diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettings.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettings.cs
new file mode 100644
index 0000000000..fecf798215
--- /dev/null
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettings.cs
@@ -0,0 +1,24 @@
+// Copyright (c) Microsoft Corporation
+// The Microsoft Corporation licenses this file to you under the MIT license.
+// See the LICENSE file in the project root for more information.
+
+#nullable enable
+
+using System.Text.Json.Serialization;
+
+namespace Microsoft.CmdPal.Ext.WindowsTerminal.Helpers;
+
+/// <summary>
+/// Strongly typed application-level settings for the Windows Terminal extension.
+/// These are distinct from the dynamic command palette <see cref="JsonSettingsManager"/> based settings
+/// and are meant for simple persisted state (e.g. last selections).
+/// </summary>
+public sealed class AppSettings
+{
+    /// <summary>
+    /// Gets or sets the last selected channel identifier for the Windows Terminal extension.
+    /// Empty string when no channel has been selected yet.
+    /// </summary>
+    [JsonPropertyName("lastSelectedChannel")]
+    public string LastSelectedChannel { get; set; } = string.Empty;
+}
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettingsJsonContext.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettingsJsonContext.cs
new file mode 100644
index 0000000000..712970c3eb
--- /dev/null
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettingsJsonContext.cs
@@ -0,0 +1,15 @@
+// Copyright (c) Microsoft Corporation
+// The Microsoft Corporation licenses this file to you under the MIT license.
+// See the LICENSE file in the project root for more information.
+
+#nullable enable
+
+using System.Text.Json.Serialization;
+
+namespace Microsoft.CmdPal.Ext.WindowsTerminal.Helpers;
+
+[JsonSourceGenerationOptions(WriteIndented = true)]
+[JsonSerializable(typeof(AppSettings))]
+internal sealed partial class AppSettingsJsonContext : JsonSerializerContext
+{
+}
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettingsManager.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettingsManager.cs
new file mode 100644
index 0000000000..2d5cbbd30c
--- /dev/null
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/AppSettingsManager.cs
@@ -0,0 +1,72 @@
+// Copyright (c) Microsoft Corporation
+// The Microsoft Corporation licenses this file to you under the MIT license.
+// See the LICENSE file in the project root for more information.
+
+#nullable enable
+
+using System;
+using System.IO;
+using System.Text.Json;
+using ManagedCommon;
+using Microsoft.CommandPalette.Extensions.Toolkit;
+
+namespace Microsoft.CmdPal.Ext.WindowsTerminal.Helpers;
+
+#nullable enable
+
+public sealed class AppSettingsManager
+{
+    private const string FileName = "appsettings.json";
+
+    private static string SettingsPath()
+    {
+        var directory = Utilities.BaseSettingsPath("Microsoft.CmdPal");
+        Directory.CreateDirectory(directory);
+        return Path.Combine(directory, FileName);
+    }
+
+    private readonly string _filePath;
+
+    public AppSettings Current { get; private set; } = new();
+
+    public AppSettingsManager()
+    {
+        _filePath = SettingsPath();
+        Load();
+    }
+
+    public void Load()
+    {
+        try
+        {
+            if (File.Exists(_filePath))
+            {
+                var json = File.ReadAllText(_filePath);
+                var loaded = JsonSerializer.Deserialize(json, AppSettingsJsonContext.Default.AppSettings);
+                if (loaded is not null)
+                {
+                    Current = loaded;
+                }
+            }
+        }
+        catch (Exception ex)
+        {
+            ExtensionHost.LogMessage(new LogMessage { Message = ex.ToString() });
+            Logger.LogError("Failed to load app settings", ex);
+        }
+    }
+
+    public void Save()
+    {
+        try
+        {
+            var json = JsonSerializer.Serialize(Current, AppSettingsJsonContext.Default.AppSettings);
+            File.WriteAllText(_filePath, json);
+        }
+        catch (Exception ex)
+        {
+            ExtensionHost.LogMessage(new LogMessage { Message = ex.ToString() });
+            Logger.LogError("Failed to save app settings", ex);
+        }
+    }
+}
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/SettingsManager.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/SettingsManager.cs
index d1c8be21f4..38ee476bad 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/SettingsManager.cs
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/SettingsManager.cs
@@ -34,13 +34,21 @@ public class SettingsManager : JsonSettingsManager
         Resources.open_quake_description,
         false);
 
