Cowork VM service crashes on startup — VM bundle path mismatch between AppData\Roaming and AppData\Local\Packages
Preflight Checklist
- [x] I have searched existing issues and this hasn't been reported yet
- [x] This is a single bug report (please file separate reports for different bugs)
- [x] I am using the latest version of Claude Code
What's Wrong?
What's Wrong?
Cowork consistently fails to start with:
"VM service not running. The service failed to start."
The CoworkVMService starts and immediately terminates. This has occurred 3+ times as recorded in the Windows System event log (Event ID 7034).
Root Cause Identified
There is a VM bundle path mismatch. Claude downloads and expects VM files in two different locations depending on the operation:
Download path (where files are saved):
C:\Users\<username>\AppData\Roaming\Claude\vm_bundles\claudevm.bundle
Runtime path (where Hyper-V/HCS looks for files):
C:\Users\<username>\AppData\Local\Packages\Claude_pzs8sxrjxfjjc\LocalCache\Roaming\Claude\vm_bundles\claudevm.bundle
This means every time Cowork tries to start, it either can't find the files or finds them in the wrong place. The rootfs.vhdx goes missing between attempts because it is being downloaded to the Roaming path but the VM service looks in the Local\Packages path.
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Property | Value
-- | --
OS | Windows (domain-joined machine)
Claude Desktop version | 1.1.7464.0
Subscription | (paid plan)
Hyper-V | Enabled, vmms service Running
VPN | Perimeter 81 installed (WireGuard-based)
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What Should Happen?
Cowork should use a single consistent path for both downloading and accessing VM bundle files, and the workspace should start successfully.
Error Messages/Logs
Error from cowork_vm_node.log
2026-03-19 13:07:09 [error] [VM:start] VM boot failed: HCS operation failed: failed to start VM:
HcsWaitForOperationResult failed with HRESULT 0x80070005:
"Account does not have permission to open attachment
'C:\Users\<username>\AppData\Local\Packages\Claude_pzs8sxrjxfjjc\LocalCache\Roaming\Claude\vm_bundles\claudevm.bundle\rootfs.vhdx (Lun 0)'.
Error: 'Access is denied.' (0x80070005)"
2026-03-19 13:26:17 [info] [Bundle:status] rootfs.vhdx missing
2026-03-19 13:26:17 [info] rootfs.vhdx not found, downloading...Steps to Reproduce
Install Claude Desktop v1.1.7464.0 on Windows with Hyper-V enabled
Open Claude Desktop and switch to Cowork mode
Observe "VM service not running" error immediately
Troubleshooting Already Attempted (all unsuccessful)
Restarted Claude and rebooted machine
Used Help → Troubleshooting → Clear cache and restart
Manually deleted VM bundle at both paths and allowed re-download
Granted FullControl permissions to NT VIRTUAL MACHINE\Virtual Machines and SYSTEM on the vm_bundles folder and all files using PowerShell Set-Acl
Manually copied smol-bin.x64.vhdx from the app install directory to the bundle folder
Disconnected Perimeter 81 VPN
Verified cmd.exe exists at C:\Windows\System32\cmd.exe ✅
Verified rootfs.vhdx permissions show FullControl for NT VIRTUAL MACHINE\Virtual Machines ✅
Claude Model
None
Is this a regression?
No, this never worked
Last Working Version
_No response_
Claude Code Version
1.1.7464.0
Platform
Anthropic API
Operating System
Windows
Terminal/Shell
Other
Additional Information
The Windows event log shows CoworkVMService (displayed as "Claude") terminating unexpectedly every attempt (Event ID 7034)
Perimeter 81 VPN is installed and may leave behind network adapters that interfere with Cowork's internal VM networking, even when disconnected
The cowork_vm_node.log shows the download path as AppData\Roaming\Claude\vm_bundles while the HCS error references AppData\Local\Packages\...\vm_bundles — these should be the same path
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