VS Code and Cline and Continue:
Free Alternative to Cursor AI IDE
In the fast-changing world of AI-driven coding tools, Cursor is one of the most sought-after solutions among developers for its AI capabilities to generate, refactor, and debug code.
But the free version has limitations, and the pro version necessitates a month’s subscription.
If you’re like me and don’t want to spend $20 a month on Cursor’s pro features, there’s a great, open-source, local, and free alternative that you can easily implement now using VS Code and Cline and Continue.
This configuration not only mimics much of Cursor’s functionality but also gives you more control over your data privacy by executing AI models locally or via free APIs.
In this post, I’ll walk you through how to install and configure Visual Studio Code with Continue.dev and Cline extensions, combining local AI models with Ollama, and then conclude using OpenRouter to expand your AI functionality for free. Let’s get started.
Table of Contents
Are You Looking for an Alternative to Cursor?
Cursor is a premium AI-powered code editor built on top of Visual Studio Code (VS Code).
It enables developers to build applications by generating files, writing code, refactoring, and debugging errors using AI models.
Although Cursor’s AI capabilities are great, its free version can be limiting if you’re not willing to spend the $20/month pro version.
In as much as Cursor itself is a fork of VS Code, some consider it to be adding AI to an already available, open-source editor and selling it for profit.
Not that Cursor is not good — they play by VS Code’s license and provide a refined product — but if you’d prefer a free, open-source alternative with the same features, VS Code and Cline and Continue are the way to go.
What is VS Code?
Visual Studio Code, or VS Code, is a free, open-source code editor developed by Microsoft.
It’s beloved by professional developers for its simplicity, powerful features, and extensibility.
Because it’s open source, a large community continuously improves it, making it one of the best code editors available today.
Using VS Code as the base for your AI-powered coding environment means you get all the reliability and flexibility of a mature editor, plus the ability to customize it with extensions like Continue.dev and Cline to replicate Cursor’s AI features — without the cost.
Setting Up Your Free AI-Powered Code Editor
Step 1: Install Visual Studio Code
First things first, head over to the VS Code website and download the version that matches your operating system (Windows, Mac, or Linux). The installation is straightforward, and once complete, you’ll have a robust code editor ready to be enhanced with AI capabilities.
Step 2: Install Ollama for Local AI Models
Ollama is a fantastic tool that allows you to download and run powerful open-source AI models locally on your machine.
This means you can use AI for code completion and chat features without needing an internet connection every time, and your data stays private on your device.
Visit Ollama’s website to download and install the application. Through Ollama, you can pull models like DeepSeek R1 and Qwen, which are excellent for AI coding tasks.
Note: Running local models requires enough storage space, so make sure your system has sufficient memory. If storage or internet speed is a concern, you can later switch to a free API-based alternative using OpenRouter, which I’ll cover below.
Step 3: Install the Continue.dev and Cline Extensions in VS Code
Open VS Code and navigate to the Extensions tab on the sidebar. Search for Continue.dev and install it. Then search for Cline and install that extension as well.
These two extensions form the core AI features similar to Cursor:
Continue.dev provides AI chat, inline code completion, and editing capabilities.
Cline offers advanced multi-file editing and agentic capabilities, allowing the AI to plan and execute multi-step coding tasks like creating entire projects, running commands, and managing dependencies.
Step 4: Configure Continue.dev with Ollama Models
Once installed, open the Continue.dev extension panel. You’ll see a default assistant model that you can disable. Click the cube icon to configure which AI models Continue.dev uses.
Using Ollama, you can download these AI models locally by opening your terminal and running:
ollama pull deepsr1
ollama pull qwen-2.5-coderThe DeepSeek R1 model, with 7 billion parameters, works well for chat and coding questions, while the smaller Qwen 2.5 coder model (1.5 billion parameters) is sufficient for autocomplete features.
Larger models don’t necessarily improve autocomplete performance significantly, so these are a great balance between capability and resource usage.
After downloading, set the model names and providers in Continue.dev’s configuration file (config.yaml) accordingly:
For chat: model name
deepsr1with Ollama as the provider.For code completion: model name
qwen-2.5-coderwith Ollama, ensuring you specify the role as well.
Save the configuration and restart VS Code if necessary. Now, Continue.dev will use your local AI models for chat and autocomplete.
Step 5: Set Up the Cline Extension and Sign In
Cline is essential for replicating Cursor’s ability to work across multiple files and run terminal commands automatically.