+    private readonly ToggleSetting _saveLastSelectedChannel = new(
+        Namespaced(nameof(SaveLastSelectedChannel)),
+        Resources.save_last_selected_channel!,
+        Resources.save_last_selected_channel_description!,
+        false);
+
     public bool ShowHiddenProfiles => _showHiddenProfiles.Value;
 
     public bool OpenNewTab => _openNewTab.Value;
 
     public bool OpenQuake => _openQuake.Value;
 
-    internal static string SettingsJsonPath()
+    public bool SaveLastSelectedChannel => _saveLastSelectedChannel.Value;
+
+    private static string SettingsJsonPath()
     {
         var directory = Utilities.BaseSettingsPath("Microsoft.CmdPal");
         Directory.CreateDirectory(directory);
@@ -56,6 +64,7 @@ public class SettingsManager : JsonSettingsManager
         Settings.Add(_showHiddenProfiles);
         Settings.Add(_openNewTab);
         Settings.Add(_openQuake);
+        Settings.Add(_saveLastSelectedChannel);
 
         // Load settings from file upon initialization
         LoadSettings();
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/TerminalQuery.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/TerminalQuery.cs
index 0665004018..39b3680470 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/TerminalQuery.cs
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Helpers/TerminalQuery.cs
@@ -61,7 +61,7 @@ public class TerminalQuery : ITerminalQuery
         return profiles.OrderBy(p => p.Name);
     }
 
-    private IEnumerable<TerminalPackage> GetTerminals()
+    public IEnumerable<TerminalPackage> GetTerminals()
     {
         var user = WindowsIdentity.GetCurrent().User;
         var localAppDataPath = Environment.GetEnvironmentVariable("LOCALAPPDATA");
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Icons.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Icons.cs
index 57abd2c01d..9d3072f25e 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Icons.cs
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Icons.cs
@@ -6,9 +6,11 @@ using Microsoft.CommandPalette.Extensions.Toolkit;
 
 namespace Microsoft.CmdPal.Ext.WindowsTerminal;
 
-internal sealed class Icons
+internal static class Icons
 {
     internal static IconInfo TerminalIcon { get; } = IconHelpers.FromRelativePath("Assets\\WindowsTerminal.svg");
 
     internal static IconInfo AdminIcon { get; } = new IconInfo("\xE7EF"); // Admin icon
+
+    internal static IconInfo FilterIcon { get; } = new IconInfo("\uE71C"); // Funnel icon
 }
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Pages/ProfilesListPage.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Pages/ProfilesListPage.cs
index 7e9d2cec31..89bb98ca22 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Pages/ProfilesListPage.cs
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Pages/ProfilesListPage.cs
@@ -2,40 +2,73 @@
 // The Microsoft Corporation licenses this file to you under the MIT license.
 // See the LICENSE file in the project root for more information.
 
+#nullable enable
+
+using System;
 using System.Collections.Generic;
+using System.Diagnostics;
+using System.Linq;
+using ManagedCommon;
 using Microsoft.CmdPal.Ext.WindowsTerminal.Commands;
 using Microsoft.CmdPal.Ext.WindowsTerminal.Helpers;
 using Microsoft.CmdPal.Ext.WindowsTerminal.Properties;
 using Microsoft.CommandPalette.Extensions;
 using Microsoft.CommandPalette.Extensions.Toolkit;
+using Windows.Foundation;
 
 namespace Microsoft.CmdPal.Ext.WindowsTerminal.Pages;
 
-internal sealed partial class ProfilesListPage : ListPage
+internal sealed partial class ProfilesListPage : ListPage, INotifyItemsChanged
 {
+    event TypedEventHandler<object, IItemsChangedEventArgs> INotifyItemsChanged.ItemsChanged
+    {
+        add
+        {
+            ItemsChanged += value;
+            EnsureInitialized();
+            SelectTerminalFilter();
+        }
+
+        remove
+        {
+            ItemsChanged -= value;
+        }
+    }
+
     private readonly TerminalQuery _terminalQuery = new();
     private readonly SettingsManager _terminalSettings;
+    private readonly AppSettingsManager _appSettingsManager;
 
     private bool showHiddenProfiles;
     private bool openNewTab;
     private bool openQuake;
 
-    public ProfilesListPage(SettingsManager terminalSettings)
+    private bool initialized;
+    private TerminalChannelFilters? terminalFilters;
+
+    public ProfilesListPage(SettingsManager terminalSettings, AppSettingsManager appSettingsManager)
     {
         Icon = Icons.TerminalIcon;
         Name = Resources.profiles_list_page_name;
         _terminalSettings = terminalSettings;
+        _appSettingsManager = appSettingsManager;
     }
 
