diff --git a/pnpm-lock.yaml b/pnpm-lock.yaml
index b8ca01240be..11b30f871a1 100644
--- a/pnpm-lock.yaml
+++ b/pnpm-lock.yaml
@@ -1057,8 +1057,8 @@ importers:
         specifier: ^5.0.5
         version: 5.0.5
       '@types/vscode':
-        specifier: ^1.84.0
-        version: 1.100.0
+        specifier: ^1.106.0
+        version: 1.108.1
       '@vscode/test-electron':
         specifier: ^2.5.2
         version: 2.5.2
@@ -4429,6 +4429,9 @@ packages:
   '@types/vscode@1.103.0':
     resolution: {integrity: sha512-o4hanZAQdNfsKecexq9L3eHICd0AAvdbLk6hA60UzGXbGH/q8b/9xv2RgR7vV3ZcHuyKVq7b37IGd/+gM4Tu+Q==}
 
+  '@types/vscode@1.108.1':
+    resolution: {integrity: sha512-DerV0BbSzt87TbrqmZ7lRDIYaMiqvP8tmJTzW2p49ZBVtGUnGAu2RGQd1Wv4XMzEVUpaHbsemVM5nfuQJj7H6w==}
+
   '@types/ws@8.18.1':
     resolution: {integrity: sha512-ThVF6DCVhA8kUGy+aazFQ4kXQ7E1Ty7A3ypFOe0IcJV8O/M511G99AW24irKrW56Wt44yG9+ij8FaqoBGkuBXg==}
 
@@ -14438,6 +14441,8 @@ snapshots:
 
   '@types/vscode@1.103.0': {}
 
+  '@types/vscode@1.108.1': {}
+
   '@types/ws@8.18.1':
     dependencies:
       '@types/node': 24.2.1
diff --git a/src/api/providers/__tests__/vscode-lm.spec.ts b/src/api/providers/__tests__/vscode-lm.spec.ts
index 305305d2289..a16bb1dd27f 100644
--- a/src/api/providers/__tests__/vscode-lm.spec.ts
+++ b/src/api/providers/__tests__/vscode-lm.spec.ts
@@ -1,4 +1,5 @@
 import type { Mock } from "vitest"
+import { checkModelSupportsImages, IMAGE_CAPABLE_MODEL_PREFIXES } from "../vscode-lm"
 
