Inspired by the "Danger Room" at Canterlot Palace, Applejack and Rainbow Dash designed an obstacle course to go into an empty field on the road between Sweet Apple Acres and the rest of the town.
To avoid a recurrence of the problems at the "Iron Pony Competition," the course was designed to be usable by Pegasi, Earth Ponies, and Unicorns alike without unduly limiting the abilities of one type or giving an unfair advantage to another. The only "pony type" restriction specifically made was "no teleporting."
The primary goal of the course is to navigate a series of obstacles and get to the end first. Bonus points may be earned by collecting the flags placed on the course, and points are lost for skipping or missing obstacles. The highest score possible is 50 (20 points for finishing first, 30 points for collecting all flags, no missed items); it is also possible to come in last and still win purely on points (by collecting all the flags, for instance, or if the winner skips multiple obstacles).
The site was designed by Applejack and Rainbow Dash during the time between Twilight Sparkle's three-day tenure as Princess Regent, and the following Nightmare Night. On the following Monday, it was built over the course of a day by a team of volunteers from Ponyville, including Alberio, DrewScroll, CarrotTop, Uncle Orange, Rocky Skies, Kiryn Gearwings, Tower, FinalScore, Soarin, and others. Since so many ponies were involved in its construction, Applejack and Rainbow Dash decided it should be available for use by the entire town.