KnowFeat: Knowledge-Guided Feature Engineering via LLM Agents

Abstract: Automated feature engineering with LLMs can produce semantically meaningful features for tabular data, yet existing methods lack structured domain knowledge, rigorous verification, and explainable provenance. We propose KnowFeat, a knowledge-guided feature engineering framework that organizes domain knowledge into five types -- schema metadata, regulatory indicators, detection rules, expert opinions, and court document evidence -- and injects them as structured context into an LLM agent. A three-stage verification pipeline filters candidates through code execution, statistical quality checks, and model effectiveness evaluation. Every accepted feature carries a provenance record tracing its design to specific knowledge assets. Under a strict held-out protocol that eliminates feature-selection leakage, KnowFeat ranks first (avg. rank 2.3) across twelve public benchmarks among seven methods (one-sided Wilcoxon p=0.017), with a peak gain of +11.6 pp AUC on a telecom churn dataset. On a real-world Bitcoin anti-money laundering (AML) dataset (Elliptic) and a synthetic digital currency AML benchmark (SimECNY), KnowFeat maintains competitive detection performance with full provenance traceability.