[Solved]-Python error AttributeError: 'str' object has no attribute 'setdefault'

Each element in the DATABASES dict must itself be a dict. You have overwritten the ‘default’ entry to just be a string.

Since you are using sqlite3 and the default database name, you should just revert to the original version of the setting:

DATABASES = {
    'default': {
        'ENGINE': 'django.db.backends.sqlite3',
        'NAME': os.path.join(BASE_DIR, 'db.sqlite3'),
    }
}