Visual Studio Code Team details the March 2025 (v1.99) release, showcasing features like agent mode with AI-assisted coding, unified chat, advanced notebook tools, and major improvements to developer productivity.

Visual Studio Code March 2025 (version 1.99) Release Notes

Overview

The March 2025 update for Visual Studio Code delivers several significant enhancements, focused on AI-powered coding assistance, improved chat interfaces, richer terminal features, and wide-ranging updates to developer and extension tooling. Below are the key highlights from this release.

Key Highlights

Agent Mode General Availability

  • Agent Mode is now stable, letting developers enable autonomous, AI-assisted coding workflows.
  • Enable via the chat.agent.enabled setting, with rollout to all users in progress.
  • Model Context Protocol (MCP) server tools let agent mode interact with external apps, databases, and more for dynamic, context-aware coding.

Model Context Protocol (MCP) Server Support

  • Configure MCP servers in workspace settings or mcp.json, using environment variables for secure configuration.
  • Setup via command palette, with AI-assisted setups supported for servers published to Docker, npm, or PyPI.
  • MCP server integration enables chat mode to run developer tools and fetch web data during code assistance sessions.

AI Coding Tools & Chat Experience

  • Unified Chat View merges ‘Ask’, ‘Edit’, and ‘Agent’ coding conversations into a single UI.
  • Support for switching seamlessly between brainstorming, code edits, and agentic workflows.
  • Enhanced chat with support for user-created prompts, prompt file autocompletion, and advanced search (semantic search with #searchResults tool).
  • ‘Bring Your Own Key’ allows developers to provide API keys for models from Azure, OpenAI, Anthropic, Gemini, and others.
  • AI notebook editing is improved with support for notebook creation, cell-wise editing, and reviewing/undoing AI edits.

Developer Productivity Enhancements

  • Next Edit Suggestions (NES) now generally available for code edits and suggestions.
  • Inline suggestion syntax highlighting is enabled by default, aiding faster code reviews.
  • Tree-sitter based highlighting for CSS and regex in TypeScript (preview).
  • Source control enhancements: improved git reference picker and repository status bar info.
  • Terminal improvements: richer IntelliSense with subcommand suggestions, auto-refresh for new global CLI tools, and improved shell integration.
  • VS Code extensions can now provide language model tools usable in agent mode and get better APIs for attaching images and monitoring task matchers.

Notebooks and Data Science

  • AI-powered editing for Jupyter notebooks is now stable; developers can edit code and markdown cells, insert cells, and manage outputs with AI assistance.
  • Output and errors from notebook cells can be directly referenced in chat, improving context sharing and debugging.

Platform, Enterprise, and Accessibility

  • Enterprise device management support for macOS (alongside Windows).
  • Accessibility improvements in agent mode and chat, including tool invocation notifications for screen readers and auditory signals for AI edits.

Sample Configurations and Commands

  • Enable agent mode:
    • chat.agent.enabled
  • Add MCP server:
    • Call “MCP: Add Server” from command palette.
  • Notebook AI editing:
    • Use chat mode /newNotebook or enable edit mode with chat.edits2.enabled.
  • Terminal improvements:
    • Try new IntelliSense for the code CLI and other shell integrations.

Further Reading

About the Author

This update is brought to you by the Visual Studio Code Team.

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