Claude Code (Part 3)

Neil HaddleyJanuary 21, 2026

Context

AIai

📚 Core Concept: What is "Context"?

In Claude Code, context is the working information Claude can use. It includes your conversation history, manually loaded files, selections, and persistent instructions from files like CLAUDE.md.

🗂️ Persistent Context (Project "Memory")

The CLAUDE.md file acts as Claude's persistent memory for a project, automatically loaded at the start of every session.

- Purpose: Stores project-specific instructions, commands, and rules (e.g., coding styles, common tasks).

- Creation: Use /init in the CLI or create it manually in your project's root.

- Key Fact: The old # key shortcut to add to this file is deprecated. Now, you simply ask Claude to update the file for you.

🎮 Interactive Session & Context Management

These commands manage the active context during a session.

Command/FeaturePrimary FunctionPro Tip
@Manually load any file or folder into context.Use for files not automatically included.
/clearReset session history.Use when starting a completely new task.
/compactSummarize a long conversation to save space.Use after finishing a major task phase.
Esc (once)Stop Claude's current response.The standard "stop" button.
Esc (twice)Rewind to a previous point in the chat.Be aware of a past bug (v2.0.5) that could cause freezes.
/exitEnd the CLI session.Returns you to your system terminal.

🖥️ Key Interface Difference: CLI vs. VS Code Extension

How you add context differs significantly between interfaces.

Context TypeClaude Code CLIClaude Code VS Code Extension
Project FilesManual only via @ mentions.Automatic for the currently active editor file.
Selected CodeNot seen unless manually referenced.Automatically seen when text is highlighted.
Workflow FeelCommand-driven, terminal-centric.Integrated, like a pair programmer inside your editor.

💡 Best Practices & Summary

Foundation: Create a concise CLAUDE.md for project-wide rules.

During Work:

In VS Code, leverage the automatic context for the file you're editing.

In the CLI, actively use @ to pull in files.

Session Hygiene: Use /compact to preserve long conversations and /clear to reset for a new topic.

Tool Choice: Use the VS Code extension for integrated coding and the CLI for advanced terminal operations or MCP server work.

In short, Claude Code's context is a blend of persistent project memory (CLAUDE.md) and dynamic session control (commands and auto-context), with the interface you choose shaping your workflow.

ESC ESC. I reviewed the Context. I selected the first "point"

ESC ESC. I reviewed the Context. I selected the first "point"

Restore code and conversation

Restore code and conversation

ESC ESC. I reviewed the Context

ESC ESC. I reviewed the Context

/compact

/compact

ESC ESC. I reviewed the Context

ESC ESC. I reviewed the Context

/clear

/clear

ESC ESC. I reviewed the Context

ESC ESC. I reviewed the Context