 // Mocks must come first, before imports
 vi.mock("vscode", () => {
@@ -537,3 +538,92 @@ describe("VsCodeLmHandler", () => {
 		})
 	})
 })
+
+describe("checkModelSupportsImages", () => {
+	describe("OpenAI GPT models", () => {
+		it("should return true for all gpt-* models (GitHub Copilot)", () => {
+			// All GPT models in GitHub Copilot support images
+			expect(checkModelSupportsImages("gpt", "gpt-4o")).toBe(true)
+			expect(checkModelSupportsImages("gpt", "gpt-4.1")).toBe(true)
+			expect(checkModelSupportsImages("gpt", "gpt-5")).toBe(true)
+			expect(checkModelSupportsImages("gpt", "gpt-5.1")).toBe(true)
+			expect(checkModelSupportsImages("gpt", "gpt-5.2")).toBe(true)
+			expect(checkModelSupportsImages("gpt-mini", "gpt-5-mini")).toBe(true)
+			expect(checkModelSupportsImages("gpt-codex", "gpt-5.1-codex")).toBe(true)
+			expect(checkModelSupportsImages("gpt-codex", "gpt-5.2-codex")).toBe(true)
+			expect(checkModelSupportsImages("gpt-codex", "gpt-5.1-codex-max")).toBe(true)
+			expect(checkModelSupportsImages("gpt-codex", "gpt-5.1-codex-mini")).toBe(true)
+		})
+
+		it("should return true for o1 and o3 reasoning models", () => {
+			expect(checkModelSupportsImages("o1", "o1-preview")).toBe(true)
+			expect(checkModelSupportsImages("o1", "o1-mini")).toBe(true)
+			expect(checkModelSupportsImages("o3", "o3")).toBe(true)
+		})
+	})
+
+	describe("Anthropic Claude models", () => {
+		it("should return true for all claude-* models (GitHub Copilot)", () => {
+			// All Claude models in GitHub Copilot support images
+			expect(checkModelSupportsImages("claude-haiku", "claude-haiku-4.5")).toBe(true)
+			expect(checkModelSupportsImages("claude-opus", "claude-opus-4.5")).toBe(true)
+			expect(checkModelSupportsImages("claude-sonnet", "claude-sonnet-4")).toBe(true)
+			expect(checkModelSupportsImages("claude-sonnet", "claude-sonnet-4.5")).toBe(true)
+		})
+	})
+
+	describe("Google Gemini models", () => {
+		it("should return true for all gemini-* models (GitHub Copilot)", () => {
+			// All Gemini models in GitHub Copilot support images
+			expect(checkModelSupportsImages("gemini-pro", "gemini-2.5-pro")).toBe(true)
+			expect(checkModelSupportsImages("gemini-flash", "gemini-3-flash-preview")).toBe(true)
+			expect(checkModelSupportsImages("gemini-pro", "gemini-3-pro-preview")).toBe(true)
+		})
+	})
+
+	describe("non-vision models", () => {
+		it("should return false for grok models (text-only in GitHub Copilot)", () => {
+			// Grok is the only model family in GitHub Copilot that doesn't support images
+			expect(checkModelSupportsImages("grok", "grok-code-fast-1")).toBe(false)
+		})
+
+		it("should return false for models with non-matching prefixes", () => {
+			// Models that don't start with gpt, claude, gemini, o1, or o3
+			expect(checkModelSupportsImages("mistral", "mistral-large")).toBe(false)
+			expect(checkModelSupportsImages("llama", "llama-3-70b")).toBe(false)
+			expect(checkModelSupportsImages("unknown", "some-random-model")).toBe(false)
+		})
+	})
+
+	describe("case insensitivity", () => {
+		it("should match regardless of case", () => {
+			expect(checkModelSupportsImages("GPT", "GPT-4O")).toBe(true)
+			expect(checkModelSupportsImages("CLAUDE", "CLAUDE-SONNET-4")).toBe(true)
+			expect(checkModelSupportsImages("GEMINI", "GEMINI-2.5-PRO")).toBe(true)
+		})
+	})
+
+	describe("prefix matching", () => {
+		it("should only match IDs that start with known prefixes", () => {
+			// ID must START with the prefix, not just contain it
+			expect(checkModelSupportsImages("custom", "gpt-4o")).toBe(true) // ID starts with gpt
+			expect(checkModelSupportsImages("custom", "my-gpt-model")).toBe(false) // gpt not at start
+			expect(checkModelSupportsImages("custom", "not-claude-model")).toBe(false) // claude not at start
+		})
+	})
+})
+
+describe("IMAGE_CAPABLE_MODEL_PREFIXES", () => {
+	it("should export the model prefixes array", () => {
+		expect(Array.isArray(IMAGE_CAPABLE_MODEL_PREFIXES)).toBe(true)
+		expect(IMAGE_CAPABLE_MODEL_PREFIXES.length).toBeGreaterThan(0)
+	})
+
+	it("should include key model prefixes", () => {
+		expect(IMAGE_CAPABLE_MODEL_PREFIXES).toContain("gpt")
+		expect(IMAGE_CAPABLE_MODEL_PREFIXES).toContain("claude")
+		expect(IMAGE_CAPABLE_MODEL_PREFIXES).toContain("gemini")
+		expect(IMAGE_CAPABLE_MODEL_PREFIXES).toContain("o1")
+		expect(IMAGE_CAPABLE_MODEL_PREFIXES).toContain("o3")
+	})
+})
diff --git a/src/api/providers/vscode-lm.ts b/src/api/providers/vscode-lm.ts
index 8fb564a9d59..953a4fe84c2 100644
--- a/src/api/providers/vscode-lm.ts
+++ b/src/api/providers/vscode-lm.ts
@@ -529,6 +529,10 @@ export class VsCodeLmHandler extends BaseProvider implements SingleCompletionHan
 
 			const modelId = this.client.id || modelParts.join(SELECTOR_SEPARATOR)
 
