AI Agent terminal starts in wrong shell ($ prompt) instead of PowerShell (PS>)

Bug Reports
1

Describe the Bug

I’m using Cursor on Windows.
When I open a terminal manually, it starts normally in PowerShell with the PS> prompt.
But when the AI Agent runs something, it opens a different terminal that looks completely wrong — it shows $ instead of PS> and says Active code page: 65001.

Because of that, it doesn’t behave like real PowerShell, and some normal commands don’t work the same way.
I just want the AI Agent to use the same PowerShell terminal that opens when I start it myself.
How can i fix it?

Steps to Reproduce

Open Cursor

Create a terminal manually → works fine (shows PS> prompt)

Ask the AI Agent to run a command

It opens a $ terminal with Active code page: 65001 instead of PowerShell

Operating System

Windows 10/11

Current Cursor Version (Menu → About Cursor → Copy)

Version: 2.0.34 (system setup)
VSCode Version: 1.99.3
Commit: 45fd70f3fe72037444ba35c9e51ce86a1977ac10
Date: 2025-10-29T06:51:29.202Z
Electron: 34.5.8
Chromium: 132.0.6834.210
Node.js: 20.19.1
V8: 13.2.152.41-electron.0
OS: Windows_NT x64 10.0.26100

Does this stop you from using Cursor

No - Cursor works, but with this issue

2

Hey Thanks for the report. This is a known issue with the new Agent terminal on Windows.

Fix: enable the Legacy Terminal Tool setting:

  • Open Cursor settings Ctrl+Shift+J
  • Go to the Agents tab → Inline Editing & Terminal
  • Enable “Legacy Terminal Tool”
  • Press Ctrl+Shift+P → “Terminal: Kill All Terminals”
  • Fully restart Cursor
  • Test your node scripts again

This will make the Agent respect your default terminal profile. After enabling it, the Agent should open PowerShell with the PS> prompt as expected.

Let me know if this fixes the issue.