and which MCP tools it could use.

This guide — preserved for historical and fork-maintenance reference — covers Continue's configuration system as it existed before the shutdown: the config.yaml format, the rules system, model setup for different roles, context providers, MCP integration, and templates for common stacks.

1. How Continue Loaded Configuration

Continue read configuration from two levels:

Priority: Workspace configuration extends and overrides global configuration. Rules defined in the workspace .continue/rules/ folder were automatically active when working in that project, regardless of the global config.

Config format: YAML vs JSON

Continue supported both config.yaml (the recommended format) and the legacy config.json. If config.yaml existed, it took precedence.

2. The Rules System

Rules were the primary way to give Continue standing instructions about how to write code in your project — plain Markdown files stored in .continue/rules/ at the workspace root, loaded automatically whenever you worked in that project.

Rule file format

Each rule file was a Markdown document with an optional YAML frontmatter block:

---
name: TypeScript Standards
globs: "**/*.{ts,tsx}"
alwaysApply: false
description: Coding standards for TypeScript and React files
---

# TypeScript Standards

- Strict mode enabled. No `any` types — use `unknown` and narrow it.
- Named exports for all components and utilities.

Frontmatter properties

3. config.yaml — Reference Example

name: My Dev Config
version: 1.0.0
schema: v1

models:
  - name: Claude Sonnet 4.6
    provider: anthropic
    model: claude-sonnet-4-6
    roles: [chat, edit, agent]
    apiKey: ${{ secrets.ANTHROPIC_API_KEY }}

  - name: Claude Haiku
    provider: anthropic
    model: claude-haiku-4-5-20251001
    roles: [autocomplete]
    apiKey: ${{ secrets.ANTHROPIC_API_KEY }}

rules:
  - Give concise responses. Skip preamble — get to the answer.
  - Never delete files without asking for confirmation.

context:
  - name: codebase
  - name: diff
  - name: terminal
  - name: problems

mcpServers:
  - name: filesystem
    command: npx
    args: ["-y", "@modelcontextprotocol/server-filesystem", "/path/to/project"]

prompts:
  - name: review
    description: Review this code for bugs and issues
    prompt: |
      Review this code for logic errors, security issues, and
      inconsistencies with project conventions.

Model roles

4. Model Configuration by Provider (Reference)

# Anthropic
models:
  - name: Claude Sonnet 4.6
    provider: anthropic
    model: claude-sonnet-4-6
    roles: [chat, edit, agent]
    apiKey: ${{ secrets.ANTHROPIC_API_KEY }}

# Ollama (local, free, private)
models:
  - name: Codestral
    provider: ollama
    model: codestral:latest
    roles: [autocomplete]

Local models via Ollama kept all code processing on-machine — no external API calls. This privacy architecture is the reason Cline with Ollama, or Aider with Ollama, are the natural successors for anyone who specifically valued this about Continue.

5. Project-Level Rules Structure (Reference)

.continue/
  rules/
    01-general.md       # Behaviour and communication
    02-stack.md         # Tech stack constraints
    03-code-style.md    # Naming, formatting, patterns
    04-error-handling.md
    05-testing.md
    06-git.md

---
name: General Behaviour
alwaysApply: true
---

- Give concise answers. Skip unnecessary preamble.
- If a task is ambiguous, ask one clarifying question before proceeding.
- Never delete files without asking for confirmation first.

6. Context Providers (Reference)

context:
  - name: codebase      # @codebase — semantic search across indexed repo
  - name: diff           # @diff — shows current git diff
  - name: terminal        # @terminal — pastes last terminal output
  - name: problems        # @problems — current lint/type errors
  - name: docs             # @docs — index and search external documentation

7. MCP Tools Integration (Reference)

mcpServers:
  - name: postgres
    command: npx
    args: ["-y", "@modelcontextprotocol/server-postgres"]
    env:
      POSTGRES_CONNECTION_STRING: ${{ secrets.DATABASE_URL }}

For an actively maintained MCP setup today, see How to Set Up MCP Servers for AI Coding Agents, which covers Cline, Cursor, Claude Code, and Windsurf.

Frequently Asked Questions

Is Continue.dev still available?

The extension may still be installable and functional if you already have it configured, since it hasn't been remotely disabled. But the product is discontinued — no new features, no security patches, no fixes for breaking API changes from model providers. Do not adopt it for new work.

What happened to Continue.dev?

Cursor (Anysphere) acquired Continue in an acqui-hire announced June 16, 2026 — its third major acquisition in 18 months after Supermaven and Graphite. The product was shut down; the final release shipped June 19, 2026, and the GitHub repository is now read-only. This happened in the same period SpaceX announced its $60 billion acquisition of Cursor itself.

What should I switch to?

Cline is the closest direct replacement — free, open-source, BYOK, VS Code extension, actively maintained. If you specifically valued Continue's terminal-adjacent scriptability, Aider is also open-source and BYOK. See Cline vs Aider to compare the two.

Can I still use my existing Continue.dev config?

The config.yaml format described in this guide is preserved for reference if you're running a pinned version or a community fork. The Apache 2.0 codebase remains legally forkable, but expect no official updates or provider API compatibility fixes going forward.

Is my data safe if I used Continue's hub/cloud features?

Cloud-hosted data (synced configs, hub-managed settings) was scheduled for deletion after July 15, 2026, which has now passed. If you relied on cloud sync, that data is very likely gone. Local config.yaml files on your own machine are unaffected by this.

Related

• Cline Rules guide — the recommended replacement, .clinerules configuration
• Aider Rules guide — terminal-first alternative with similar open-source/BYOK philosophy
• Cline vs Aider — comparing the two leading free replacements
• How to Set Up MCP Servers — current MCP configuration across active tools
• AI Coding Tools: Privacy & Security Compared — BYOK and local-model architecture explained
• Best Cursor Alternatives — full, current comparison of active tools