Just installed Visual Studio Code 1.1.1 on a Windows 7 machine. When I right-click on a folder, \"Open With Code\" does not appear.
NB: This is for the 32-bit version, for the 64-bit version see Cepharum's answer.
Slight change to the previous answer to allow non Admins to get the functionality in their context menus:
Create file vsCodeOpenFolder.reg with this content (If you didn't chose the default installation path then you need to adjust the paths in this file):
Windows Registry Editor Version 5.00
; Open files
[HKEY_CURRENT_USER\Software\Classes\*\shell\Open with VS Code]
@="Edit with VS Code"
"Icon"="C:\\Program Files (x86)\\Microsoft VS Code\\Code.exe,0"
[HKEY_CURRENT_USER\Software\Classes\*\shell\Open with VS Code\command]
@="\"C:\\Program Files (x86)\\Microsoft VS Code\\Code.exe\" \"%1\""
; This will make it appear when you right click ON a folder
; The "Icon" line can be removed if you don't want the icon to appear
[HKEY_CURRENT_USER\Software\Classes\Directory\shell\vscode]
@="Open Folder as VS Code Project"
"Icon"="\"C:\\Program Files (x86)\\Microsoft VS Code\\Code.exe\",0"
[HKEY_CURRENT_USER\Software\Classes\Directory\shell\vscode\command]
@="\"C:\\Program Files (x86)\\Microsoft VS Code\\Code.exe\" \"%1\""
; This will make it appear when you right click INSIDE a folder
; The "Icon" line can be removed if you don't want the icon to appear
[HKEY_CURRENT_USER\Software\Classes\Directory\Background\shell\vscode]
@="Open Folder as VS Code Project"
"Icon"="\"C:\\Program Files (x86)\\Microsoft VS Code\\Code.exe\",0
[HKEY_CURRENT_USER\Software\Classes\Directory\Background\shell\vscode\command]
@="\"C:\\Program Files (x86)\\Microsoft VS Code\\Code.exe\" \"%V\""
Double click it to create the registry entries
Essentially I have replaced HKEY_CLASSES_ROOT with HKEY_CURRENT_USER\Software\Classes