Create folder during init

cli/azd/extensions/azure.ai.agents/internal/cmd/init.go

@@ -10,6 +10,7 @@ import (
 	"errors"
 	"fmt"
 	"io"
+	"io/fs"
 	"log"
 	"maps"
 	"net/http"
@@ -507,9 +508,10 @@ func runInitFromManifest(
 	flags *initFlags,
 	azdClient *azdext.AzdClient,
 	httpClient *http.Client,
+	targetDir string,
 ) error {
 	// Ensure project and environment exist (no subscription/location prompting yet)
-	projectConfig, err := ensureProject(ctx, flags, azdClient)
+	projectConfig, err := ensureProject(ctx, flags, azdClient, targetDir)
 	if err != nil {
 		return err
 	}
@@ -642,6 +644,20 @@ from code-deploy ZIP packaging (uses .gitignore syntax).`,
 				Timeout: 30 * time.Second,
 			}
 
+			// Capture the original working directory so we can print an
+			// accurate cd hint after the process has chdir'd.
+			originalCwd, err := os.Getwd()
+			if err != nil {
+				return fmt.Errorf("getting current directory: %w", err)
+			}
+
+			// Track the absolute path of a newly created project folder so we
+			// can print a follow-up cd hint at the end of the command.
+			createdFolder := ""
+			// Original template title, used to surface a notice when the
+			// sanitized folder name differs significantly from what the user selected.
+			createdFromTitle := ""
+
 			// Auto-detect an existing agent manifest in the target directory
 			// when no --manifest flag was provided.
 			if flags.manifestPointer == "" {
@@ -689,7 +705,7 @@ from code-deploy ZIP packaging (uses .gitignore syntax).`,
 					return err
 				}
 
-				if err := runInitFromManifest(ctx, flags, azdClient, httpClient); err != nil {
+				if err := runInitFromManifest(ctx, flags, azdClient, httpClient, "."); err != nil {
 					if exterrors.IsCancellation(err) {
 						return exterrors.Cancelled("initialization was cancelled")
 					}
@@ -719,17 +735,24 @@ from code-deploy ZIP packaging (uses .gitignore syntax).`,
 					switch selectedTemplate.EffectiveType() {
 					case TemplateTypeAzd:
 						// Full azd template - dispatch azd init -t <repo>
-						initArgs := []string{"init", "-t", selectedTemplate.Source, "."}
+						// Create project in a new subdirectory derived from the template title.
+						folderName := folderNameStrippingParenSuffix(selectedTemplate.Title)
+						// Check whether the target directory already exists so we
+						// only report "created" when a new directory was made.
+						_, statErr := os.Stat(folderName)
+						newlyCreated := errors.Is(statErr, fs.ErrNotExist)
+						initArgs := []string{"init", "-t", selectedTemplate.Source, folderName}
 						if flags.env != "" {
 							initArgs = append(initArgs, "--environment", flags.env)
 						} else {
-							cwd, err := os.Getwd()
-							if err == nil {
-								sanitizedDirectoryName := sanitizeAgentName(filepath.Base(cwd))
-								initArgs = append(
-									initArgs, "--environment", sanitizedDirectoryName+"-dev",
-								)
+							base := sanitizeAgentName(folderName)
+							if len(base) > 59 {
+								base = strings.TrimRight(base[:59], "-")
 							}
+							defaultEnvName := base + "-dev"
+							initArgs = append(
+								initArgs, "--environment", defaultEnvName,
+							)
 						}
 
 						workflow := &azdext.Workflow{
@@ -760,6 +783,19 @@ from code-deploy ZIP packaging (uses .gitignore syntax).`,
 							selectedTemplate.Title,
 						)
 
+						// Sync the extension process into the new project directory.
+						// The azd host already chdir'd when it processed the init command.
+						if err := os.Chdir(folderName); err != nil {
+							return fmt.Errorf(
+								"changing to project directory %q: %w",
+								folderName, err,
+							)
+						}
+						if newlyCreated {
+							createdFolder = filepath.Join(originalCwd, folderName)
+							createdFromTitle = selectedTemplate.Title
+						}
+
 						// Search for an agent manifest in the scaffolded project
 						cwd, err := os.Getwd()
 						if err != nil {
@@ -773,7 +809,7 @@ from code-deploy ZIP packaging (uses .gitignore syntax).`,
 
 						if manifestPath != "" {
 							flags.manifestPointer = manifestPath
-							if err := runInitFromManifest(ctx, flags, azdClient, httpClient); err != nil {
+							if err := runInitFromManifest(ctx, flags, azdClient, httpClient, "."); err != nil {
 								if exterrors.IsCancellation(err) {
 									return exterrors.Cancelled("initialization was cancelled")
 								}
@@ -784,14 +820,26 @@ from code-deploy ZIP packaging (uses .gitignore syntax).`,
 						}
 
 					default:
-						// Agent manifest template - use existing -m flow
+						// Agent manifest template - use existing -m flow.
+						// Create project in a new subdirectory derived from the template title.
+						folderName := folderNameStrippingParenSuffix(selectedTemplate.Title)
+						// Check whether the target directory already exists so we
+						// only report "created" when a new directory was made.
+						_, statErr := os.Stat(folderName)
+						newlyCreated := errors.Is(statErr, fs.ErrNotExist)
 						flags.manifestPointer = selectedTemplate.Source
-						if err := runInitFromManifest(ctx, flags, azdClient, httpClient); err != nil {
+						if err := runInitFromManifest(
+							ctx, flags, azdClient, httpClient, folderName,
+						); err != nil {
 							if exterrors.IsCancellation(err) {
 								return exterrors.Cancelled("initialization was cancelled")
 							}
 							return err
 						}
+						if newlyCreated {
+							createdFolder = filepath.Join(originalCwd, folderName)
+							createdFromTitle = selectedTemplate.Title
+						}
 					}
 
 				default:
@@ -811,6 +859,10 @@ from code-deploy ZIP packaging (uses .gitignore syntax).`,
 				}
 			}
 
