Questions, answered

There are two: .cursor/mcp.json inside a project for servers that belong to that project, and ~/.cursor/mcp.json in your home directory for servers you want everywhere. Both use the same mcpServers format.

Yes. The CLI uses the same configuration as the editor, so every server in mcp.json is available to the agent CLI. agent mcp list shows them with their connection status.

Use interpolation: write ${env:NAME} in env, url or headers and set the variable in your shell. For a local stdio server you can also point envFile at a .env file. Remote servers do not support envFile.

Yes. Open Customize in the sidebar, find the server and use its toggle. Disabled servers do not load or appear in chat, which also helps when too many tools crowd the agent.

By default, yes: Cursor asks for approval before it uses an MCP tool, and you can expand the call to see its arguments. MCP tools follow the same Run Modes as terminal commands.