Visual Studio Code Adds AI Chat Cost Tracking and Multi-Chat Copilot Sessions

Microsoft has released Visual Studio Code 1.126, just one week after shipping version 1.125. The latest update focuses on improving GitHub Copilot workflows, giving developers better visibility into AI usage costs, and making it safer to inspect unfamiliar code.

The release introduces three notable changes: session-level AI cost tracking, support for multiple chats within a single Copilot agent session, and a streamlined approach to opening untrusted folders in Restricted Mode. Microsoft says these improvements aim to make AI-assisted development more transparent, flexible, and secure.

VS Code now shows the total cost of AI chat sessions

One of the biggest additions in Visual Studio Code 1.126 is session-level chat cost tracking.

Previously, developers could mainly see the cost of individual chat turns. With the new update, VS Code displays the total cost accumulated across an entire chat session, making it easier to understand how many AI credits a conversation has consumed.

Microsoft says the feature gives users greater transparency over GitHub Copilot usage and helps identify conversations that consume more credits than expected. The change builds on Microsoft’s recent efforts to provide better visibility into AI usage and billing inside the editor.

Multiple chats can now run in the same Copilot agent session

The update also expands the capabilities of the Agents window.

A Copilot agent session can now contain multiple chat conversations simultaneously. Users can start another conversation by selecting the New Chat (+) button in the session toolbar without creating an entirely new agent session.

Each chat maintains its own conversation history, allowing developers to switch between different tasks without losing context.

For example, one chat can continue generating code while another reviews recent changes, writes unit tests, or drafts documentation.

Opening untrusted folders becomes safer

Microsoft has also updated how Visual Studio Code handles untrusted folders.

Instead of displaying a pop-up asking whether users trust a folder, VS Code now opens newly discovered folders directly in Restricted Mode.

A banner appears at the top of the editor, allowing users to change the trust status if they decide the folder is safe.

The update is available now for Windows, macOS, and Linux through the Visual Studio Code update channel.

In related Microsoft developer news, GitHub recently made Copilot Auto the default experience for Free and Student users, removing manual AI model selection. Microsoft has also introduced the GitHub Copilot desktop app, bringing AI-assisted coding workflows outside the browser.