VS Code 1.126: session-level cost, multi-chat sessions, Restricted Mode

On June 24, 2026, Microsoft released Visual Studio Code 1.126, focused on AI cost transparency, simpler model tuning and safer code browsing.

Key points

• Session-level cost: see the total credit cost of an entire chat session, not just per turn, making expensive conversations easy to spot.
• Unified model picker: context size and reasoning (thinking) effort controls are combined into a single customization picker instead of two dropdowns; the model hover is simplified with a one-word capability descriptor.
• Multiple chats per session: in the Agents window, a Copilot session can hold several chats at once, sharing working context and persisting across window reloads.
• Workspace safety: new folders now open in Restricted Mode (showing only a trust banner) rather than prompting immediately; the easy-to-misclick "Trust Parent" button is removed. The security.workspace.trust.startupPrompt default changes from once to never.
• Docs: agentic documentation is regrouped under a single "Agents" section, with languages and extensions moved under "Languages and Runtimes" and "Extension Docs".