Claude Desktop Cowork is failing to start a workspace on Windows.

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?

Environment:

• Claude Desktop version: 1.8555.1.0
• Windows build: 26200
• Hyper-V / Virtual Machine Platform enabled
• CoworkVMService installs successfully
• CoworkVMService starts successfully

Symptoms:

• Cowork reports "Failed to start Claude's workspace"
• Service starts, then crashes when the VM attempts to launch
• Chat works normally
• Only Cowork fails
• CoworkVMService starts successfully, but the workspace fails during VM startup. Hyper-V returns "Access Denied (0x80070005)" when attempting to attach the VHDX files (smol-bin.vhdx/rootfs.vhdx), causing the service to terminate and Cowork to display "Failed to start Claude's workspace."

Troubleshooting completed:

• Reinstalled Claude multiple times
• Reinstalled workspace multiple times
• Confirmed Hyper-V components are present
• Confirmed StateRepository service is running
• Confirmed CoworkVMService exists and can be started manually
• Confirmed icacls.exe exists at C:\Windows\System32\icacls.exe
• Confirmed VM bundle files exist and have permissions for user, SYSTEM, and Administrators

Relevant log excerpts:

Cowork service log reports:

failed to grant VM access to VHDX: icacls failed

and

Account does not have permission to open attachment
smol-bin.vhdx
Error: Access is denied. (0x80070005)

and later

Account does not have permission to open attachment
rootfs.vhdx
Error: Access is denied. (0x80070005)

Hyper-V / HCS error:

HcsWaitForOperationResult failed with HRESULT 0x80070005 (Access Denied)

The service successfully:

• Loads vmcompute.dll
• Loads computecore.dll
• Creates the VM definition
• Creates the VM runtime ID
• Starts the named pipe server
• Authenticates claude.exe
• Creates the VM session

The failure occurs when Hyper-V attempts to attach the VHDX files to the VM.

Question:
Is this a known issue with Cowork on Windows build 26200, or is there a known fix for the VM disk permission assignment failure?

What Should Happen?

When I open Cowork and start a workspace, Claude should successfully launch the VM workspace, connect to it, and allow me to use Cowork features without errors. The workspace should remain running and accept commands instead of failing with a VM startup error.

Error Messages/Logs

Failed to start Claude's workspace. VM service not running. The service failed to start.

HcsWaitForOperationResult failed with HRESULT 0x80070005 (Access is denied).

failed to grant VM access to VHDX: icacls failed

Account does not have permission to open attachment 'smol-bin.vhdx'. Error: Access is denied. (0x80070005).

Account does not have permission to open attachment 'rootfs.vhdx'. Error: Access is denied. (0x80070005).

The Claude service terminated unexpectedly.

Steps to Reproduce

1. Install Claude Desktop 1.8555.1.0 on Windows Build 26200.

1. Open Claude Desktop and navigate to the Cowork tab.

1. Create a new Cowork project or open an existing project.

1. Grant folder access when prompted.

1. Wait for the workspace VM to start.

1. Observe that the workspace fails to launch and displays "Failed to start Claude's workspace."

1. Review the Cowork service log and observe Hyper-V startup failures with Access Denied (0x80070005) when attempting to attach the VHDX files (smol-bin.vhdx and rootfs.vhdx).

Claude Model

Not sure / Multiple models

Is this a regression?

I don't know

Last Working Version

_No response_

Claude Code Version

1.8555.1 (cfe7d4)

Platform

Anthropic API

Operating System

Windows

Terminal/Shell

PowerShell

Additional Information

_No response_