+			// Check if the model supports images based on known model families
+			// VS Code Language Model API 1.106+ supports image inputs via LanguageModelDataPart
+			const supportsImages = checkModelSupportsImages(this.client.family, this.client.id)
+
 			// Build model info with conservative defaults for missing values
 			const modelInfo: ModelInfo = {
 				maxTokens: -1, // Unlimited tokens by default
@@ -536,7 +540,7 @@ export class VsCodeLmHandler extends BaseProvider implements SingleCompletionHan
 					typeof this.client.maxInputTokens === "number"
 						? Math.max(0, this.client.maxInputTokens)
 						: openAiModelInfoSaneDefaults.contextWindow,
-				supportsImages: false, // VSCode Language Model API currently doesn't support image inputs
+				supportsImages,
 				supportsPromptCache: true,
 				inputPrice: 0,
 				outputPrice: 0,
@@ -586,8 +590,43 @@ export class VsCodeLmHandler extends BaseProvider implements SingleCompletionHan
 	}
 }
 
-// Static blacklist of VS Code Language Model IDs that should be excluded from the model list e.g. because they will never work
-const VSCODE_LM_STATIC_BLACKLIST: string[] = ["claude-3.7-sonnet", "claude-3.7-sonnet-thought"]
+/**
+ * Model ID prefixes that support image inputs via VS Code Language Model API.
+ * These models support the LanguageModelDataPart.image() API introduced in VS Code 1.106+.
+ *
+ * All GitHub Copilot models with these prefixes support images.
+ * Only grok-* models don't support images (text only).
+ *
+ * Source: https://models.dev/api.json (github-copilot provider models)
+ */
+export const IMAGE_CAPABLE_MODEL_PREFIXES = [
+	"gpt", // All GPT models (gpt-4o, gpt-4.1, gpt-5, gpt-5.1, gpt-5.2, gpt-5-mini, gpt-5.1-codex, etc.)
+	"claude", // All Claude models (claude-haiku-4.5, claude-opus-4.5, claude-sonnet-4, claude-sonnet-4.5)
+	"gemini", // All Gemini models (gemini-2.5-pro, gemini-3-flash-preview, gemini-3-pro-preview)
+	"o1", // OpenAI o1 reasoning models
+	"o3", // OpenAI o3 reasoning models
+]
+
+/**
+ * Checks if a model supports image inputs based on its model ID.
+ * Uses prefix matching against known image-capable model families.
+ *
+ * @param _family The model family (unused, kept for API compatibility)
+ * @param id The model ID
+ * @returns true if the model supports image inputs
+ */
+export function checkModelSupportsImages(_family: string, id: string): boolean {
+	const idLower = id.toLowerCase()
+	return IMAGE_CAPABLE_MODEL_PREFIXES.some((prefix) => idLower.startsWith(prefix))
+}
+
+// Static blacklist of VS Code Language Model IDs that should be excluded from the model list
+// e.g. because they don't support native tool calling or will never work
+const VSCODE_LM_STATIC_BLACKLIST: string[] = [
+	"claude-3.7-sonnet",
+	"claude-3.7-sonnet-thought",
+	"claude-opus-41", // Does not support native tool calling
+]
 
 export async function getVsCodeLmModels() {
 	try {
diff --git a/src/api/transform/__tests__/vscode-lm-format.spec.ts b/src/api/transform/__tests__/vscode-lm-format.spec.ts
index e60860b5491..edbfaa68b30 100644
--- a/src/api/transform/__tests__/vscode-lm-format.spec.ts
+++ b/src/api/transform/__tests__/vscode-lm-format.spec.ts
@@ -26,7 +26,13 @@ interface MockLanguageModelToolCallPart {
 interface MockLanguageModelToolResultPart {
 	type: "tool_result"
 	callId: string
-	content: MockLanguageModelTextPart[]
+	content: (MockLanguageModelTextPart | MockLanguageModelDataPart)[]
+}
+
+interface MockLanguageModelDataPart {
+	type: "data"
+	data: Uint8Array
+	mimeType: string
 }
 
