Hey, this is a known bug on our side. The install script for the remote Cursor Server uses base64 -D, which is a macOS-only flag, so it won’t work on Linux or BusyBox. It’s on our radar and the fix is in the backlog, but we don’t have a clear ETA yet.
While it’s being fixed, the only reliable workaround is to roll back to a previous Cursor version where devcontainers still worked fine for you. You can download older builds here: Cursor · Download
Related thread with the same symptom: Remote Containers do not work with Alpine Docker images