The Claude Code extension puts Claude Code inside VS Code, or Cursor, as a chat panel next to your files, and Anthropic's docs call it the recommended way to use Claude Code in VS Code. You need VS Code 1.94.0 or later and a paid Claude plan or a Claude Console account; there's no API key to paste, you sign in the first time you open the panel.
If you've only used Claude Code in a terminal, the extension is the same engine with a friendlier face. If you've never opened a code editor, keep reading anyway, because the last section is about whether you need this at all.
What the extension adds that the terminal doesn't
The docs list what you get with the graphical panel:
- Review and edit Claude's plans before you accept them. In Plan mode, VS Code opens the plan as a full Markdown document you can comment on line by line.
- See proposed edits as side-by-side diffs, and accept or reject each change separately. That per-change review needs Claude Code version 2.1.275 or later, and a diff with more than 100 changes opens as a whole file instead.
- @-mention files with specific line ranges from your selection, using Option+K on Mac or Alt+K on Windows and Linux.
- Rewind with checkpoints: fork the conversation from a message, rewind the code to that point, or both.
- Open several conversations in separate tabs or windows, and pick up past ones from your history.
It isn't a full copy of the terminal version, and the docs are upfront about the differences:
| Feature | Terminal (CLI) | VS Code extension |
|---|---|---|
| Commands and skills | All | A subset; type a slash to see them |
| MCP server setup | Yes | Yes, through /mcp in the chat panel |
| Checkpoints | Yes | Yes |
| The ! shortcut for shell commands | Yes | No |
| Tab completion | Yes | No |
What you need first
As of October 2026 the docs list two things. VS Code 1.94.0 or later, which you can check under Help, then About. And an Anthropic account: any paid Claude subscription (Pro, Max, Ultra, Team or Enterprise) or a Claude Console account. If your company reaches Claude through a cloud provider such as Amazon Bedrock, there's a separate setup section for that.
You're not tied to VS Code itself. The extension also installs in VS Code forks such as Devin Desktop and Kiro, through the Open VSX Registry. Editors that can't install it can still run Claude Code in their built-in terminal.
Install it in a couple of minutes
- In VS Code, press Cmd+Shift+X on Mac or Ctrl+Shift+X on Windows and Linux to open the Extensions view.
- Search for Claude Code.
- Check the publisher is Anthropic. The docs' install links point to the listing named anthropic.claude-code.
- Click Install.
- If it doesn't appear, restart VS Code or run Developer: Reload Window from the Command Palette.
Step three matters more than it looks. The docs point out that extension marketplaces are third-party software Anthropic doesn't endorse, maintain or audit. Anthropic submits the extension to the Visual Studio Marketplace and the Open VSX Registry, so install the one it publishes and nothing with a similar name.
One version rule saves a lot of confusion later: the extension's version number is the Claude Code version it bundles. If a feature needs Claude Code version 2.1.286, you need version 2.1.286 or later of the extension, which the Extensions view shows.
Open it and sign in
The Spark icon is Claude Code's marker throughout VS Code. There are four ways in:
- Editor Toolbar: the Spark icon top right. It only appears when a file is open, not just a folder.
- Activity Bar: the Spark icon in the left sidebar opens your sessions list and is always visible.
- Command Palette: Cmd+Shift+P or Ctrl+Shift+P, then type Claude Code.
- Status Bar: click Claude Code in the bottom-right corner. This works even with no file open.
The first time you open the panel, a sign-in screen appears. Click Sign in and finish in your browser. Afterwards a Learn Claude Code checklist appears; dismiss it if you like and bring it back later by unchecking Hide Onboarding under Extensions, then Claude Code, in VS Code's settings.
Then look at the permission mode at the bottom of the prompt box. In Manual mode Claude asks before file edits and most shell commands. In Auto or Edit automatically mode it edits most files without asking. Plan mode describes what it'll do and waits for your approval.
Two catches people hit first
The terminal still says claude isn't found. The extension bundles its own private copy of Claude Code for the chat panel, but it doesn't add the claude command to your system. To run claude in VS Code's built-in terminal, you also need the standalone command-line install. Do it once and terminal commands such as claude mcp add and claude --resume work anywhere. The extension and the terminal share the same conversation history, so you can switch between them.
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You set an API key but it still asks you to sign in. If ANTHROPIC_API_KEY is set in your shell and you still see the sign-in prompt, VS Code may not have inherited your shell environment. Launch VS Code from a terminal by typing code followed by a space and a full stop, or simply sign in with your Claude account.
If the Spark icon is missing, the docs suggest opening a file, checking your VS Code version, reloading the window, temporarily disabling other AI extensions such as Cline or Continue, and checking workspace trust, because the extension doesn't work in Restricted Mode.
Should you use it at all?
If you already work in VS Code or Cursor, yes. I'd install it and keep the permission mode on Manual for your first few sessions, so you see every diff before it lands. If you use Cursor and wonder whether you need both, my Claude Code and Cursor comparison covers that.
If you never open a code editor, skip it. You'll get more from Claude Code in the desktop app, which doesn't ask you to learn an editor first, or from the beginner's route through Claude Code.
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Frequently asked questions
Is there a Claude Code extension for VS Code?
Yes. Anthropic publishes a Claude Code extension for VS Code, and its docs call it the recommended way to use Claude Code in VS Code. It also installs in Cursor and other VS Code forks.
Do I need an API key for the Claude Code extension?
No. Any paid Claude subscription or a Claude Console account works, and you sign in with that account the first time you open the panel.
What version of VS Code does the Claude Code extension need?
VS Code 1.94.0 or later, as of October 2026.
Why can't I run claude in the VS Code terminal after installing the extension?
The extension bundles its own copy of Claude Code for the chat panel but doesn't add the claude command to your system. You need the standalone command-line install for the terminal.
Does the Claude Code extension work in Cursor?
Yes. The docs give install links for VS Code and Cursor, and the extension also installs in forks such as Devin Desktop and Kiro through the Open VSX Registry.
