fix: honor disabled proxy support for proxy settings (#1019)

Stop deriving proxy env vars and config from VS Code proxy settings
when http.proxySupport is off, across SSH ProxyCommand and Coder API
HTTP/WebSocket/SSE paths. Inherited proxy env vars are preserved.
Watch http.proxySupport to reconnect streams and prompt SSH reload on
change. Also deprecate coder.proxyBypass in favor of http.noProxy.

Fixes #1017

Author: EhabY

CHANGELOG.md

@@ -5,6 +5,23 @@
      from published versions since it shows up in the VS Code extension changelog
      tab and is confusing to users. Add it back between releases if needed. -->
 
+## Unreleased
+
+> **Breaking:** API requests now respect `http.proxySupport: off`. Previously
+> the extension applied VS Code's proxy settings (`http.proxy`, `http.noProxy`,
+> `coder.proxyBypass`) to API requests even when `http.proxySupport` was `off`.
+> Now `off` ignores those settings and only proxy environment variables are
+> used. If you set those settings and relied on them while proxy support was
+> `off`, either set `http.proxySupport` to `on` to keep using them, or move the
+> values into the `HTTP_PROXY`/`HTTPS_PROXY` (from `http.proxy`) and `NO_PROXY`
+> (from `http.noProxy`/`coder.proxyBypass`) environment variables.
+
+### Fixed
+
+- Honor `http.proxySupport: off` when deriving proxy settings for SSH and API
+  connections, so VS Code's proxy settings are ignored while inherited proxy
+  environment variables still apply.
+
 ## [v1.15.1](https://github.com/coder/vscode-coder/releases/tag/v1.15.1) 2026-06-26
 
 ### Added

package.json

@@ -123,7 +123,8 @@
 					"scope": "machine"
 				},
 				"coder.proxyBypass": {
-					"markdownDescription": "If not set, will inherit from the `no_proxy` or `NO_PROXY` environment variables. `http.proxySupport` must be set to `on` or `off`, otherwise VS Code will override the proxy agent set by the plugin.",
+					"markdownDescription": "If not set, will inherit from the `no_proxy` or `NO_PROXY` environment variables. Has no effect when `http.proxySupport` is set to `off`. With values other than `on`, VS Code will override the proxy agent set by the plugin.",
+					"markdownDeprecationMessage": "Deprecated: prefer `http.noProxy`.",
 					"type": "string",
 					"default": "",
 					"scope": "machine"

src/api/coderApi.ts

@@ -82,6 +82,7 @@ const webSocketConfigSettings = [
 	"coder.tlsCaFile",
 	"coder.tlsAltHost",
 	"http.proxy",
+	"http.proxySupport",
 	"coder.proxyBypass",
 	"http.noProxy",
 	"http.proxyAuthorization",

src/api/utils.ts

@@ -28,8 +28,16 @@ export async function createHttpAgent(
 ): Promise<ProxyAgent> {
 	const insecure = cfg.get<boolean>("coder.insecure", false);
 	const proxyStrictSSL = cfg.get<boolean>("http.proxyStrictSSL", true);
-	const proxyAuthorization = cfg.get<string | null>("http.proxyAuthorization");
-	const httpNoProxy = cfg.get<string[]>("http.noProxy");
+	// "off" ignores VS Code proxy config; inherited env proxies still apply.
+	const proxyEnabled = cfg.get<string>("http.proxySupport") !== "off";
+	const proxySetting = <T>(key: string) =>
+		proxyEnabled ? cfg.get<T>(key) : undefined;
+	const proxyAuthorization = proxySetting<string | null>(
+		"http.proxyAuthorization",
+	);
+	const httpProxy = proxySetting<string | null>("http.proxy");
+	const coderProxyBypass = proxySetting<string | null>("coder.proxyBypass");
+	const httpNoProxy = proxySetting<string[]>("http.noProxy");
 
 	const certFile = expandPath(
 		String(cfg.get("coder.tlsCertFile") ?? "").trim(),
@@ -54,8 +62,8 @@ export async function createHttpAgent(
 		getProxyForUrl: (url: string) => {
 			return getProxyForUrl(
 				url,
-				cfg.get("http.proxy"),
-				cfg.get("coder.proxyBypass"),
+				httpProxy,
+				coderProxyBypass,
 				joinNoProxy(httpNoProxy),
 			);
 		},

