diff --git a/playwright/github-byot-ai.spec.ts b/playwright/github-byot-ai.spec.ts
index 55868a0..a9f2bef 100644
--- a/playwright/github-byot-ai.spec.ts
+++ b/playwright/github-byot-ai.spec.ts
@@ -15,6 +15,7 @@ import {
 } from './helpers/app-test-helpers.js'
 import {
   getAllWorkspaceRecords,
+  openStoredWorkspaceContextById,
   seedLocalWorkspaceContexts,
 } from './github-pr-drawer/github-pr-drawer.helpers.js'
 
@@ -400,6 +401,79 @@ test('Local workspace can be renamed from Workspaces drawer', async ({ page }) =
   )
 })
 
+test('chat stays usable after opening a Local workspace with PAT connected', async ({
+  page,
+}) => {
+  const localWorkspaceId = 'local_chat_issue_128'
+  let streamRequestBody: ChatRequestBody | undefined
+
+  await page.route('https://models.github.ai/inference/chat/completions', async route => {
+    streamRequestBody = route.request().postDataJSON() as ChatRequestBody
+
+    await route.fulfill({
+      status: 200,
+      contentType: 'text/event-stream',
+      body: [
+        'data: {"choices":[{"delta":{"content":"Local workspace chat works"}}]}',
+        '',
+        'data: [DONE]',
+        '',
+      ].join('\n'),
+    })
+  })
+
+  await waitForAppReady(page)
+
+  await seedLocalWorkspaceContexts(page, [
+    {
+      id: localWorkspaceId,
+      repo: '',
+      workspaceScope: 'local',
+      head: 'feat/local-chat-issue-128',
+      prTitle: 'Issue 128 local workspace',
+      prContextState: 'inactive',
+      tabs: [
+        {
+          id: 'component',
+          path: 'src/component.tsx',
+          language: 'tsx',
+          role: 'component',
+          content: 'export const App = () => <main>local chat issue 128</main>',
+          order: 0,
+          source: 'workspace',
+          dirty: false,
+        },
+      ],
+      activeTabId: 'component',
+    },
+  ])
+
+  await connectByotWithSingleRepo(page)
+  await openStoredWorkspaceContextById(page, localWorkspaceId, {
+    repositoryFilter: '__local__',
+  })
+  await ensureWorkspacesDrawerClosed(page)
+
+  await ensureAiChatDrawerOpen(page)
+
+  await page.getByLabel('Ask AI assistant').fill('Confirm local workspace chat context.')
+  await page.getByRole('button', { name: 'Send' }).click()
+
+  await expect(page.getByText('Local workspace chat works')).toBeVisible()
+  await expect(
+    page.getByText('Select a writable repository before starting chat.', { exact: true }),
+  ).toHaveCount(0)
+
+  const repositorySystemMessage = streamRequestBody?.messages?.find(
+    (message: ChatRequestMessage) =>
+      message.role === 'system' &&
+      message.content?.includes('Selected repository context'),
+  )
+  expect(repositorySystemMessage?.content).toContain(
+    'Repository: knightedcodemonkey/develop',
+  )
+})
+
 test('BYOT controls render with default app entry', async ({ page }) => {
   await waitForAppReady(page, appEntryPath)
 
diff --git a/src/app.js b/src/app.js
index 3f1a7be..3ca41ae 100644
--- a/src/app.js
+++ b/src/app.js
@@ -607,6 +607,25 @@ const getCurrentSelectedRepositoryFullName = () => {
   return ''
 }
 
