By means of the C64U Menu many configuration options are available. Like for example to switch the video output from PAL to NTSC.
If you wish to run a game that expects specifically PAL or NTSC you can go to the C64 Menu and change the setting. Or you can create a configuration file in the same directory as that game to change that setting. Run that configuration file to switch the setting directly. So you can run your game with minimal hassle.
It can be used for much more than switching the video-output format.
It is a shortcut. Like a macro.
This MonroeWorld video gives a good overview how to use this.
Note: The C64 Ultimate and the Ultimate 64, where it is based on, are very similar in hardware and software. Be they differ enough that the configuration files from the Ultimate 64 are not compatible with the C64U. (or at least in early January 2026 it is so)