ne's manual

4.8.8: AutoIndent

automatically insert tabs and spaces on a new line (created by an InsertLine command, or by automatic word wrapping) in such a way to replicate the initial spaces of the previous line. Most useful for indenting programs.

If you call this command with no arguments, it will toggle the flag. If you specify 0 or 1, the flag will be set to false or true, respectively. A lower case `a' will appear on the status bar if the flag is true.

AutoIndent features a nice interaction with Undo. Whenever a new line is created, the insertion of spaces is recorded as a separate action in the undo buffer (with respect to the line creation). If you are not satisfied with the indentation, just give the Undo command and the indentation will disappear (but the new line will remain in place, since its creation has been recorded as a separate action). See Undo.