The correct option is Only the code in the active editing context is sent to the Copilot service where it is processed to produce a suggestion. Copilot uses the immediate editing prompt which includes the current file and nearby context and sends that to the service to generate a completion that is returned to the IDE.

This approach confines what is shared to the smallest useful window of code and comments. It reduces data exposure and helps the service respond quickly because it does not need to scan the entire project. The context can include surrounding lines, open tabs, and recent edits depending on the IDE integration and policy settings.

The entire repository is uploaded to the Copilot service so suggestions can account for the full project context is incorrect because Copilot does not transmit full repositories and instead scopes each request to a small and relevant slice of code.

The source is mirrored to Vertex AI in Google Cloud where inference is performed to return completions is incorrect because GitHub Copilot is not a Google Vertex AI service and inference is provided by GitHub and Microsoft operated services.

All analysis runs on the developer machine and nothing is transmitted beyond the local environment is incorrect because the editor sends prompt data to the service and model inference happens in the cloud in order to produce suggestions.

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