MCP servers with autoStart:true in mcp.json do not auto-start

[edosulai]

Bug Report

Environment

• VS Code version: Latest (March 2026)
• OS: macOS (Apple Silicon / arm64)
• MCP config location: ~/Library/Application Support/Code/User/mcp.json

Problem

MCP servers configured in the user-level mcp.json file with "autoStart": true do not auto-start when VS Code launches or when a new chat session begins.

Steps to Reproduce

1. Configure MCP servers in ~/Library/Application Support/Code/User/mcp.json with "autoStart": true
2. Set "chat.mcp.autostart": "always" in settings.json
3. Reload / restart VS Code
4. Open a new Copilot chat session

Expected Behavior

MCP servers should auto-start and their tools should be available to Copilot immediately in any chat session.

Actual Behavior

• Servers show as "Stopped" in "MCP: List Servers"
• MCP tools are not available to Copilot agent
• Users must manually start each server via "MCP: List Servers" every time
• The servers work perfectly fine when tested directly via terminal (stdio JSON-RPC handshake succeeds)

Additional Context

• The servers respond correctly to JSON-RPC initialize when tested via terminal
• This defeats the purpose of autoStart: true and chat.mcp.autostart: "always"
• Users expect a "configure once, works everywhere" experience for MCP servers

Workaround

Running the MCP tool binary directly from terminal as a fallback, bypassing the MCP server integration entirely.