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Local folders are bookmarks to directories on your machine. They provide a named reference that appears in your sources list, with optional documentation via guide.md.
No special setup required. Local folders use the same Read, Write, Glob, and Grep tools that work on any path. The value is organization and documentation.

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When to Use Local Folders

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Configuration

Create a source folder with a config.json:

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Fields

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Optional: Format Hint

You can add a format hint to help your agent understand the folder contents:

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Adding a Local Folder

The easiest way is to ask your agent:
“Add my Desktop folder as a source”
Or create manually:
  1. Create the source folder:
  2. Add config.json with the configuration above
  3. Optionally add guide.md with context about the folder

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guide.md Example

The guide helps your agent understand what’s in the folder and how to use it:

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Explore Mode Permissions

By default, local folders work in Explore mode with the standard read-only bash commands (ls, cat, head, tail, etc.). To customize, add permissions.json:

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Local Folders vs Working Directory

Choose the right approach for your use case:

Working Directory

Your active project. Set once per session. Full tool access for coding, building, and testing.Use for: The project you’re currently working on

Local Folders

Bookmarks to folders you reference occasionally. Named sources with documentation.Use for: Notes, downloads, reference materials
Rule of thumb: Use Working Directory for coding. Use Local Folders for everything else.