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Windows Terminal is a modern host application for the command-line shells you already love, like Command Prompt, PowerShell, and bash (via Windows Subsystem for Linux (WSL)). Its main features include multiple tabs, panes, Unicode and UTF-8 character support, a GPU accelerated text rendering engine, and the ability to create your own themes and customize text, colors, backgrounds, and shortcuts.
Note
For more general info, check out Scott Hanselman's article: What's the difference between a console, a terminal, and a shell? or Rich Turner's video What is a command-line shell?.
Multiple profiles supporting a variety of command line applications
You can run any application with a command line interface inside Windows Terminal. This capability includes everything from PowerShell and Command Prompt to Azure Cloud Shell and any WSL distribution such as Ubuntu or Oh-My-Zsh.
Tab tearout
You can tear out tabs in Windows Terminal and create new windows.

You can also drag and drop tabs into existing windows.

Customized schemes and configurations
You can configure your Windows Terminal to have a variety of color schemes and settings. To learn how to customize your prompt with cool themes, see Tutorial: Set up a custom prompt for PowerShell or WSL with Oh My Posh To learn how to make your own color scheme, visit the Color schemes page.
Custom actions
Windows Terminal offers a variety of custom commands you can use to make it feel more natural to you. If you don't like a particular keyboard shortcut, change it to whatever you prefer.
For example, the default shortcut to copy text from the command line is Ctrl+Shift+C. You can change this shortcut to Ctrl+1 or whatever you prefer. To open a new tab, the default shortcut is Ctrl+Shift+T, but maybe you want to change this shortcut to Ctrl+2. The default shortcut to flip between the tabs you have open is Ctrl+Tab. You could change this shortcut to Ctrl+- and use it to create a new tab instead.
For more information about customizing shortcuts, see the Actions page.
Unicode and UTF-8 character support
Windows Terminal can display Unicode and UTF-8 characters such as emoji and characters from a variety of languages.
GPU accelerated text rendering
Windows Terminal uses the GPU to render its text, so it provides better performance than the default Windows command line experience.
Background image support
You can have background images and GIFs inside your Windows Terminal window. For information on how to add background images to your profile, see the Profile - Appearance page.
Command line arguments
You can set Windows Terminal to launch in a specific configuration by using command line arguments. You can specify which profile to open in a new tab, which folder directory should be selected, open the terminal with split window panes, and choose which tab should be in focus.
For example, to open Windows Terminal from PowerShell with three panes, with the left pane running a Command Prompt profile and the right pane split between your PowerShell and your default profile running WSL, enter:
wt -p "Command Prompt" `; split-pane -p "Windows PowerShell" `; split-pane -H wsl.exe
For more information about setting up command-line arguments, see the Command line arguments page.
Windows Terminal