How to Use DeepSeek V3 with Cursor Agent Mode

If you are a developer that is running Cursor as your IDE, you have probably had the ability to experiment with different AI agents in pursuit of productivity. One of the most exciting new offerings is DeepSeek V3 is open-source LLM, with added capabilities for code generation, reasoning, and multi-turn conversations.

It is easy to see the power of DeepSeek combined with Cursor's Agent Mode, providing you with a great AI Coding assistant because DeepSeek also understands code at an input-to-output basis and is effective at completing long prompts with consistent responses. In the following guide you will learn how to include DeepSeek V3 in Cursor, set agent settings, address issues, and successfully enhance your development experience.

What Is DeepSeek V3?

DeepSeek V3 is a state-of-the-art Mixture-of-Experts (MoE) large language model built by DeepSeek AI. Unlike transformer based LLMs which run through all of the layers one after the other, MoE models only turn on a collection of the layers during inference to actively infer text at a fraction of the cost of a typical LLM while preserving inference accuracy.

Total Parameters: 670+ billion

Active at Inference: 37 billion parameters

Performance: On benchmarks like MMLU, HumanEval, and Code Generation, it performs at par or better than commercial models like GPT-4 and Claude 3.5.

Main Advantages

• Incredible capabilities at mathematics, reasoning, and programming capabilities.

• Cost effective and open-source.

• Optimized for developer experiences and workflows.

What Is Cursor and Agent Mode?

Cursor is a well-known AI-powered code editor that is a wrapper around VS Code, what makes Cursor special is their Agent Mode which enables large language models to not just be passive assistants, but interactive agents. In Agent Mode, agents can have continuous conversations that take into account context over a longer context window, which can be used for iterative tasks such as debugging, making changes to a function, or making edits across multiple files.

DeepSeek V3 is natively supported in Cursor v0.44+ where developers can set it as their default agent without an API key, but they also have options for custom self-hosting.

Why Use DeepSeek V3 with Cursor Agent Mode?

This is why many developers are moving to DeepSeek:

• Consistency: DeepSeek keeps context across long conversations consistently.

• Code-First Performance: It does a great job at coding tasks of generating, editing, and explaining code with little hallucination.

• Free for Most Users: No premium version is required by Cursor’s hosted version of DeepSeek V3.

• Speed and Effectiveness: The responses of DeepSeek are faster than other types of agents even for longer prompts especially if self-hosted on Docker or Ollama.

If you are looking for a consistent agent that works effectively inside the Cursor chat and Composer UIs than DeepSeek is a great agent for you.

Step-by-Step Guide: Setting Up DeepSeek V3 in Cursor

Step 1: Setting Up Your Environment

Before diving into model settings, make sure your development environment is ready:

• Cursor IDE: Version 0.44 or higher

• Python: v3.10+ for any local scripting

• Node.js: Optional, but helpful for plugin-related extensions

• Docker (Optional): Required only if you want to self-host DeepSeek using Ollama or a public Docker image

Step 2: Install DeepSeek

Option 1: Use Cursor’s Hosted DeepSeek

This is the simplest and easiest setup since Cursor also natively supports DeepSeek V3 and V3.1 (0324) and does not require an API key.

Just open Cursor → Settings → Models → Select deepseek-v3 or deepseek-v3-0324.

Option 2: Run DeepSeek Locally

Want a faster response or want more control? Then use Docker or Ollama:

bashCopyEditollama run deepseek-coder:8b
# or Docker
docker run -p 8080:8080 deepseek/v3-model

After that, in cursor.json or settings, set the base url:

jsonCopyEdit{
  "openai_base_url": "http://localhost:8080/v1",
  "api_key": "ollama"
}

Installing Dependencies

Since you will be doing local development, make sure the following python and node modules are available! Cursor takes care of the majority of the dependencies on the model side, but you may be required to install:

bashCopyEditpip install requests

Step 3: Setting Up Cursor for Agent Mode

After installing or selecting DeepSeek:

• Navigate to Settings → Agent Mode

• Enable Agent Mode and set deepseek-v3 or deepseek-v3-0324 as the default agent

• You can also switch agents on the fly via the Chat UI (Ctrl+L)

Recommended Agent Settings

• Temperature: 0.1–0.3 for code accuracy

• Max Tokens: 1024–2048 depending on task size

• Context Window: DeepSeek supports a length of up to 64K, but please try to keep your prompts as brief as possible.

Step 4: Running Your First Prompt

Open Cursor Chat and type:

pgsqlCopyEditWrite a function in Go to reverse a string.

DeepSeek should return clean, easy to read code, and for those iterative prompts, you can still use Composer:

vbnetCopyEditNow convert this function to use a rune slice and handle Unicode.

It should generate updated code with appropriate context.

Step 5: How to avoid common issues you may encounter

• Agent Not Detected: Ensure you are on cursor 0.44+ and that the model you wish to use is enabled in settings.

• No Response or Crash: If you are self-hosting check your memory usage or endpoint is still available.

• Dependency Errors: Run pip freeze or npm list to check local libraries.

• Blank Output in Composer: Blank output in Composer: toggle "Fast Use" or refresh the workspace.

Advanced Tips for Power Users

• Switch Models Easily: Use fallback chains (Claude → DeepSeek) from within the settings of Cursor.

• Use with Autocomplete: DeepSeek integrates neatly with inline code completion due to the low latency.

• Self-hosting for Teams: For teams, you can deploy DeepSeek across cloud VMs or containers and enjoy the shared access.

• Monitor Performance: You will be able to monitor logs and token stats to help you manage your context window efficiently.

DeepSeek V3 vs. Other Cursor Agents

DeepSeek is well suited for coding-dominant workflows. On the other hand, although Claude is particularly good at multi-tool orchestration, DeepSeek is faster and cost-effective for most devs.

Conclusion

DeepSeek V3 redefined your experience inside Cursor, especially when using it with Agent Mode. Whether you are writing tests, refactoring legacy code, or simply experimenting, DeepSeek provides accurate contextual assistance accurately without the premium prices of GPT or Claude.

Combined with Cursor interactive workflows, DeepSeek gives you a very productive developer ecosystem.

FAQs

Do I need an API key?

Not if you are using Cursor's hosted version. Only if you are operating an endpoint from an external provider or self-hosting.

Is DeepSeek open source?

Yes. It is available via HuggingFace and Ollama-compatible images.

Does it work on Windows/Linux?

Yes. Both Cursor and DeepSeek are platform agnostic.

How do I update the model?

For hosted: Cursor updates by itself. For Docker/Ollama: manually pull the latest version.