Poisoned cheese is used in the Ratcatchers quest to poison rats in 4 rat holes in the warehouse in the south-west corner of South-east Varrock. It is created by using rat poison on cheese.
If the player attempts to eat it, the player's character will state: "Ummm... let me think about this one.....No! That would be stupid." Due to it not being consumable, it has no use outside of the quest.
Attempting to place the poisoned cheese in a rat hole after the completion of the quest would result in the message "Putting things in poisoned rat holes isn't my idea of fun."
Using it on a Rat trap (near the Rat Pits) will yield a message in your chatbox saying that it's an over kill and normal cheese will work fine.