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Dictionary

Context Engineering

Context engineering is the discipline of deciding exactly what information enters a model's context window, in what order and at what cost.

2 min readupdated 2026-08-01

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Prompt engineering writes instructions; context engineering manages the whole payload — system rules, retrieved knowledge, tool schemas, conversation history and tool output. The core moves are: retrieve instead of dumping, summarise before re-injecting, cache stable prefixes, and cut anything that hasn't changed a decision. Most agent quality and cost problems are context problems.

Context engineering is the discipline of deciding exactly what information enters a model's context window, in what order and at what cost. Prompt engineering writes instructions; context engineering manages the whole payload — system rules, retrieved knowledge, tool schemas, conversation history and tool output. The core moves are: retrieve instead of dumping, summarise before re-injecting, cache stable prefixes, and cut anything that hasn't changed a decision. Most agent quality and cost problems are context problems. In practice: Replacing a 30k-token document dump with 6 retrieved chunks improved answer accuracy and cut cost per call by 85%. This dictionary node is part of the Onexial knowledge graph and links to related concepts, workflows and tools below.
Definition
Prompt engineering writes instructions; context engineering manages the whole payload — system rules, retrieved knowledge, tool schemas, conversation history and tool output. The core moves are: retrieve instead of dumping, summarise before re-injecting, cache stable prefixes, and cut anything that hasn't changed a decision. Most agent quality and cost problems are context problems.
Example
Replacing a 30k-token document dump with 6 retrieved chunks improved answer accuracy and cut cost per call by 85%.
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What is Context Engineering?

Prompt engineering writes instructions; context engineering manages the whole payload — system rules, retrieved knowledge, tool schemas, conversation history and tool output. The core moves are: retrieve instead of dumping, summarise before re-injecting, cache stable prefixes, and cut anything that hasn't changed a decision. Most agent quality and cost problems are context problems.

What is an example of Context Engineering?

Replacing a 30k-token document dump with 6 retrieved chunks improved answer accuracy and cut cost per call by 85%.

Why does Context Engineering matter for AI and automation?

Context engineering is the discipline of deciding exactly what information enters a model's context window, in what order and at what cost. It connects to the workflows, prompts and tool stacks linked on this page, so you can move from definition to execution without leaving Onexial.

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Related concepts

The vocabulary this page depends on.

  • AI Software Engineering

    AI software engineering is the practice of building software where agents write most of the code and humans own architecture, review and verification.

  • MCP Resources

    MCP resources are addressable read-only context — files, records, docs — that a client can pull into the model instead of calling a tool.

  • MCP (Model Context Protocol)

    Open protocol that lets LLMs connect to tools, data sources and apps through a standard interface.

  • Context Window

    The maximum amount of text (in tokens) an LLM can consider in a single call.

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Related workflows

Turn this into a repeatable process.

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The tools that run it in production.

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Reusable prompts for this job.

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Comparisons & alternatives

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