cursor.diffs.useCharacterLevelDiffs stopped working few month ago. I guess it’s bug because it’s working on Antigravity, Claude Code, VS Code, Trae - you name it. Only Cursor not working… Even in Cursor CHAT Character Level Diffs working by setting some parameters (I forgot, but maybe “cursor.diffs.useCharacterLevelDiffs”: true and something else? Not sure), so weird…
Hey, this is a known issue. The cursor.diffs.useCharacterLevelDiffs setting was intentionally removed back in version 2.0.60 because it was too often showing inaccurate diffs. That’s why it now shows up as an unknown setting.
You’re right that character-level diffs still work in the Chat window, but they were intentionally removed from the editor diff view.
This is a very popular feature request that a lot of users want back. Here’s the main thread with lots of discussion and votes: cursor.diffs.useCharacterLevelDiffs