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I'm new to GIS and when I was looking in my data directory I saw .prj-file.

What is that and how is it useful?

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The *.prj file is part of the Shapefile format which is consists of other files:

  • *.shp: contains the feature geometries.
  • *.dbf: contains feature attribute data, as a table.
  • *.shx: indexation data for iterations accross the features.
  • *.prj: the coordinate reference system represented as text.

In a word, the *.prj file informs on the coordinate reference system in which the geometry coordinates are expressed. It is used by GIS software in particular when data with different CRSs are used. You can still work without this file, in particular if all your data is in a well-known CRS, but it is not a very good practice.

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  • I would amend this answer to say that having the prj is not a necessity if all your data is in any coordinate system, so long as it is all in the same coordinate system. (It does not need to be a well-known CRS - it could even be assumed coordinates.) However, if you will be sharing data with others, using the prj file is an established practice - one that I can't think of any reason not to maintain. – gspontak May 13 at 16:11
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There are other uses of the .prj file, it doesn't 100% have to be associated with a shapefile, however that is certainly its origins. Within ESRI packages, a .prj file could also be used to:

  • store custom coordinate sytem definitions, which could be imported and used as a Data frame definition
  • associated to a CAD file, such that when opening within ArcMap, a coordinate system reference is used. (see here for more details - https://support.esri.com/en/technical-article/000007831 )

Other systems may also be able to use the .prj file as a reference for the coordinate system.

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