The boot.ini file is a configuration file used in older versions of the Windows operating system, specifically Windows NT, 2000, and XP. It contains information about the operating system's boot process, including the location of the operating system files and the options available for booting. When a computer starts, the boot.ini file is read to determine which operating system to load and any specific parameters needed for that process. Users can edit this file to customize boot options, such as setting a default operating system or adding new entries for multiple installations.