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[ARTICLE · art-47553] src=infoworld.com ↗ pub= topic=developer-tools verified=true sentiment=↑ positive

Visual Studio Code improves tools for agents

Microsoft released Visual Studio Code 1.127, improving tools for AI agents with generally available browser tools and per-site permissions. The update also introduces session organization and subagent credit transparency for managing agent workflows.

read2 min views1 publishedJul 2, 2026

Visual Studio Code 1.127, an update to Microsoft’s popular kinda-sorta open-source code editor, brings improvements to the Agents window for managing agent sessions and makes the browser tools for agents generally available. Browser tools for agents was previously a preview feature.

Released July 1, VS Code 1.127 can be downloaded for Windows, Linux, and Mac from code.visualstudio.com.

This release of VS Code features agents that can build and test web apps in the integrated browser, safer per-site browsing with per-site permissions, and new ways to keep agent sessions organized. Browser tools for agents, which let agents open pages in the integrated browser, read content and console errors, take screenshots, and select, type, and navigate to verify its own work, become generally available with this release. The browser tools are now enabled by default.

Per-site browser permissions in the integrated browser allow pages to use more web APIs including geolocation, camera, microphone, accelerometer, gyroscope, clipboard, and Bluetooth, USB, serial, and HID devices. When a page requests a permission, VS Code prompts the user to allow or deny the request, Microsoft said.

For managing agent sessions, users now can organize the sessions list into groups to keep related sessions together. When a coding agent session has an open pull request, the Agents window now displays a banner directly above the chat input, enabling action on failing checks and displaying incoming feedback. Each banner provides a single action to fix or view the issue without leaving a conversation. Subagent credits also are addressed in VS Code 1.127. When an agent delegates work to a subagent, it can be difficult to know the cost of the delegated work, Microsoft said. To make this more transparent, users now can hover over a subagent section in the chat response to see the AI credits used by that subagent.

VS Code 1.127 also now supports file-based delivery for managed GitHub Copilot settings. Administrators now can deliver managed GitHub Copilot settings from a JSON file on disk, in addition to the native mobile device management channels and the account-based enterprise settings file.

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