The original issue only mentions DiffEditor from '@monaco-editor/react' package. How does showing Editor Dialog impacts rendering the DiffEditor? They seem to be separate

@sniok I went through the commit history and narrowed down the issue to that. I think it has to do with Monaco not loading properly if the editor isn't rendered, but feel free to test

@skoeva The example codesandbox in the original issue renders a DiffEditor by itself without any additional logic. Which means that there's something in EditorDialog that breaks monaco editor for the rest of the app unless EditorDialog is being rendered. If that's true then if we just merge this without understanding underlying cause we might encounter some additional problems with this later or in other spots. I think it's important to understand what is causing the issue in the first place.

Of course this shouldn't stop us from reverting the regression, I just want to have understanding of why this is happening

@sniok I suppose it's related to the MonacoEnvironment override, I don't see any specific reason to be redefining it here. I believe the default environment should be fine: I commented it out and it also fixed the issue. Let me know if I'm missing something though