return {
  'esmuellert/vscode-diff.nvim',
  dependencies = { 'MunifTanjim/nui.nvim' },
  cmd = 'CodeDiff',
  config = function()
    require('vscode-diff').setup {
      -- Highlight configuration
      highlights = {
        -- Line-level: accepts highlight group names or hex colors (e.g., "#2ea043")
        line_insert = 'DiffAdd', -- Line-level insertions
        line_delete = 'DiffDelete', -- Line-level deletions

        -- Character-level: accepts highlight group names or hex colors
        -- If specified, these override char_brightness calculation
        char_insert = nil, -- Character-level insertions (nil = auto-derive)
        char_delete = nil, -- Character-level deletions (nil = auto-derive)

        -- Brightness multiplier (only used when char_insert/char_delete are nil)
        -- nil = auto-detect based on background (1.4 for dark, 0.92 for light)
        char_brightness = nil, -- Auto-adjust based on your colorscheme
      },

      -- Diff view behavior
      diff = {
        disable_inlay_hints = true, -- Disable inlay hints in diff windows for cleaner view
        max_computation_time_ms = 5000, -- Maximum time for diff computation (VSCode default)
      },

      -- Explorer panel configuration
      explorer = {
        position = 'left', -- "left" or "bottom"
        width = 40, -- Width when position is "left" (columns)
        height = 15, -- Height when position is "bottom" (lines)
        indent_markers = true, -- Show indent markers in tree view (│, ├, └)
        icons = {
          folder_closed = '', -- Nerd Font folder icon (customize as needed)
          folder_open = '', -- Nerd Font folder-open icon
        },
        view_mode = 'list', -- "list" or "tree"
        file_filter = {
          ignore = {}, -- Glob patterns to hide (e.g., {"*.lock", "dist/*"})
        },
      },

      -- Keymaps in diff view
      keymaps = {
        view = {
          quit = 'q', -- Close diff tab
          toggle_explorer = '<leader>b', -- Toggle explorer visibility (explorer mode only)
          next_hunk = ']c', -- Jump to next change
          prev_hunk = '[c', -- Jump to previous change
          next_file = ']f', -- Next file in explorer mode
          prev_file = '[f', -- Previous file in explorer mode
          diff_get = 'do', -- Get change from other buffer (like vimdiff)
          diff_put = 'dp', -- Put change to other buffer (like vimdiff)
        },
        explorer = {
          select = '<CR>', -- Open diff for selected file
          hover = 'K', -- Show file diff preview
          refresh = 'R', -- Refresh git status
          toggle_view_mode = 'i', -- Toggle between 'list' and 'tree' views
        },
      },
    }
  end,
}