You updated VS Code, glanced at the changelog, and thought, "Cool, more Copilot stuff." Then you closed it and moved on.
But wait — this release is actually worth a proper look. 👀
VS Code 1.118 (released April 29, 2026) is packed with features that genuinely change how you work with AI agents, search your codebase, manage chat history, and even keep your token usage from quietly draining your budget. Whether you're using Copilot daily or just exploring AI-assisted coding, there's something real here for you.
So let's break it down in plain English — no corporate fluff, just the stuff that matters.
What Is VS Code 1.118?
VS Code 1.118 is the latest monthly release of Visual Studio Code — Microsoft's free, open-source code editor that millions of developers use every day.
Each release ships new features, bug fixes, and improvements. This one focuses heavily on the agent experience, which basically means making Copilot smarter, faster, and cheaper to run.
If you're not familiar with agents: think of them as AI that doesn't just answer questions — they act. They write code, run terminal commands, search your files, and loop through tasks until the job is done. This release makes all of that smoother and more efficient.
Why This Release Matters
Here's the honest truth: AI-assisted coding is no longer a gimmick. It's becoming part of the daily workflow for a lot of developers.
But more AI usage means more tokens. More tokens means higher costs — especially now that GitHub announced Copilot is moving to usage-based billing on June 1, 2026.
VS Code 1.118 directly addresses this. The team made serious engineering improvements to reduce how many tokens each request uses, without making Copilot worse. That's a meaningful change for anyone who relies on it.
Beyond cost, this release also:
- Makes it easier to search across massive codebases
- Lets you control Copilot sessions remotely, from your phone
- Helps you revisit your chat history like a dev journal
- Brings TypeScript 7 one step closer to everyone
That's not a small update. That's a solid month of real improvements.
Key Features with Real-Life Examples
🚀 Remote Control for Copilot CLI Sessions
Imagine you kick off a long agent task before lunch. While you're away, it hits a decision point and stops. Previously, you'd have to be back at your machine to continue.
With remote control, you can approve, steer, or check progress from your phone using the GitHub mobile app — while the session keeps running on your machine in the background.
Enable it with the github.copilot.chat.cli.remote.enabled setting and type /remote on in a Copilot CLI chat to get started.
🔍 Semantic Indexing for All Workspaces
Before 1.118, semantic search (which lets Copilot find code by meaning, not just exact words) only worked with GitHub or Azure DevOps repos.
Now it works for any workspace. So if you ask Copilot "where do we handle user authentication?", it can find code with terms like signIn, verifyCredentials, or OAuth token exchange — even if the word "authentication" never appears.
For local projects, it might take a few minutes to build the index initially. But once it's ready, Copilot understands your codebase much better.
💡 GitHub Text Search Across Repos and Orgs
Semantic search is great for fuzzy intent. But sometimes you need an exact match — like finding a specific error message or API name across your entire organization's codebase.
The new githubTextSearch agent tool does a grep-style search across any GitHub repo or organization, giving Copilot a much sharper way to look things up outside your current workspace.
⚡ Massive Token Efficiency Improvements
This is the one that affects your wallet directly. The team rolled out several changes:
- Cache reuse across turns: Over 93% of each request is now served from cache in active agent sessions. For Anthropic models, cached tokens cost roughly 10x less.
- Tool search tool: Instead of loading every possible tool schema on every request, VS Code now loads a small core set and fetches the rest only when needed. This alone saves up to 20% in token usage for Claude Sonnet 4.5+ users.
- Agentic search and execution tools: Powered by smaller, cheaper models that handle specific tasks like codebase exploration and terminal commands. Early results show up to 20% additional token savings.
None of this changes how Copilot behaves — it just makes it cheaper to run.
📋 Chronicle — Your Chat History as a Dev Journal (Experimental)
Ever tried to write a standup report and completely blanked on what you did yesterday?
