VS Code 1.130.0
Microsoft has released Visual Studio Code 1.130.0, the latest update to the popular code editor, on July 22, 2026. This release brings significant improvements to the agent experience, chat functionality, and terminal integration.
What Changed
The headline feature in VS Code 1.130 is the introduction of the Agent Host — a dedicated process that runs agent harnesses such as Copilot, Claude, and Codex. Sessions now live in their own process and can be connected to from multiple VS Code windows simultaneously, marking a major architectural shift for AI-powered coding workflows.
The Agent Host is built on the Agent Host Protocol (AHP) and its Copilot agent is powered by the Copilot SDK, aligning behavior with the Copilot CLI and standalone Copilot apps.
Assisted Tool Approvals
A new Assisted Permissions feature reduces approval interruptions during agent tasks. When enabled via the chat.assistedPermissions.enabled setting, the language model evaluates the risk of each tool call and decides whether it can run autonomously or requires user approval. This significantly streamlines long-running agent sessions.
Agents Window Improvements
The Agents window (still in Preview) receives several quality-of-life updates: file-level diff statistics showing insertion and deletion counts, a more compact multi-file diff view, compact quick-chat rows for agent-host sessions, and worktree support for all agent harnesses — not just Copilot.
Chat and Terminal Updates
Chat now includes timestamps for requests and responses, visible by hovering over the message toolbar (configurable via chat.verbose). Copilot Business and Enterprise users gain visibility into aggregate AI credit usage for their billing cycle directly from the Copilot status menu.
In the terminal, VS Code 1.130 adds support for clickable file links in Git diffs when mnemonic prefixes are enabled. The editor recognizes i/ and w/ prefixes and correctly opens the target file.
Engineering
The VS Code repository now compiles using the release version of TypeScript 7, reflecting the broader ecosystem migration to Microsoft latest type system iteration.
VS Code 1.130.0 is rolling out gradually to all users via the built-in update mechanism. Users can also download the nightly Insiders build for early access to upcoming features.