Precedent is a judicial decision that serves as an authority for courts when deciding subsequent identical or similar cases. Fundamental to common law legal systems, precedent operates under the principle of stare decisis ("to stand by things decided"), where past judicial decisions serve as case law to guide future rulings, thus promoting consistency and predictability.

Precedent is a defining feature that sets common law systems apart from civil law systems. In common law, precedent can either be something courts must follow (binding) or something they can consider but do not have to follow (persuasive). Civil law systems, in contrast, are characterized by comprehensive codes and detailed statutes, with little emphasis on precedent (see, jurisprudence constante), and where judges primarily focus on fact-finding and applying the codified law.

Courts in common law systems rely heavily on case law, which refers to the collection of precedents and legal principles established by previous judicial decisions on specific issues or topics. The development of case law depends on the systematic publication and indexing of these decisions in law reports, making them accessible to lawyers, courts, and the general public.

Generally speaking, a legal precedent may be:

Stare decisis (/ˈstɛərri dɪˈsaɪsɪs, ˈstɑːreɪ/) is a judicial doctrine under which courts follow the principles, rules, or standards established in their prior decisions (or those of higher courts) when deciding cases involving the same or closely related issues. The term originates from the Latin phrase stare decisis et non quieta movere, meaning to "stand by the thing decided and do not disturb the calm."

The doctrine operates both horizontally and vertically. Vertical stare decisis binds lower courts to strictly follow the decisions of higher courts within the same jurisdiction. The Seventh Circuit Court of Appeals applying a precedent set by the U.S. Supreme Court is an example of vertical stare decisis. Horizontal stare decisis refers the principle that a court adheres to its own previous rulings.

In the modern era, the U.S. Supreme Court adheres to its prior decisions unless there is a special justification to overrule precedent. By taking this approach, the Court has rejected a strict view of stare decisis that would require it to uphold past rulings regardless of their merits or the practical consequences of maintaining or overturning them.

Ratio decidendi ("the reason for the decision") refers to the key factual element or line of reasoning in a case that forms the basis for the court's final judgment. It forms the basis for a court decision and creates binding precedent. This distinguishes it from other parts of a judicial opinion, such as obiter dicta (non-binding observations or comments).