Daniel Cazzulino's Blog

First go get the tool. It’s free and it rocks.

Next, save this XML to a file with a .vssettings extension:

<UserSettings>
    <ApplicationIdentity version="10.0"/>
    <Category name="Source Control_TeamFoundation" Category="{2A718788-A6D9-44C5-90EF-438BF5B06A74}" Package="{4CA58AB2-18FA-4F8D-95D4-32DDF27D184C}" RegisteredName="Source Control_TeamFoundation" PackageName="Microsoft.VisualStudio.TeamFoundation.VersionControl.HatPackage, Microsoft.VisualStudio.TeamFoundation.VersionControl, Version=10.0.0.0, Culture=neutral, PublicKeyToken=b03f5f7f11d50a3a">
        <PropertyValue name="UserTool1" extension=".*" operation="Compare" command="C:\Program Files (x86)\SourceGear\DiffMerge\DiffMerge.exe" arguments="/title1=%6 /title2=%7 %1 %2"/>
        <PropertyValue name="UserTool2" extension=".*" operation="Merge" command="C:\Program Files (x86)\SourceGear\DiffMerge\DiffMerge.exe" arguments="/title1=%6 /title2=%8 /title3=%7 /result=%4 %1 %3 %2"/>
    </Category>
</UserSettings>

Finally, go to Tools > Import and Export Settings in VS and import that file by clicking Browse on the third and final page.

What this does is set the great SourceGear DiffMerge tool as the diff and merge tool to use for all your files. I find it much more usable and smart than the built-in TFS one.

For the ultimate collection of settings for diff/merge tools in VS, see James’ blog post.

Enjoy.