Hello ivoruss ,
Thank you for the detailed write-up, and for clearly outlining the difference in behavior between the 5.6.x and 2026.x extensions.
You are correct: starting with the 2026.x extension, scripts are served through VS Code's Virtual File System rather than being written to the local temp folder (%LocalAppData%\Temp.universal.code.script). This was an intentional architectural change, and the previous temp-file caching, along with the older "Local Editing" option, is no longer present.
Below are detailed answers and step-by-step guidance for each of your three questions.
Re-enabling a local temp path
There is currently no setting in the 2026.x extension that restores writing scripts to a local temp directory.
That folder was an internal cache tied to the previous editing model, which the Virtual File System replaced. You do not need that cache, however, because PowerShell Universal already keeps your scripts as real files on disk in its repository folder, which the patterns below use directly.
Recommended integration pattern for external/AI tools
First, locate your repository folder:
Step 1: Open your appsettings.json (default: C:\ProgramData\PowerShellUniversal\appsettings.json).
Step 2: In the Data section, find RepositoryPath. By default this resolves to %ProgramData%\UniversalAutomation\Repository.
Step 3: That folder holds your scripts as plain .ps1 files, plus a .universal subfolder with the configuration (scripts.ps1, dashboards.ps1, and so on). This folder, not the extension's virtual workspace, is the on-disk surface external tools should target.
Option A - Git two-way sync (recommended for the "edit locally, run on DEV" workflow):
Step 1: Create an empty repository on your Git provider (GitHub, GitLab, Azure DevOps, etc.).
Step 2: In the admin console, open Settings, then Git, and click Create Git Settings. Enter:
Remote (GitRemote): your repository URL
Branch (GitBranch): defaults to master
Username and Password (GitUserName / GitPassword): typically a personal access token
Sync Behavior (GitSyncBehavior): Two Way
Optionally, Sync Interval (GitSyncInterval): defaults to 60 seconds Note: settings changed in the admin console do not update appsettings.json, and vice versa, so configure Git in one place.
Step 3: PowerShell Universal performs an initial sync and commits the current repository contents to the remote.
Step 4: On your workstation, clone the repository: git clone <remote-url>
Step 5: Open the clone in VS Code and point your AI tool at that folder. The scripts are ordinary files it can discover, read, and edit.
Step 6: When you are ready to test on DEV, stage and push: git add -A git commit -m "Update scripts" git push
Step 7: The server pulls on the sync interval, or immediately when you click Synchronize Now in Settings, then Git. Please note an important documented behavior: configurations do not reload automatically after a pull. The sync reloads only the files changed in the commit, and if a change is not reflected you may need to force a reload (restarting the PowerShell Universal service is a reliable way to do this).
Option B - Direct repository editing (only when PowerShell Universal runs locally, under the same account as your editor):
Step 1: Check the service identity in Services (PowerShell Universal, Log On tab). If it runs as LocalSystem or a dedicated service account, the repository files are typically read-only to your interactive user, and Option A is the better choice.
Step 2: If it runs under your own account (or you have explicitly granted your account Modify rights on the repository folder, understanding the security implications), open the repository folder directly in VS Code.
Step 3: Edit the .ps1 files and save. Be aware that changes made on disk are not always reloaded automatically; if a change is not picked up, force a reload or use the Git workflow in Option A.
For most remote DEV scenarios, Option A (Git) is the cleanest and avoids the file-permission considerations entirely.
Mirroring the Virtual File System to a configurable local directory
This is a reasonable enhancement request, and I have shared it with our product team for consideration. I cannot commit to a timeline, but the feedback is recorded. In the meantime, the repository folder combined with Git two-way sync (Option A above) provides the same "real files on disk" capability that your external tools rely on.
Relevant documentation:
VS Code extension: https://docs.powershelluniversal.com/development/visual-studio-code-extension
Repository: https://docs.powershelluniversal.com/config/repository
Git integration: https://docs.powershelluniversal.com/config/git
If you would like, let me know your DEV setup (whether the server runs locally or remotely, and under which account), and I can tailor the exact steps to your environment.
Best regards,
Special Q&A