 // Mock vscode namespace
@@ -54,10 +60,32 @@ vitest.mock("vscode", () => {
 		type = "tool_result"
 		constructor(
 			public callId: string,
-			public content: MockLanguageModelTextPart[],
+			public content: (MockLanguageModelTextPart | MockLanguageModelDataPart)[],
 		) {}
 	}
 
+	class MockLanguageModelDataPart {
+		type = "data"
+		constructor(
+			public data: Uint8Array,
+			public mimeType: string,
+		) {}
+
+		static image(data: Uint8Array, mime: string) {
+			return new MockLanguageModelDataPart(data, mime)
+		}
+
+		static json(value: any, mime?: string) {
+			const bytes = new TextEncoder().encode(JSON.stringify(value))
+			return new MockLanguageModelDataPart(bytes, mime || "application/json")
+		}
+
+		static text(value: string, mime?: string) {
+			const bytes = new TextEncoder().encode(value)
+			return new MockLanguageModelDataPart(bytes, mime || "text/plain")
+		}
+	}
+
 	return {
 		LanguageModelChatMessage: {
 			Assistant: vitest.fn((content) => ({
@@ -75,6 +103,7 @@ vitest.mock("vscode", () => {
 		LanguageModelTextPart: MockLanguageModelTextPart,
 		LanguageModelToolCallPart: MockLanguageModelToolCallPart,
 		LanguageModelToolResultPart: MockLanguageModelToolResultPart,
+		LanguageModelDataPart: MockLanguageModelDataPart,
 	}
 })
 
@@ -150,7 +179,7 @@ describe("convertToVsCodeLmMessages", () => {
 		expect(toolCall.type).toBe("tool_call")
 	})
 
-	it("should handle image blocks with appropriate placeholders", () => {
+	it("should convert image blocks to LanguageModelDataPart", () => {
 		const messages: Anthropic.Messages.MessageParam[] = [
 			{
 				role: "user",
@@ -161,7 +190,7 @@ describe("convertToVsCodeLmMessages", () => {
 						source: {
 							type: "base64",
 							media_type: "image/png",
-							data: "base64data",
+							data: "dGVzdA==", // "test" in base64
 						},
 					},
 				],
@@ -171,8 +200,123 @@ describe("convertToVsCodeLmMessages", () => {
 		const result = convertToVsCodeLmMessages(messages)
 
