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Copilot sandboxing in VS Code primarily isolates terminal commands and the child processes they start. It applies filesystem and network policies to those processes, and it can also cover MCP servers and language servers launched or managed by the Copilot Agent Host when the relevant settings are enabled. It is not a virtual machine, a separate user account, or a replacement for endpoint security.
The effective boundary depends on the Agent Host configuration, the tool or harness being used, the machine that executes the session, credentials and paths deliberately exposed to it, and whether an operation is approved to run outside the sandbox. Understanding those distinctions prevents both overestimating and underestimating what the feature protects.
What Copilot sandboxing covers first
VS Code’s Copilot Agent Host sandbox is a process boundary. Its main job is to constrain operating-system processes used by an agent. In practical terms, that means a command run in the integrated terminal and programs launched by that command inherit the sandbox’s filesystem and network rules.
The boundary is broader than a single shell command when Agent Host server sandboxing is active. MCP servers and language servers that the Agent Host launches or manages can be placed under the same process restrictions. The exact coverage is documented for the default Copilot SDK tool implementation, not automatically for every chat harness or custom terminal integration. See the Agent Host sandboxing guide for the current implementation details.
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| Area | What is controlled | Important qualification |
|---|---|---|
| Terminal processes | Commands and their child processes run with the configured filesystem and network policy. | The policy follows the execution host and the active Agent Host configuration. |
| Agent Host MCP servers | MCP servers launched or managed by Agent Host can inherit sandbox restrictions. | This is separate from locally configured stdio MCP behavior outside Agent Host. |
| Language servers | Agent Host-launched or managed language servers can be sandboxed when the corresponding setting is active. | Coverage depends on the applicable Agent Host setting and implementation. |
| Built-in non-process tools | These do not run inside the terminal process boundary. | They use their own permission and approval checks. |
Sandboxing therefore answers “which resources can a covered process reach?” It does not, by itself, answer “may this tool perform the action?” That second question belongs to approvals and permissions.
Filesystem isolation: read-write, read-only and denied paths
The Agent Host filesystem policy assigns access levels to paths. The documented categories are read-write, read-only and denied. By default, the current working directory receives read-write access, while user-configured path lists can add or restrict locations. The official settings documentation describes how those lists are applied.
Read-write paths
A read-write path lets a covered process inspect existing files and create, modify or remove files within that path, subject to any higher-priority denial. This is the mode an agent normally needs for editing the workspace, generating build output or running tests that write temporary artifacts.
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Read-write access is not a promise that every operation succeeds. Operating-system permissions, file locks, repository hooks, application-level access controls and disk availability still apply. It also does not grant access to unrelated locations that are outside the allowed path.
Read-only paths
Read-only access permits inspection without ordinary file modifications. It is useful for exposing reference material, a dependency cache or a configuration directory that an agent must read but should not change. A command that attempts to write there should fail because of the sandbox policy, even if the process is running as the same user as VS Code.
Denied paths
A denied path is inaccessible to covered processes. The process may receive a permission error, an unavailable-path result or another operating-system-specific failure when it attempts to list, read or write the location. Denial is the strongest filesystem rule in the policy hierarchy.
Conflict precedence
When path entries overlap, the most restrictive applicable rule wins in this order:
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- Denied takes precedence over every other entry.
- Read-only takes precedence over read-write.
- Read-write applies only when no read-only or denied rule covers the path.
For example, granting read-write access to a project directory while denying a secrets subdirectory leaves the project usable but blocks that subdirectory. Adding a broad read-write rule later does not override the narrower denial.
Developer-tool access is a separate decision
Agent Host has a separate developer-tool access setting. Depending on configuration, it can expose tool directories, configuration files, caches, registry tokens and shared build caches. This is not the same as the ordinary workspace path list. A project may therefore be writable while a package cache or credential-bearing directory remains unavailable, or the reverse if developer-tool access has been deliberately enabled.
Review developer-tool access separately whenever you are assessing exposure. A sandbox that protects source files but exposes a token cache can still reveal credentials to a process that is allowed to read that cache.
Network isolation is a separate policy
Filesystem and network permissions are independent controls. Turning on sandboxing does not automatically make an agent offline. In the documented Agent Host defaults, chat.agent.sandbox.network.allowNetwork is true, while chat.agent.sandbox.network.allowLocalNetwork is false. The allowed-domain and denied-domain lists are empty by default. These defaults are described in the Agent Host guide.
Outbound Internet access
With allowNetwork enabled, a covered process can make outbound network requests unless another policy, host control or domain rule blocks the request. An agent could consequently download dependencies, call an API, fetch documentation or send data to an external service. “Sandbox enabled” is not equivalent to “no Internet access.”
Local-network access
allowLocalNetwork controls access to services on the local network. The documented default is false, so access to local-network resources is denied unless the policy is changed. This setting is distinct from ordinary outbound Internet access: allowing a public API does not necessarily allow a printer, internal service or another machine on the LAN.
