Visual Studio Code bolsters Copilot Chat, MCP support

The latest update to Visual Studio Code, Microsoft’s mostly-open-source code editor, brings several new capabilities to GitHub Copilot Chat and puts the finishing touches on support for the Model Context Protocol (MCP). Alongside the VS Code update, Microsoft has open-sourced the GitHub Copilot Chat extension.

Released July 9, Visual Studio Code 1.102, also known as the June 2025 version, can be downloaded for Windows, Linux, and Mac from code.visualstudio.com.

In this release, support for MCP, a protocol that standardizes how applications provide context to large language models, now is generally available. VS Code 1.102 users can leverage authorization, prompts, sampling, and resources. These additions transform MCP from a set of individual tools into a comprehensive standard for AI agent integrations, Microsoft said. Developers can manage and install MCP servers with the MCP view and gallery. MCP servers now are treated as first-class resources in profiles and Settings Sync, similar to user tasks and other profile-specific configurations.

In an effort to make VS Code an open-source AI editor, the GitHub Copilot Chat extension source code now is available on GitHub under an MIT license. The open-sourcing not only allows developers to explore and contribute to the project, but also enables understanding of the implementation of chat modes, custom instructions, and AI integrations, as well as the creation of improved AI tools, Microsoft said. The effort also enables participation in the future of AI-assisted coding, according to the company.

VS Code 1.102 also brings several chat mode improvements. Developers can specify which language model should be used for a chat mode, use custom modes to tailor chat for specific tasks, automatically approve selected terminal commands, and edit and resubmit previous chat requests. Also, the editor for chat modes, prompts, and instruction files now supports completions, validation, and hovers for all supported metadata properties.

Finally, as for the editor experience, VS Code on Windows now supports using the accent color as the window frame border if enabled in Windows settings. The sparkle toggle in the Settings editor has been modified to act as a toggle between the AI and non-AI search results. And a new “Tasks: Rerun All Running Tasks” command allows developers to quickly rerun all currently running tasks. This is useful for workflows involving multiple concurrent tasks, allowing developers to restart them all at once without stopping and rerunning each individually, Microsoft said.