diff --git a/src/extensionsIntegrated/Terminal/TerminalInstance.js b/src/extensionsIntegrated/Terminal/TerminalInstance.js
index 6807e68c06..b1c9e995b7 100644
--- a/src/extensionsIntegrated/Terminal/TerminalInstance.js
+++ b/src/extensionsIntegrated/Terminal/TerminalInstance.js
@@ -65,6 +65,8 @@ define(function (require, exports, module) {
             cursorAccent: v("--terminal-background"),
             selectionBackground: v("--terminal-selection"),
             selectionForeground: undefined,
+            // Setting a scrollbar width also enables xterm's overview ruler.
+            overviewRulerBorder: "transparent",
             black: v("--terminal-ansi-black"),
             red: v("--terminal-ansi-red"),
             green: v("--terminal-ansi-green"),
@@ -138,6 +140,8 @@ define(function (require, exports, module) {
             cursorBlink: true,
             cursorStyle: "block",
             scrollback: 10000,
+            // Match Phoenix's scrollbar width and keep FitAddon's column calculation in sync.
+            scrollbar: { width: 12 },
             allowProposedApi: true
         });
 
diff --git a/src/styles/Extn-AIChatPanel.less b/src/styles/Extn-AIChatPanel.less
index 927c967cbf..0b95c4da28 100644
--- a/src/styles/Extn-AIChatPanel.less
+++ b/src/styles/Extn-AIChatPanel.less
@@ -259,6 +259,7 @@
     --terminal-foreground:          #cccccc;
     --terminal-cursor:              #ffffff;
     --terminal-selection:           rgba(255, 255, 255, 0.2);
+    --terminal-scrollbar-thumb:      rgba(255, 255, 255, 0.24);
     --terminal-ansi-black:          #000000;
     --terminal-ansi-red:            #cd3131;
     --terminal-ansi-green:          #0dbc79;
diff --git a/src/styles/Extn-Terminal.less b/src/styles/Extn-Terminal.less
index 8743e14cab..ed54b2dd50 100644
--- a/src/styles/Extn-Terminal.less
+++ b/src/styles/Extn-Terminal.less
@@ -27,6 +27,7 @@
     --terminal-foreground: #cccccc;
     --terminal-cursor: #ffffff;
     --terminal-selection: rgba(255, 255, 255, 0.2);
+    --terminal-scrollbar-thumb: rgba(255, 255, 255, 0.24);
     --terminal-border: #333333;
     --terminal-toolbar-bg: #1e1e1e;
     --terminal-tab-bg: #181818;
@@ -57,6 +58,7 @@
     --terminal-foreground: #383a42;
     --terminal-cursor: #383a42;
     --terminal-selection: rgba(0, 0, 0, 0.12);
+    --terminal-scrollbar-thumb: @linux-scrollbar-thumb;
     --terminal-border: #e0e0e0;
     --terminal-toolbar-bg: #f5f5f5;
     --terminal-tab-bg: #eeeeee;
@@ -389,6 +391,51 @@
     background-color: var(--terminal-background) !important;
 }
 
+// xterm draws DOM scrollbars, so the app's native scrollbar selectors do not apply.
+.terminal-instance-container .xterm .xterm-scrollable-element > .xterm-scrollbar {
+    &:hover {
+        background-color: var(--terminal-scrollbar-track-hover, transparent);
+    }
+
+    > .xterm-slider {
+        box-sizing: border-box;
+        border: 2px solid transparent;
+        border-radius: 999px;
+        background-color: var(--terminal-scrollbar-thumb);
+        background-clip: padding-box;
+
+        &:hover {
+            background-color: var(--terminal-scrollbar-thumb-hover, var(--terminal-scrollbar-thumb));
+        }
+
+        &.xterm-active {
+            background-color: var(--terminal-scrollbar-thumb-active, var(--terminal-scrollbar-thumb));
+        }
+
+        .platform-win & {
+            border: none;
+            border-radius: 0;
+        }
+    }
+}
+
+// Match the Windows colors in brackets_scrollbars.less, including the always-dark AI terminals.
+.platform-win .terminal-panel-container {
+    --terminal-scrollbar-thumb: @win-scrollbar-thumb;
+    --terminal-scrollbar-thumb-hover: @win-scrollbar-thumb-hover;
+    --terminal-scrollbar-thumb-active: @win-scrollbar-thumb-active;
+    --terminal-scrollbar-track-hover: @win-scrollbar-track;
+}
+
+.dark.platform-win .terminal-panel-container,
+.darkTheme.platform-win .terminal-panel-container,
+.platform-win .ai-chat-body-cli {
+    --terminal-scrollbar-thumb: rgb(49, 49, 49);
+    --terminal-scrollbar-thumb-hover: rgb(89, 89, 89);
+    --terminal-scrollbar-thumb-active: rgb(169, 169, 169);
+    --terminal-scrollbar-track-hover: rgba(15, 15, 15, 0.5);
+}
+
 /* Empty state */
 .terminal-empty-state {
     display: flex;