In Magento 2, the System.xml file creates the system configuration fields. If you are a developer and developing a Magento 2 extension, you may require to create system.xml file to create backend configuration menu.
You can alter or tweak the system.xml file in the Magento 2 source code to customize the field that you want to show to the admin at the Admin Panel > Stores > Configuration. All you need to do is create system.xml configuration in Magento 2, and place the file to the etc/adminhtml/ directory of the extension path.
The admin configuration part is divided into main four elements, i.e. Tabs, Sections, Groups, and Fields. You can add those elements in the code as per your requirements and customize the admin configuration. You can learn more at https://meetanshi.com/blog/create-system-xml-configuration-in-magento-2/
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