Context engineering is the practice of designing the information and tools an AI model has access to so it can perform a task effectively. While prompt engineering focuses on crafting a single, well-worded instruction, context engineering builds a whole environment around the model—supplying the right background data, resources, and capabilities in the right format at the right moment. This can include pulling in relevant documents, summarizing conversation history, or connecting the model to external tools like databases, APIs, and calculators. The goal is to make sure the AI starts its work already equipped with exactly what it needs, rather than relying on clever phrasing alone.
The rise of large language models (LLMs) and AI “agents” has made context engineering one of the most important new skills in AI development. It treats AI interaction as a system design challenge, not just a messaging exercise. Instead of handing the model a static prompt, developers assemble context dynamically—selecting and formatting information based on the specific task, user, and situation. This systematic approach leads to more accurate, reliable, and scalable AI systems, especially in enterprise environments where the model must operate within complex workflows.
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An emerging example of context engineering in action is the Model Context Protocol (MCP), an open standard supported by companies like Anthropic, OpenAI, and Microsoft. MCP allows AI systems to request and receive relevant data and tool access in a consistent way, making it easier to build adaptive agents. In practice, context engineering often means combining retrieval systems, summarization pipelines, and structured formatting so the model sees the “signal” without the “noise.”
A helpful way to picture this is to imagine an AI as the captain of a ship. Prompt engineering is like shouting a clear order from the deck. Context engineering is what happens below deck—the crew fetching the right maps, checking the weather, loading the right cargo, and handing up the exact tools the captain will need to navigate. The result is a smoother, faster, and more successful voyage toward the task at hand.