+const getActiveWorkspaceDisplayLabel = workspace => {
+  const workspaceIdFromArg = toNonEmptyWorkspaceText(workspace?.id)
+  const activeWorkspaceId = toNonEmptyWorkspaceText(activeWorkspaceRecordId)
+  if (
+    workspaceIdFromArg &&
+    activeWorkspaceId &&
+    workspaceIdFromArg !== activeWorkspaceId
+  ) {
+    return ''
+  }
+
+  return (
+    toNonEmptyWorkspaceText(activeWorkspacePersistedPrTitle) ||
+    toNonEmptyWorkspaceText(activeWorkspacePersistedHeadBranch) ||
+    toNonEmptyWorkspaceText(githubPrTitle?.value) ||
+    toNonEmptyWorkspaceText(githubPrHeadBranch?.value)
+  )
+}
+
 workspaceContextStatusController = createWorkspaceContextStatusController({
   statusNode: workspaceContextStatus,
   toNonEmptyWorkspaceText,
@@ -1138,6 +1157,7 @@ const githubWorkflows = createGitHubWorkflowsSetup({
   workspace: {
     workspaceStorage,
     getActiveWorkspaceRecordId: () => activeWorkspaceRecordId,
+    getActiveWorkspaceDisplayLabel,
     setActiveWorkspaceRecordId,
     setActiveWorkspaceCreatedAt: value => (activeWorkspaceCreatedAt = value),
     buildWorkspaceRecordSnapshot,
diff --git a/src/modules/app-core/github-workflows-setup.js b/src/modules/app-core/github-workflows-setup.js
index b4b8fa2..e6f9cc6 100644
--- a/src/modules/app-core/github-workflows-setup.js
+++ b/src/modules/app-core/github-workflows-setup.js
@@ -23,6 +23,7 @@ const createGitHubWorkflowsSetup = ({
     setActiveWorkspaceRecordId: workspace.setActiveWorkspaceRecordId,
     setActiveWorkspaceCreatedAt: workspace.setActiveWorkspaceCreatedAt,
     buildWorkspaceRecordSnapshot: workspace.buildWorkspaceRecordSnapshot,
+    getActiveWorkspaceDisplayLabel: workspace.getActiveWorkspaceDisplayLabel,
     listLocalContextRecords: workspace.listLocalContextRecords,
     refreshLocalContextOptions: workspace.refreshLocalContextOptions,
     applyWorkspaceRecord: workspace.applyWorkspaceRecord,
diff --git a/src/modules/app-core/github-workflows.js b/src/modules/app-core/github-workflows.js
index ec55a0f..5884dc6 100644
--- a/src/modules/app-core/github-workflows.js
+++ b/src/modules/app-core/github-workflows.js
@@ -50,6 +50,7 @@ const initializeGitHubWorkflows = ({
   workspacesRemove,
   workspaceStorage,
   getActiveWorkspaceRecordId,
+  getActiveWorkspaceDisplayLabel,
   setActiveWorkspaceRecordId,
   setActiveWorkspaceCreatedAt,
   buildWorkspaceRecordSnapshot,
@@ -430,6 +431,10 @@ const initializeGitHubWorkflows = ({
     openButton: workspacesOpen,
     renameButton: workspacesRename,
     removeButton: workspacesRemove,
+    getActiveWorkspaceDisplayLabel: workspace =>
+      typeof getActiveWorkspaceDisplayLabel === 'function'
+        ? toSafeWorkspaceText(getActiveWorkspaceDisplayLabel(workspace))
+        : '',
     getRepositoryFilterOptions: () =>
       getCurrentWritableRepositories().map(repository => ({
         value: repository.fullName,
diff --git a/src/modules/app-core/workspace-record-applied-handler.js b/src/modules/app-core/workspace-record-applied-handler.js
index 210b25d..f69c820 100644
--- a/src/modules/app-core/workspace-record-applied-handler.js
+++ b/src/modules/app-core/workspace-record-applied-handler.js
@@ -21,7 +21,6 @@ const createWorkspaceRecordAppliedHandler = ({
       byotControls?.setSelectedRepository(nextWorkspaceRepositoryFullName)
     } else {
       setWorkspaceRepositoryFullName('')
-      byotControls?.clearSelectedRepositoryPreference?.()
     }
 
     const state =
diff --git a/src/modules/workspace/workspaces-drawer/drawer.js b/src/modules/workspace/workspaces-drawer/drawer.js
index 08f985e..e574121 100644
--- a/src/modules/workspace/workspaces-drawer/drawer.js
+++ b/src/modules/workspace/workspaces-drawer/drawer.js
@@ -54,6 +54,7 @@ export const createWorkspacesDrawer = ({
   renameButton,
   removeButton,
   getDrawerSide,
+  getActiveWorkspaceDisplayLabel,
   getRepositoryFilterOptions,
   getSelectedRepositoryFilter,
   onRepositoryFilterChange,
@@ -242,10 +243,19 @@ export const createWorkspacesDrawer = ({
     placeholder.selected = !filteredEntries.some(entry => entry.id === selectedId)
     selectInput.append(placeholder)
 
+    const activeWorkspaceId =
+      typeof getActiveWorkspaceId === 'function' ? toSafeText(getActiveWorkspaceId()) : ''
+
     for (const entry of filteredEntries) {
       const option = document.createElement('option')
       option.value = toSafeText(entry.id)
-      option.textContent = toWorkspaceLabel(entry)
+      const activeWorkspaceDisplayLabel =
+        option.value &&
+        option.value === activeWorkspaceId &&
+        typeof getActiveWorkspaceDisplayLabel === 'function'
+          ? toSafeText(getActiveWorkspaceDisplayLabel(entry))
+          : ''
+      option.textContent = activeWorkspaceDisplayLabel || toWorkspaceLabel(entry)
       option.selected = option.value === selectedId
       selectInput.append(option)
     }