diff --git a/Cargo.lock b/Cargo.lock
index d5a32e803a12e93405c88b7f7ad66b71d93fe740..63cc81619a14a3e1b5b59b2048fd12bee56df588 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -3345,6 +3345,7 @@ dependencies = [
  "collections",
  "command_palette_hooks",
  "ctor",
+ "dirs 4.0.0",
  "editor",
  "fs",
  "futures 0.3.31",
diff --git a/crates/copilot/Cargo.toml b/crates/copilot/Cargo.toml
index c859d912b416c4ef0dd00bb9735ff1d99230200e..234875d420bd035a1c2d0955a4a68d165ef702d1 100644
--- a/crates/copilot/Cargo.toml
+++ b/crates/copilot/Cargo.toml
@@ -29,6 +29,7 @@ chrono.workspace = true
 client.workspace = true
 collections.workspace = true
 command_palette_hooks.workspace = true
+dirs.workspace = true
 fs.workspace = true
 futures.workspace = true
 gpui.workspace = true
diff --git a/crates/copilot/src/copilot_chat.rs b/crates/copilot/src/copilot_chat.rs
index 7e8240c942d2dc8a0e7fea029b6c6236badebaa4..a80ac5682cde668dff88a19c663cb06c6363e794 100644
--- a/crates/copilot/src/copilot_chat.rs
+++ b/crates/copilot/src/copilot_chat.rs
@@ -360,12 +360,15 @@ pub fn copilot_chat_config_dir() -> &'static PathBuf {
     static COPILOT_CHAT_CONFIG_DIR: OnceLock<PathBuf> = OnceLock::new();
 
     COPILOT_CHAT_CONFIG_DIR.get_or_init(|| {
-        if cfg!(target_os = "windows") {
-            home_dir().join("AppData").join("Local")
+        let config_dir = if cfg!(target_os = "windows") {
+            dirs::data_local_dir().expect("failed to determine LocalAppData directory")
         } else {
-            home_dir().join(".config")
-        }
-        .join("github-copilot")
+            std::env::var("XDG_CONFIG_HOME")
+                .map(PathBuf::from)
+                .unwrap_or_else(|_| home_dir().join(".config"))
+        };
+
+        config_dir.join("github-copilot")
     })
 }