Pytest test discovery is failing. The UI states:
Test discovery error, please check the configuration settings for the tests
The output window s
Seems like a bug in the latest version of VS Code Python extension. I had the same issue, then I downgraded the Python extension to 2019.3.6558 and then it works again. So we should go to our VS Code extensions list, select the Python extension and "Install another version..." from the setting of that extension.
I hope this works for you too.