Chronicle tracks your Copilot chat sessions in a local SQLite database — recording which files you touched, which PRs you referenced, and what you were working on. Then you can ask it things like:
-
/chronicle:standup→ Generates a standup report from the last 24 hours -
/chronicle:tips→ Gives you personalized prompting tips based on your usage -
/chronicle what files did I edit yesterday?→ Free-form natural language queries
Enable it with github.copilot.chat.localIndex.enabled. It's experimental, but genuinely useful.
🛠️ TypeScript 7.0 Beta Support
TypeScript 7 is a full rewrite in native code. The performance difference is wild — VS Code's own build time dropped from 60 seconds to 10 seconds just by switching to TS 7 for type checking.
You can try it today by installing the TypeScript Native preview extension. It's still beta, so it's not for production, but it's worth testing.
🖥️ VS Code Agents App (Insiders)
If you're on VS Code Insiders, the Agents app now integrates more tightly:
- Launch it directly from the title bar
- Access it from the browser at
insiders.vscode.dev/agents(requires a Dev Tunnel) - Use the Claude Agent alongside Copilot and other agents
- Tabs persist across sessions, so your browser doesn't refresh when you switch context
It's still in preview, but it's shaping up into a genuinely useful parallel workflow tool.
Before vs. After: How Token Usage Has Changed
| Area | Before 1.118 | After 1.118 |
|---|---|---|
| Cache reuse per request | Variable | 93%+ in active sessions |
| Tool schema loading | All tools every turn | Core set + on-demand loading |
| Terminal command handling | Main model | Smaller, dedicated execution tool |
| Codebase search | Main model | Smaller, dedicated search tool |
| Estimated token savings | Baseline | Up to ~20-40% in agent workflows |
This doesn't mean Copilot suddenly becomes free — but for heavy users, the cumulative difference will be noticeable.
Best Tips for Getting the Most Out of VS Code 1.118
✅ Do:
- Enable
github.copilot.chat.localIndex.enabledto try Chronicle — your future self will thank you at standup - Run
Build Codebase semantic indexmanually if Copilot seems off on local projects - Try
/remote onin Copilot CLI before leaving your desk for long agent tasks - Install the TypeScript Native preview extension in a non-production project to test TS 7 performance
❌ Don't:
- Expect remote control to work without enabling the
github.copilot.chat.cli.remote.enabledsetting first - Assume TS 7 is production-ready — it's still beta
- Ignore the Chronicle feature just because it's experimental; it's genuinely useful for tracking work
Common Mistakes to Avoid
Skipping experimental features entirely. A lot of the best stuff in 1.118 is behind experimental flags. That's not a warning sign — it's a chance to try genuinely useful features before they're stable. Just use them in non-critical projects first.
Forgetting to build the semantic index. If you're on a local workspace (not GitHub/ADO), Copilot won't have semantic search until the index is ready. Run the build command manually if you want it available right away.
Ignoring the token efficiency changes. If you're on a usage-based plan, these improvements aren't just nice to have — they affect your bill. Make sure you're on Claude Sonnet 4.5+ or GPT-5.4/5.5 to benefit from the tool search savings.
Not checking for updates manually. VS Code 1.118 is rolling out gradually. If you haven't seen it yet, go to Help → Check for Updates to get it right away.
Wrapping Up
VS Code 1.118 is a focused, well-executed release. It doesn't add flashy gimmicks — it makes the AI-assisted workflow more reliable, more efficient, and cheaper to run.
Remote control for CLI sessions, semantic search everywhere, Chronicle for tracking your work, and serious token savings across the board — these are practical improvements that affect your daily workflow.
If you're a developer who uses Copilot regularly, this update is worth enabling the experimental features and exploring properly.
Check for the update, enable Chronicle, test the remote control — and enjoy paying a little less in token costs. 🎉
Want more VS Code breakdowns, dev tools, and web development content? Head over to *hamidrazadev.com** for more practical articles written by a developer, for developers.*
If this post saved you time or taught you something new, share it with your team or drop a comment below — it helps more than you know. 🙌
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