What
CLAUDE_CODE_RESTRICT_PERSONAL_CONFIG is a new environment variable (a setting given to a program from the shell) that limits what your own Claude Code files can do in a session. When it is set, Claude Code refuses to launch a cloud agent, a helper that runs the work on a remote machine. The error explains that the cloud session would not apply those limits, and it tells you to set isolation to "worktree" instead. A worktree is a separate copy of your project on your own machine.
Why
A restricted session can no longer quietly pass work to a cloud session that would ignore the restrictions.
Names in the bundleCLAUDE_CODE_RESTRICT_PERSONAL_CONFIG
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The name it cites is new in this build
New in this build: CLAUDE_CODE_RESTRICT_PERSONAL_CONFIG