Saturday, January 17, 2026

Visual Studio Code Introduces New Extension for Agent Development

Microsoft has launched a new Copilot Studio extension for Visual Studio Code, enabling developers to create and manage AI agents seamlessly within their preferred coding environment. Available since January 14 on the Visual Studio Marketplace, this extension allows developers to access essential features like source control, IntelliSense code suggestions, and authoring capabilities for Copilot Studio components.

This innovative tool enhances the development process by incorporating standard practices such as versioning, pull requests, and change history, ensuring efficient collaboration without sacrificing governance. Developers can leverage AI assistance from GitHub Copilot, Claude Code, or other VS Code tools to draft topics, update tools, and troubleshoot agent definitions. By integrating a familiar workflow and key VS Code ergonomics—including keyboard shortcuts and a local dev loop—Microsoft aims to empower developers to build, refine, and iterate on their Copilot Studio agents effectively. This extension optimizes productivity while maintaining oversight and collaboration, making it a valuable asset for AI development.

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