AI engineering glossary · ML fundamentals
What is decision threshold?
Decision threshold (also called Classification threshold): The cut-off applied to a model's predicted probability to turn it into a class decision, commonly 0.5. Moving it trades false alarms against misses, so it should be set according to the cost of each type of mistake.
Decision threshold: an example
Flagging a loan as risky when the predicted default probability exceeds 0.3 instead of 0.5 catches more defaulters but rejects more good customers.
Related terms
More ML fundamentals terms
- Discriminative model
- Distribution shift
- Double descent
- Early stopping
- Empirical risk minimisation
- Feature
- Feature space
- Generalisation
Where you learn it
Decision threshold is part of the AI Engineering Program, which teaches it with notes, a hands-on lab and an exam. The first lesson is free.