src/remote/environment.ts

@@ -19,6 +19,7 @@ export const SSH_PROXY_SETTINGS: ReadonlyArray<{
 	title: string;
 }> = [
 	{ setting: "http.proxy", title: "HTTP Proxy" },
+	{ setting: "http.proxySupport", title: "HTTP Proxy Support" },
 	{ setting: "http.noProxy", title: "HTTP No Proxy" },
 	{ setting: "coder.proxyBypass", title: "Proxy Bypass" },
 ];
@@ -65,6 +66,10 @@ export function applySshEnvironment(
 export function getSshProxyEnvironment(
 	cfg: Pick<WorkspaceConfiguration, "get">,
 ): SshEnvironment {
+	if (cfg.get<string>("http.proxySupport") === "off") {
+		return {};
+	}
+
 	const httpProxy = trimmed(cfg.get<string | null>("http.proxy"));
 	const noProxy =
 		trimmed(cfg.get<string | null>("coder.proxyBypass")) ??

test/mocks/testHelpers.ts

@@ -149,6 +149,25 @@ export class MockConfigurationProvider {
 	}
 }
 
+export type Settings = Record<string, unknown>;
+
+/** Proxy URL for proxy-config tests. */
+export const PROXY_URL = "http://proxy.example.com:8080";
+
+/** A MockConfigurationProvider seeded with the given settings. */
+export function config(settings: Settings = {}): MockConfigurationProvider {
+	const cfg = new MockConfigurationProvider();
+	for (const [key, value] of Object.entries(settings)) {
+		cfg.set(key, value);
+	}
+	return cfg;
+}
+
+/** Settings with http.proxy set. */
+export function withProxy(settings: Settings = {}): Settings {
+	return { "http.proxy": PROXY_URL, ...settings };
+}
+
 /**
  * Mock progress reporter that integrates with vscode.window.withProgress.
  * Use this to control progress reporting behavior and cancellation in tests.

test/unit/api/coderApi.test.ts

@@ -923,25 +923,31 @@ describe("CoderApi", () => {
 			expect(sockets).toHaveLength(1);
 		});
 
-		it("reconnects sockets in DISCONNECTED state when config changes", async () => {
-			mockConfig.set("coder.insecure", false);
-			const { sockets, handlers } = setupAutoOpeningWebSocket();
-			api = createApi(CODER_URL, AXIOS_TOKEN);
-			await api.watchAgentMetadata(AGENT_ID);
-			await tick();
-
-			// Trigger close with unrecoverable code to put socket in DISCONNECTED
-			handlers["close"]?.({ code: 1002, reason: "Protocol error" });
-			await tick();
-
-			mockConfig.set("coder.insecure", true);
-			await new Promise((resolve) =>
-				setTimeout(resolve, CONFIG_CHANGE_DEBOUNCE_MS + 50),
-			);
+		it.each([
+			["coder.insecure", false, true],
+			["http.proxySupport", "on", "off"],
+		])(
+			"reconnects sockets in DISCONNECTED state when %s changes",
+			async (setting, before, after) => {
+				mockConfig.set(setting, before);
+				const { sockets, handlers } = setupAutoOpeningWebSocket();
+				api = createApi(CODER_URL, AXIOS_TOKEN);
+				await api.watchAgentMetadata(AGENT_ID);
+				await tick();
+
+				// Trigger close with unrecoverable code to put socket in DISCONNECTED
+				handlers["close"]?.({ code: 1002, reason: "Protocol error" });
+				await tick();
+
+				mockConfig.set(setting, after);
+				await new Promise((resolve) =>
+					setTimeout(resolve, CONFIG_CHANGE_DEBOUNCE_MS + 50),
+				);
 
-			// Only DISCONNECTED sockets get reconnected by config changes
-			expect(sockets).toHaveLength(2);
-		});
+				// Only DISCONNECTED sockets get reconnected by config changes
+				expect(sockets).toHaveLength(2);
+			},
+		);
 	});
 });