Open the Cline extension panel and register an account using Google or GitHub. You’ll receive free trial credits that allow you to use powerful AI models through Cline’s interface.
Once signed in, you can start instructing Cline to create projects, write code, and manage dependencies automatically.
For example, you can ask it to generate a simple tic tac toe game using HTML, CSS, and JavaScript, and Cline will plan, create files, and run commands to build the project for you.
Enable the “auto approve” option to let Cline perform safe actions without manual confirmation, streamlining your workflow.
Testing Your New AI-Powered Setup
To verify everything works, create a simple Python file and test Continue.dev’s autocomplete by writing a function to add two numbers.
You should see inline suggestions that you can accept with the Tab key.
For multi-file editing and project creation, use Cline to generate a complex project.
Once completed, open the HTML file in your browser to play the game.
This demonstrates the power of this free setup, capable of building full applications from a single prompt.
Using OpenRouter as a Free API Alternative
When your free trial credits from Cline run out, or if you want to avoid local model downloads, you can switch to OpenRouter.
OpenRouter provides a unified API to access a wide range of AI models, including powerful ones like DeepSeek R1 and DeepSeek v324, many of which are free to use.
To use OpenRouter with Cline or Continue.dev:
Sign up for an OpenRouter account and create an API key.
Copy the API key.
In your Cline or Continue.dev configuration, change the AI model provider to OpenRouter.
Paste your API key and select the desired model (e.g., DeepSeek R1).
Keep in mind that free models on OpenRouter may experience longer response times or occasional timeouts during peak usage, so patience is key.
Why VS Code and Cline and Continue Are a Superior Choice
Cost-effective: No monthly subscription fees. Use local models or free APIs to keep costs at zero.
Privacy: Running AI models locally with Ollama means your data never leaves your machine, unlike cloud-based editors.
Control: Choose your models, switch providers, and customize configurations freely.
Extensibility: VS Code’s vast ecosystem lets you add other extensions and tools as you grow.
This setup empowers hobbyists and professionals alike to harness AI coding assistance without breaking the bank or sacrificing privacy.
Keyboard Shortcuts and Productivity Tips
Continue.dev offers useful keyboard shortcuts to speed up your workflow:
Control + I (or Command + I on Mac): Edit highlighted code with AI, similar to Cursor’s controllable K feature.
Shortcut panel: Access commands for code suggestions, debugging, and cancelling AI requests.
Using these shortcuts helps you maximize the efficiency of your AI-powered code editor.
Conclusion: A Free, Open-Source Future for AI Coding
If you’re seeking a powerful AI code editor without the cost or limitations of Cursor, setting up VS Code and Cline and Continue is your best option.
With local AI models through Ollama or free APIs via OpenRouter, you get privacy, control, and cutting-edge AI features for free.
Whether you are a hobbyist doing weekend projects or an enterprise developer who wants to try coding with AI assistance, this installation has you set.
You can develop whole projects from concise prompts, receive inline auto-complete, restructure code, and debug — all within your comfortable VS Code development environment.
Try it out, and let me know what you think of this alternative. Your feedback and experience make the community wiser about AI-powered development tools.
Frequently Asked Questions (FAQ)
Is VS Code and Cline and Continue really free?
Yes! VS Code is completely free and open source. Continue.dev and Cline offer free tiers and trial credits, and by using Ollama for local models or OpenRouter’s free API models, you can keep your AI coding setup free of charge.
Do I need a powerful computer to run AI models locally?
Running models like DeepSeek R1 locally requires some storage space and processing power. While you don’t need a top-tier machine, having a decent CPU and enough disk space (several GBs) helps. If your hardware is limited, you can use OpenRouter’s API instead.
How does this setup protect my privacy compared to Cursor?
Because you run AI models locally with Ollama, your code and data do not leave your computer, unlike cloud-based editors where data may be sent to third-party servers. This setup gives you full control over your data.
Can I use this setup for professional projects?
Absolutely. VS Code is a professional-grade editor, and the AI extensions provide robust coding assistance. Many developers use similar setups to boost productivity and code quality in commercial projects.
What if I run out of free credits on Cline?
You can switch to OpenRouter’s free models by signing up for an API key and updating your configuration. This allows you to continue using AI features without interruption.
Are there any limitations compared to Cursor?
While this setup replicates most Cursor features, some advanced features like integrated debugging or very large proprietary models might be limited. However, the open-source nature and flexibility often outweigh any minor differences.