Allowed and denied domains
Domain lists provide another layer for network destinations. An empty list is not the same as a deny-all list; the effective result also depends on whether general network access is enabled and how the policy interprets configured entries. Use explicit allow or deny rules when a workflow requires a predictable destination set, and verify the current documentation before relying on a particular precedence rule for domain entries.
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Network policy applies to covered processes. A built-in VS Code operation that does not create an operating-system process can have a different permission path, so changing terminal network access does not automatically govern every Copilot capability.
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Terminal commands and descendants
The primary boundary starts with a terminal command executed by the Agent Host. Programs that command launches—compilers, package managers, scripts, test runners and their descendants—inherit the process restrictions. A script cannot evade the policy merely by spawning another child process.
Inheritance also means a seemingly harmless command can have broader impact than its visible executable. A build script may invoke a shell, a plug-in or a downloader; all of those descendants remain relevant to the same filesystem and network policy while they stay within the sandboxed process tree.
Agent Host MCP and language servers
The Agent Host documentation states that MCP and language servers it launches or manages are sandboxed when the corresponding options are active; those options are listed as enabled by default when Agent Host sandboxing is enabled. This can constrain a server’s file reads, writes and network calls just as it constrains a terminal child process.
Do not merge this behavior with the separate feature for locally running stdio MCP servers configured outside Agent Host. That feature has its own platform support and configuration. A server’s label as “MCP” does not, by itself, prove that it is covered by Agent Host’s process sandbox.
Built-in tools that do not start processes
Some Copilot or VS Code tools perform work through built-in APIs rather than by starting an operating-system process. They are outside the terminal process sandbox and instead use their own permission checks. If such a tool can read a file, edit a resource or perform another action, the relevant approval mechanism—not terminal sandboxing—determines whether it may proceed.
Sandboxing versus approvals and permissions
Approvals and sandboxing solve different problems. Approval settings decide whether an action runs automatically or waits for confirmation. Sandboxing limits the resources available to a covered process after it is allowed to run. The distinction is explained in VS Code’s approvals and permissions documentation.
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| Question | Control that answers it | Example |
|---|---|---|
| May this action run without asking me? | Approval or permission policy | Whether a command requires confirmation before execution. |
| Which files can the running process reach? | Filesystem sandbox policy | Workspace read-write, reference directory read-only, secrets directory denied. |
| Which network destinations can it contact? | Network sandbox policy | Public network allowed, local network denied, domain rules applied. |
| Does a non-process built-in tool need authorization? | That tool’s own permission checks | A built-in file operation may still require approval even when terminal sandboxing is enabled. |
An enabled sandbox can continue restricting a terminal command even when the approval level is broad. Conversely, approving a built-in operation does not turn it into a sandboxed terminal process. Treat the two settings as complementary layers rather than substitutes.
What Copilot sandboxing does not isolate
VS Code explicitly warns that “Sandboxing is not a virtual machine or user-account boundary, and it does not replace endpoint security.” The statement appears in VS Code’s trust and safety guidance.
It is not a virtual machine
A sandboxed process still runs on the execution host. It does not boot a separate guest operating system, virtualize every hardware device or guarantee that host-level vulnerabilities are irrelevant. Isolation is implemented through supported process and resource controls, not a complete machine boundary.
It is not a different user account
The process runs under the account used by the host environment. Credentials and permissions that are explicitly made available—such as an exposed token cache, configuration directory or environment variable—can reduce practical isolation. A sandbox does not automatically scrub secrets from the process environment.
It is not endpoint security
Use normal endpoint protections as an additional layer: operating-system updates, malware protection, least-privilege accounts, credential hygiene, repository controls and network monitoring. The sandbox narrows the resources of covered operations; it is not a complete defense against malicious code or a substitute for organizational security policy.
It does not cover an approved outside-sandbox fallback
An agent workflow may request or receive permission to run an operation outside the sandbox. Once execution is moved outside the process boundary, the restrictions described here no longer provide the same protection. Treat such a fallback as a separate risk decision and inspect the command, paths, network destinations and credentials involved before approving it.
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For a local session, the execution host is the computer running VS Code and the Agent Host. For a connected remote Agent Host session, paths, defaults and platform behavior refer to the remote execution host. A path that looks familiar in the editor may therefore map to a different filesystem, account, network location or credential set.
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Before evaluating exposure, identify:
- Which Agent Host or chat harness is executing the operation.
- Whether the session is local or connected to a remote host.
- Which working directory is receiving the default read-write grant.
- Which user-configured read-only and denied paths apply.
- Whether developer-tool access is enabled.
- Whether Agent Host MCP and language-server sandbox options are active.
- Whether a custom terminal override or another harness changes the documented behavior.
The detailed settings in the Agent Host guide apply to the default Copilot SDK tool implementation. They do not establish identical behavior for the Local chat harness or a custom terminal override. Keep that scope in mind when transferring a configuration from one workflow to another.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.A practical way to evaluate a session’s boundary
You can assess a session without assuming that the word “sandbox” describes every tool equally. Use this sequence when reviewing a workspace, debugging a failure or preparing an organization policy.
