Design patterns in Rails provide a reusable solution to commonly occurring problems in software design. They offer a way to structure your code in a manner that is efficient, scalable, and easy to understand. By using design patterns, you can reduce the complexity of your code, making it easier to maintain and debug. They also improve code readability, which is crucial when working in a team environment. Furthermore, design patterns can enhance the performance of your application by reducing unnecessary database queries and optimizing code execution.