 		expect(result).toHaveLength(1)
+		expect(result[0].content).toHaveLength(2)
+
+		// First part should be text
+		const textPart = result[0].content[0] as MockLanguageModelTextPart
+		expect(textPart.type).toBe("text")
+		expect(textPart.value).toBe("Look at this:")
+
+		// Second part should be a LanguageModelDataPart for the image
+		const imagePart = result[0].content[1] as unknown as MockLanguageModelDataPart
+		expect(imagePart.type).toBe("data")
+		expect(imagePart.mimeType).toBe("image/png")
+		expect(imagePart.data).toBeInstanceOf(Uint8Array)
+	})
+
+	it("should handle images in tool results", () => {
+		const messages: Anthropic.Messages.MessageParam[] = [
+			{
+				role: "user",
+				content: [
+					{
+						type: "tool_result",
+						tool_use_id: "tool-1",
+						content: [
+							{ type: "text", text: "Screenshot result:" },
+							{
+								type: "image",
+								source: {
+									type: "base64",
+									media_type: "image/jpeg",
+									data: "dGVzdA==",
+								},
+							},
+						],
+					},
+				],
+			},
+		]
+
+		const result = convertToVsCodeLmMessages(messages)
+
+		expect(result).toHaveLength(1)
+		expect(result[0].content).toHaveLength(1)
+
+		const toolResult = result[0].content[0] as MockLanguageModelToolResultPart
+		expect(toolResult.type).toBe("tool_result")
+		expect(toolResult.content).toHaveLength(2)
+
+		// First item in tool result should be text
+		const textPart = toolResult.content[0] as MockLanguageModelTextPart
+		expect(textPart.type).toBe("text")
+
+		// Second item should be image data
+		const imagePart = toolResult.content[1] as MockLanguageModelDataPart
+		expect(imagePart.type).toBe("data")
+		expect(imagePart.mimeType).toBe("image/jpeg")
+	})
+
+	it("should return text placeholder for URL-based images", () => {
+		const messages: Anthropic.Messages.MessageParam[] = [
+			{
+				role: "user",
+				content: [
+					{ type: "text", text: "Check this image:" },
+					{
+						type: "image",
+						source: {
+							type: "url",
+							url: "https://example.com/image.png",
+						} as any,
+					},
+				],
+			},
+		]
+
+		const result = convertToVsCodeLmMessages(messages)
+
+		expect(result).toHaveLength(1)
+		expect(result[0].content).toHaveLength(2)
+
+		// First part should be text
+		const textPart = result[0].content[0] as MockLanguageModelTextPart
+		expect(textPart.type).toBe("text")
+		expect(textPart.value).toBe("Check this image:")
+
+		// Second part should be a text placeholder (not an empty DataPart)
 		const imagePlaceholder = result[0].content[1] as MockLanguageModelTextPart
-		expect(imagePlaceholder.value).toContain("[Image (base64): image/png not supported by VSCode LM API]")
+		expect(imagePlaceholder.type).toBe("text")
+		expect(imagePlaceholder.value).toContain("URL not supported")
+		expect(imagePlaceholder.value).toContain("https://example.com/image.png")
+	})
+
+	it("should return text placeholder for unknown image source types", () => {
+		const messages: Anthropic.Messages.MessageParam[] = [
+			{
+				role: "user",
+				content: [
+					{
+						type: "image",
+						source: {
+							type: "unknown",
+							media_type: "image/png",
+							data: "", // Required by type but ignored for unknown source types
+						} as any,
+					},
+				],
+			},
+		]
+
+		const result = convertToVsCodeLmMessages(messages)
+
+		expect(result).toHaveLength(1)
+		expect(result[0].content).toHaveLength(1)
+
+		// Should return a text placeholder for unknown source types
+		const placeholder = result[0].content[0] as MockLanguageModelTextPart
+		expect(placeholder.type).toBe("text")
+		expect(placeholder.value).toContain("unsupported source type")
 	})
 })
 
diff --git a/src/api/transform/vscode-lm-format.ts b/src/api/transform/vscode-lm-format.ts
index 388197c2c2c..4066b1fdc4a 100644
--- a/src/api/transform/vscode-lm-format.ts
+++ b/src/api/transform/vscode-lm-format.ts
@@ -28,6 +28,46 @@ function asObjectSafe(value: any): object {
 	}
 }
 
