Colors not working on Agent Terminal

[sharko]

Where does the bug appear (feature/product)?

Cursor IDE

Describe the Bug

The agent terminal (Composer/AI agent command execution panel) does not render ANSI color escape codes. All output appears as plain monochrome text. The interactive terminal supports colors correctly, but the agent terminal sets TERM=dumb and its output panel renders escape sequences as raw text instead of colored output. This worked in version 2.4.

Steps to Reproduce

1. Open Cursor and start an AI agent chat (Composer)
2. Ask the agent to run a command that produces colored output, e.g. git diff or ls --color=auto
3. Observe that the agent terminal output panel shows no colors – all text is monochrome
4. The agent terminal sets TERM=dumb, and the output panel does not render ANSI escape codes (they appear as raw text like [31m)
5. The same commands in the interactive terminal (bottom panel) display colors correctly

Expected Behavior

The agent terminal output panel should render ANSI color escape codes, similar to the interactive terminal. Commands like git diff, git status, and ls should show colored output. The TERM variable should be set to xterm-256color instead of dumb.

Screenshots / Screen Recordings

Operating System

MacOS

Version Information

Cursor IDE v2.5.26, macOS 26.3

For AI issues: which model did you use?

Claude Opus 4.6

Does this stop you from using Cursor

No - Cursor works, but with this issue

[deanrie]

Hey, thanks for the report. This is a known limitation. The agent terminal intentionally runs in non-interactive mode with TERM=dumb. It works this way because the agent runs commands programmatically, not in a full interactive shell, so ANSI color output isn’t supported in the agent terminal output panel.

The interactive terminal (bottom panel) works fine because it runs a full shell session with TERM=xterm-256color.

A similar issue was reported before: AI Agent Terminal: Non-Interactive zsh Mode

If you need colored output for debugging, please use the interactive terminal for now.

[sharko]

Do you think it will be addressed in cursor anytime? Coz it was working on 2.4.XX release.
Please let me know.