+			if createdFolder != "" {
+				fmt.Print(formatCreatedFolderMessage(originalCwd, createdFolder, createdFromTitle))
+			}
+
 			return nil
 		},
 	}
@@ -994,21 +1046,37 @@ func (a *InitAction) Run(ctx context.Context) error {
 	return nil
 }
 
-func ensureProject(ctx context.Context, flags *initFlags, azdClient *azdext.AzdClient) (*azdext.ProjectConfig, error) {
+func ensureProject(
+	ctx context.Context,
+	flags *initFlags,
+	azdClient *azdext.AzdClient,
+	targetDir string,
+) (*azdext.ProjectConfig, error) {
 	projectResponse, err := azdClient.Project().Get(ctx, &azdext.EmptyRequest{})
 	if err != nil {
 		fmt.Println("Let's get your project initialized.")
 
 		// Environment creation is handled separately in ensureEnvironment
-		initArgs := []string{"init", "-t", "Azure-Samples/azd-ai-starter-basic", "."}
+		initArgs := []string{
+			"init", "-t", "Azure-Samples/azd-ai-starter-basic", targetDir,
+		}
 		if flags.env != "" {
 			initArgs = append(initArgs, "--environment", flags.env)
 		} else {
-			cwd, err := os.Getwd()
-			if err == nil {
-				sanitizedDirectoryName := sanitizeAgentName(filepath.Base(cwd))
-				initArgs = append(initArgs, "--environment", sanitizedDirectoryName+"-dev")
+			// Derive environment name from target folder
+			envBase := targetDir
+			if targetDir == "." {
+				cwd, cwdErr := os.Getwd()
+				if cwdErr == nil {
+					envBase = filepath.Base(cwd)
+				}
 			}
+			base := sanitizeAgentName(envBase)
+			if len(base) > 59 {
+				base = strings.TrimRight(base[:59], "-")
+			}
+			envName := base + "-dev"
+			initArgs = append(initArgs, "--environment", envName)
 		}
 
 		// We don't have a project yet
@@ -1035,6 +1103,17 @@ func ensureProject(ctx context.Context, flags *initFlags, azdClient *azdext.AzdC
 			)
 		}
 
+		// Sync the extension process into the new project directory so that
+		// subsequent local file operations see the scaffolded project.
+		if targetDir != "." {
+			if chdirErr := os.Chdir(targetDir); chdirErr != nil {
+				return nil, fmt.Errorf(
+					"changing to project directory %q: %w",
+					targetDir, chdirErr,
+				)
+			}
+		}
+
 		projectResponse, err = azdClient.Project().Get(ctx, &azdext.EmptyRequest{})
 		if err != nil {
 			return nil, exterrors.Dependency(
@@ -2908,3 +2987,21 @@ func extractConnectionConfigs(
 
 	return connections, credentialEnvVars, nil
 }
+
+// formatCreatedFolderMessage builds the user-facing message shown after a new
+// project folder is created. It computes a cross-platform relative display path
+// and optionally notes the original template title when the folder name differs.
+func formatCreatedFolderMessage(originalCwd, createdFolder, createdFromTitle string) string {
+	displayPath := createdFolder
+	if relPath, err := filepath.Rel(originalCwd, createdFolder); err == nil {
+		displayPath = filepath.ToSlash(relPath)
+	}
+
+	msg := fmt.Sprintf("\nYour project has been created in %s", displayPath)
+	if createdFromTitle != "" && filepath.Base(createdFolder) != createdFromTitle {
+		msg += fmt.Sprintf(" (from template %q)", createdFromTitle)
+	}
+	msg += fmt.Sprintf("\n  cd %s\n", displayPath)
+
+	return msg
+}

cli/azd/extensions/azure.ai.agents/internal/cmd/init_from_code.go

@@ -812,6 +812,13 @@ func sanitizeAgentName(name string) string {
 	return name
 }
 
+func folderNameStrippingParenSuffix(title string) string {
+	if idx := strings.IndexByte(title, '('); idx >= 0 {
+		title = strings.TrimSpace(title[:idx])
+	}
+	return sanitizeAgentName(title)
+}
+
 // normalizeForFuzzyMatch strips common separator characters (hyphens, dots, spaces, underscores)
 // and lowercases the string for fuzzy comparison.
 func normalizeForFuzzyMatch(s string) string {

cli/azd/extensions/azure.ai.agents/internal/cmd/init_from_code_test.go

@@ -100,6 +100,16 @@ func TestSanitizeAgentName(t *testing.T) {
 			input:    "---",
 			expected: "my-agent",
 		},
+		{
+			name:     "non-ASCII characters stripped",
+			input:    "Ünö Ägent",
+			expected: "n-gent",
+		},
+		{
+			name:     "all non-ASCII falls back to default",
+			input:    "日本語エージェント",
+			expected: "my-agent",
+		},
 	}
 
 	for _, tt := range tests {