+/**
+ * Converts an Anthropic image block to a VS Code LanguageModelDataPart or TextPart.
+ * Uses the new LanguageModelDataPart.image() API available in VS Code 1.106+.
+ * @param imageBlock The Anthropic image block param
+ * @returns A LanguageModelDataPart for the image, or TextPart if the image cannot be converted
+ */
+function convertImageToDataPart(
+	imageBlock: Anthropic.ImageBlockParam,
+): vscode.LanguageModelDataPart | vscode.LanguageModelTextPart {
+	const source = imageBlock.source
+	const mediaType = source.media_type || "image/png"
+
+	if (source.type === "base64") {
+		// Convert base64 string to Uint8Array
+		const binaryString = atob(source.data)
+		const bytes = new Uint8Array(binaryString.length)
+		for (let i = 0; i < binaryString.length; i++) {
+			bytes[i] = binaryString.charCodeAt(i)
+		}
+		return vscode.LanguageModelDataPart.image(bytes, mediaType)
+	} else if (source.type === "url") {
+		// URL-based images cannot be directly converted - return a text placeholder
+		// explaining the limitation. URL images should be fetched and converted to base64 upstream.
+		console.warn(
+			"Roo Code <Language Model API>: URL-based images are not supported by the VS Code LM API. " +
+				"Images must be provided as base64 data.",
+		)
+		return new vscode.LanguageModelTextPart(
+			`[Image from URL not supported: ${(source as any).url || "unknown URL"}. ` +
+				`VS Code LM API requires base64-encoded image data.]`,
+		)
+	}
+
+	// Fallback for unknown source types - return a text placeholder
+	console.warn(`Roo Code <Language Model API>: Unknown image source type: ${(source as any).type}`)
+	return new vscode.LanguageModelTextPart(
+		`[Image with unsupported source type "${(source as any).type}" cannot be displayed]`,
+	)
+}
+
 export function convertToVsCodeLmMessages(
 	anthropicMessages: Anthropic.Messages.MessageParam[],
 ): vscode.LanguageModelChatMessage[] {
@@ -66,15 +106,13 @@ export function convertToVsCodeLmMessages(
 				const contentParts = [
 					// Convert tool messages to ToolResultParts
 					...toolMessages.map((toolMessage) => {
-						// Process tool result content into TextParts
-						const toolContentParts: vscode.LanguageModelTextPart[] =
+						// Process tool result content into TextParts or DataParts
+						const toolContentParts: (vscode.LanguageModelTextPart | vscode.LanguageModelDataPart)[] =
 							typeof toolMessage.content === "string"
 								? [new vscode.LanguageModelTextPart(toolMessage.content)]
 								: (toolMessage.content?.map((part) => {
 										if (part.type === "image") {
-											return new vscode.LanguageModelTextPart(
-												`[Image (${part.source?.type || "Unknown source-type"}): ${part.source?.media_type || "unknown media-type"} not supported by VSCode LM API]`,
-											)
+											return convertImageToDataPart(part)
 										}
 										return new vscode.LanguageModelTextPart(part.text)
 									}) ?? [new vscode.LanguageModelTextPart("")])
@@ -82,12 +120,10 @@ export function convertToVsCodeLmMessages(
 						return new vscode.LanguageModelToolResultPart(toolMessage.tool_use_id, toolContentParts)
 					}),
 
-					// Convert non-tool messages to TextParts after tool messages
+					// Convert non-tool messages to TextParts or DataParts after tool messages
 					...nonToolMessages.map((part) => {
 						if (part.type === "image") {
-							return new vscode.LanguageModelTextPart(
-								`[Image (${part.source?.type || "Unknown source-type"}): ${part.source?.media_type || "unknown media-type"} not supported by VSCode LM API]`,
-							)
+							return convertImageToDataPart(part)
 						}
 						return new vscode.LanguageModelTextPart(part.text)
 					}),
diff --git a/src/package.json b/src/package.json
index bf4a009a946..e2255b83611 100644
--- a/src/package.json
+++ b/src/package.json
@@ -554,7 +554,7 @@
 		"@types/string-similarity": "^4.0.2",
 		"@types/tmp": "^0.2.6",
 		"@types/turndown": "^5.0.5",
-		"@types/vscode": "^1.84.0",
+		"@types/vscode": "^1.106.0",
 		"@vscode/test-electron": "^2.5.2",
 		"@vscode/vsce": "3.3.2",
 		"ai": "^6.0.0",
diff --git a/webview-ui/src/components/ui/hooks/useSelectedModel.ts b/webview-ui/src/components/ui/hooks/useSelectedModel.ts
index 8eac6fa7403..17914b55eeb 100644
--- a/webview-ui/src/components/ui/hooks/useSelectedModel.ts
+++ b/webview-ui/src/components/ui/hooks/useSelectedModel.ts
@@ -312,7 +312,8 @@ function getSelectedModel({
 				: vscodeLlmDefaultModelId
 			const modelFamily = apiConfiguration?.vsCodeLmModelSelector?.family ?? vscodeLlmDefaultModelId
 			const info = vscodeLlmModels[modelFamily as keyof typeof vscodeLlmModels]
-			return { id, info: { ...openAiModelInfoSaneDefaults, ...info, supportsImages: false } } // VSCode LM API currently doesn't support images.
+			// VS Code LM API 1.106+ supports images via LanguageModelDataPart - use model's supportsImages capability
+			return { id, info: { ...openAiModelInfoSaneDefaults, ...info } }
 		}
 		case "cerebras": {
 			const id = apiConfiguration.apiModelId ?? defaultModelId