- Identify the execution host. Record whether the session is local, remote or running through another environment. The host determines which files, credentials and network interfaces are physically in scope.
- Identify the process tree. Determine whether the operation starts a terminal process, an Agent Host MCP server, a language server or no operating-system process at all.
- List filesystem rules. Mark the working directory, explicit read-write paths, read-only paths and denied paths. Resolve overlaps using denied, then read-only, then read-write precedence.
- Check developer-tool access. Look for tool directories, configuration files, caches, registry tokens and shared build caches that may be exposed through the separate developer-tool setting.
- Check network rules. Record the values of
chat.agent.sandbox.network.allowNetworkandchat.agent.sandbox.network.allowLocalNetwork, then review any allowed- or denied-domain lists. - Check approvals. Determine which actions require confirmation and whether an approved fallback can execute outside the sandbox.
- Test the expected boundary safely. Use a disposable file and a harmless, non-sensitive destination to confirm whether a read, write or network request is allowed. Do not test by exposing real credentials or contacting an untrusted service.
This process separates a policy misunderstanding from an ordinary application failure. For example, a package install that cannot reach a registry may be blocked by network policy, while a package install that reaches the registry but cannot write its cache may be blocked by filesystem policy.
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| Symptom | Likely boundary involved | Diagnostic approach |
|---|---|---|
| A command can read the project but cannot edit one subdirectory. | A denied or read-only rule overrides a broader read-write grant. | Compare the subdirectory with the complete path list and apply precedence from most restrictive to least restrictive. |
| A build works locally but fails in an Agent Host session. | The build depends on a cache, tool directory or credential path not exposed to the sandbox. | Review developer-tool access and the remote-versus-local execution host before widening workspace access. |
| Documentation downloads succeed even though sandboxing is enabled. | Outbound network is allowed by the documented default. | Check chat.agent.sandbox.network.allowNetwork and domain rules; do not infer offline operation from the sandbox label. |
| An internal service is unreachable while a public API works. | Local-network access is denied by default. | Check chat.agent.sandbox.network.allowLocalNetwork and the session’s network location. |
| A built-in operation is allowed or denied differently from a terminal command. | The operation is outside the process sandbox. | Use the tool’s own permission and approval settings rather than changing terminal policy. |
| An MCP server behaves differently from a locally configured stdio server. | They are governed by different server and harness paths. | Confirm whether Agent Host launched or managed the server and consult the applicable configuration documentation. |
| A command asks for confirmation despite a permissive sandbox. | Approval policy and resource policy are independent. | Review approvals separately; changing filesystem or network access does not necessarily remove confirmation prompts. |
| A command runs with broader access after an approval. | An outside-sandbox fallback was authorized. | Inspect the approval details and treat the fallback as an unsandboxed operation. |
Platform and version qualifications
The current Agent Host guide lists macOS, Linux/WSL2 and Windows prerequisites and identifies Windows support as experimental. Availability and behavior can change, so check the current platform requirements before documenting a setup or enforcing a team policy.
VS Code 1.141 release notes describe sandboxing as limiting supported agent operations’ access to files and network resources. They also state that locally launched MCP and language servers are sandboxed by default when sandboxing is enabled. See the 1.141 release notes for that version’s wording. Do not assume that a release-note description overrides the settings and scope documented for the current Agent Host implementation.
Organization policies, updates to VS Code, platform differences and changes to a remote host can alter defaults. Pin the version and configuration you are evaluating when a security decision depends on a particular behavior.
Security checklist for teams
- Start with the narrowest filesystem paths needed for the task.
- Use read-only access for reference directories that do not need edits.
- Keep secrets, token stores and unrelated repositories denied unless a documented workflow requires them.
- Review developer-tool access independently from workspace access.
- Disable outbound network access when a task does not need it; otherwise define destination rules appropriate to the workflow.
- Keep local-network access disabled unless an internal service is explicitly required.
- Classify MCP servers and language servers by how they are launched, not merely by their names.
- Apply separate approval rules to built-in non-process tools.
- Be especially cautious with remote sessions because the remote host owns the actual files, credentials and network interfaces.
- Treat any request to run outside the sandbox as a new authorization decision.
- Maintain endpoint security and least-privilege controls; sandboxing is an additional layer.
The bottom line on Copilot sandbox isolation
Copilot sandboxing in VS Code isolates the terminal process tree and, when enabled for Agent Host, the MCP and language servers that Agent Host launches or manages. It applies separate filesystem and network policies: paths can be read-write, read-only or denied, while outbound Internet and local-network access are controlled independently. The documented defaults allow outbound network access and deny local-network access.
Built-in tools that do not start operating-system processes follow their own permission checks. The sandbox is also limited by the execution host, harness, credentials, developer-tool exposure and any approved operation outside the boundary. Use it as a focused process-containment layer—not as a virtual machine, account boundary or replacement for endpoint security.
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