Microsoft has released VS Code 1.121 with remote AI agents, Mermaid rendering, HTML previews, and terminal optimizations.

Visual Studio Code 1.121 focuses on agent workflows, model configuration, terminal behavior and built-in preview features -- and features another update to Claude Code functionality.

VS Code comes with a feature you could almost call a miracle in modern software development — Remote SSH. As the name suggests, it lets you use VS Code as if you were working locally, while your code ...

VS Code 1.120 brings the Agents window to Stable preview, giving AI agent sessions and customizations a dedicated workspace.