Microsoft releases Visual Studio Code 1.129 with modern UI preview and new agent host

Microsoft released Visual Studio Code 1.129, an update that adds an experimental modern UI preview. The redesign separates panels, editor groups, tabs and toolbars with rounded corners, floating menus and layered card‑like surfaces, while remaining optional and enabled by default only in VS Code Insiders.

The same release introduces a dedicated Agent Host process that isolates AI agents such as GitHub Copilot, Claude and Codex. The new architecture enables session sharing across multiple VS Code windows, provides an experimental docked editor panel for agent‑generated files, and adds an exclamation‑mark prefix for instant terminal commands. Additional enhancements include Bring‑Your‑Own‑Key model support and GitHub Enterprise authentication for the agent host.

A follow‑up patch, VS Code 1.129.1, was issued a week later to address regressions and further stabilize the modern UI and Agent Host changes, ensuring smoother operation across all supported platforms.