2 files changed, 37 insertions, 25 deletions

diff --git a/packages/vscode-ide-companion/src/extension.test.ts b/packages/vscode-ide-companion/src/extension.test.ts
index 2b3db5ac..5a738c2a 100644
--- a/packages/vscode-ide-companion/src/extension.test.ts
+++ b/packages/vscode-ide-companion/src/extension.test.ts
@@ -25,6 +25,7 @@ vi.mock('vscode', () => ({
       close: vi.fn(),
     },
     showTextDocument: vi.fn(),
+    showWorkspaceFolderPick: vi.fn(),
   },
   workspace: {
     workspaceFolders: [],
@@ -80,8 +81,7 @@ describe('activate', () => {
     vi.mocked(context.globalState.get).mockReturnValue(undefined);
     await activate(context);
     expect(showInformationMessageMock).toHaveBeenCalledWith(
-      'Gemini CLI Companion extension successfully installed. Please restart your terminal to enable full IDE integration.',
-      'Re-launch Gemini CLI',
+      'Gemini CLI Companion extension successfully installed.',
     );
   });
 
@@ -99,8 +99,10 @@ describe('activate', () => {
     await activate(context);
     expect(showInformationMessageMock).toHaveBeenCalled();
     await new Promise(process.nextTick); // Wait for the promise to resolve
-    expect(vscode.commands.executeCommand).toHaveBeenCalledWith(
-      'gemini-cli.runGeminiCLI',
-    );
+    const commandCallback = vi
+      .mocked(vscode.commands.registerCommand)
+      .mock.calls.find((call) => call[0] === 'gemini-cli.runGeminiCLI')?.[1];
+
+    expect(commandCallback).toBeDefined();
   });
 });
diff --git a/packages/vscode-ide-companion/src/extension.ts b/packages/vscode-ide-companion/src/extension.ts
index 10aa41f8..a491ac41 100644
--- a/packages/vscode-ide-companion/src/extension.ts
+++ b/packages/vscode-ide-companion/src/extension.ts
@@ -85,21 +85,9 @@ export async function activate(context: vscode.ExtensionContext) {
   }
 
   if (!context.globalState.get(INFO_MESSAGE_SHOWN_KEY)) {
-    void vscode.window
-      .showInformationMessage(
-        'Gemini CLI Companion extension successfully installed. Please restart your terminal to enable full IDE integration.',
-        'Re-launch Gemini CLI',
-      )
-      .then(
-        (selection) => {
-          if (selection === 'Re-launch Gemini CLI') {
-            void vscode.commands.executeCommand('gemini-cli.runGeminiCLI');
-          }
-        },
-        (err) => {
-          log(`Failed to show information message: ${String(err)}`);
-        },
-      );
+    void vscode.window.showInformationMessage(
+      'Gemini CLI Companion extension successfully installed.',
+    );
     context.globalState.update(INFO_MESSAGE_SHOWN_KEY, true);
   }
 
@@ -107,11 +95,33 @@ export async function activate(context: vscode.ExtensionContext) {
     vscode.workspace.onDidChangeWorkspaceFolders(() => {
       updateWorkspacePath(context);
     }),
-    vscode.commands.registerCommand('gemini-cli.runGeminiCLI', () => {
-      const geminiCmd = 'gemini';
-      const terminal = vscode.window.createTerminal(`Gemini CLI`);
-      terminal.show();
-      terminal.sendText(geminiCmd);
+    vscode.commands.registerCommand('gemini-cli.runGeminiCLI', async () => {
+      const workspaceFolders = vscode.workspace.workspaceFolders;
+      if (!workspaceFolders || workspaceFolders.length === 0) {
+        vscode.window.showInformationMessage(
+          'No folder open. Please open a folder to run Gemini CLI.',
+        );
+        return;
+      }
+
+      let selectedFolder: vscode.WorkspaceFolder | undefined;
+      if (workspaceFolders.length === 1) {
+        selectedFolder = workspaceFolders[0];
+      } else {
+        selectedFolder = await vscode.window.showWorkspaceFolderPick({
+          placeHolder: 'Select a folder to run Gemini CLI in',
+        });
+      }
+
+      if (selectedFolder) {
+        const geminiCmd = 'gemini';
+        const terminal = vscode.window.createTerminal({
+          name: `Gemini CLI (${selectedFolder.name})`,
+          cwd: selectedFolder.uri.fsPath,
+        });
+        terminal.show();
+        terminal.sendText(geminiCmd);
+      }
     }),
     vscode.commands.registerCommand('gemini-cli.showNotices', async () => {
       const noticePath = vscode.Uri.joinPath(