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2.
To have sex.
Later tonight I think I'll pull Sharon back and cut some rug.
by Lust in a Can June 22, 2006
 
1.
Variation of "cut a rug" (i.e. 'to dance enthusiastically') - a term that became popular jargon in the 1920s.

The basis for the phrase comes from wear created by over-use of (by dancing on) an area of carpet.

Used in The Blutones' song 'Cut Some Rug' (You say I can talk to you anytime, Though I just wanna cut some rug).
This is a great song! Wanna get up and cut some rug?
by Wizzzzo October 04, 2010
 
3.
To have sex, as used by The Bluetones in the aptly named song 'Cut Some Rug.'
"You say I can talk to you anytime
But I just wanna cut some rug"
by sugar-spun-sister November 20, 2006