New markdown file that is saved on local PC is not rendered correctly

Where does the bug appear (feature/product)?

Cursor IDE

Describe the Bug

If I create a new text file and save it as .md file locally, while connected to the remote host over ssh, the file will not be rendered correctly for the purposes of preview. When I close the file and try to open it from local storage (drive C:) it will not open.

Steps to Reproduce

Connect remotely using ssh to some location or workspace.
Click File > New text file.
Type “# Testing123 ” to create a markdown header
Click File > Save
Click “Show Local” and save with .md extension
The markdown / preview buttons will appear.
The preview button will not work
Close the file and try to open it again using File > Open (show local, etc.)
The file will not open

Expected Behavior

Preview should work and local file should open

Operating System

Windows 10/11

Version Information

Version: 3.2.11 (user setup)
VSCode Version: 1.105.1
Commit: e9ee1339915a927dfb2df4a836dd9c8337e17cc0
Date: 2026-04-24T14:36:47.933Z
Layout: editor
Build Type: Stable
Release Track: Default
Electron: 39.8.1
Chromium: 142.0.7444.265
Node.js: 22.22.1
V8: 14.2.231.22-electron.0
OS: Windows_NT x64 10.0.26100

Does this stop you from using Cursor

No - Cursor works, but with this issue

Thanks for the report! Can you have a look at this thread to see if it’s the same issue? There’s also a workaround to try!

That appears to be the same issue and the workaround seems to work.
Will this be fixed at some point?

We did not have a bug filed it before, now we do! Thanks for reporting.