-#pragma warning disable SA1108
-    public List<ListItem> Query()
+    private List<ListItem> Query()
     {
+        EnsureInitialized();
+
         showHiddenProfiles = _terminalSettings.ShowHiddenProfiles;
         openNewTab = _terminalSettings.OpenNewTab;
         openQuake = _terminalSettings.OpenQuake;
 
         var profiles = _terminalQuery.GetProfiles();
 
+        if (terminalFilters?.IsAllSelected == false)
+        {
+            profiles = profiles.Where(profile => profile.Terminal.AppUserModelId == terminalFilters.CurrentFilterId);
+        }
+
         var result = new List<ListItem>();
 
         foreach (var profile in profiles)
@@ -52,12 +85,66 @@ internal sealed partial class ProfilesListPage : ListPage
                 MoreCommands = [
                     new CommandContextItem(new LaunchProfileAsAdminCommand(profile.Terminal.AppUserModelId, profile.Name, openNewTab, openQuake)),
                 ],
-#pragma warning restore SA1108
             });
         }
 
         return result;
     }
 
-    public override IListItem[] GetItems() => Query().ToArray();
+    private void EnsureInitialized()
+    {
+        if (initialized)
+        {
+            return;
+        }
+
+        var terminals = _terminalQuery.GetTerminals();
+        terminalFilters = new TerminalChannelFilters(terminals);
+        terminalFilters.PropChanged += TerminalFiltersOnPropChanged;
+        SelectTerminalFilter();
+        Filters = terminalFilters;
+        initialized = true;
+    }
+
+    private void SelectTerminalFilter()
+    {
+        Trace.Assert(terminalFilters != null);
+
+        // Select the preferred channel if it exists; we always select the preferred channel,
+        // but user have an option to save the preferred channel when he changes the filter
+        if (_terminalSettings.SaveLastSelectedChannel)
+        {
+            if (!string.IsNullOrWhiteSpace(_appSettingsManager.Current.LastSelectedChannel) &&
+                terminalFilters.ContainsFilter(_appSettingsManager.Current.LastSelectedChannel))
+            {
+                terminalFilters.CurrentFilterId = _appSettingsManager.Current.LastSelectedChannel;
+            }
+        }
+        else
+        {
+            terminalFilters.CurrentFilterId = TerminalChannelFilters.AllTerminalsFilterId;
+        }
+    }
+
+    private void TerminalFiltersOnPropChanged(object sender, IPropChangedEventArgs args)
+    {
+        Trace.Assert(terminalFilters != null);
+
+        RaiseItemsChanged();
+        _appSettingsManager.Current.LastSelectedChannel = terminalFilters.CurrentFilterId;
+        _appSettingsManager.Save();
+    }
+
+    public override IListItem[] GetItems()
+    {
+        try
+        {
+            return [.. Query()];
+        }
+        catch (Exception ex)
+        {
+            Logger.LogError("Failed to list Windows Terminal profiles", ex);
+            throw;
+        }
+    }
 }
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Pages/TerminalChannelFilters.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Pages/TerminalChannelFilters.cs
new file mode 100644
index 0000000000..525edb3d41
--- /dev/null
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Pages/TerminalChannelFilters.cs
@@ -0,0 +1,56 @@
+// Copyright (c) Microsoft Corporation
+// The Microsoft Corporation licenses this file to you under the MIT license.
+// See the LICENSE file in the project root for more information.
+
+using System.Collections.Generic;
+using Microsoft.CmdPal.Ext.WindowsTerminal.Properties;
+using Microsoft.CommandPalette.Extensions;
+using Microsoft.CommandPalette.Extensions.Toolkit;
+
+namespace Microsoft.CmdPal.Ext.WindowsTerminal.Pages;
+
+internal sealed partial class TerminalChannelFilters : Filters
+{
+    internal const string AllTerminalsFilterId = "all";
+
+    private readonly List<TerminalPackage> _terminals;
+
+    public bool IsAllSelected => CurrentFilterId == AllTerminalsFilterId;
+
+    public TerminalChannelFilters(IEnumerable<TerminalPackage> terminals, string preselectedFilterId = AllTerminalsFilterId)
+    {
+        CurrentFilterId = preselectedFilterId;
+        _terminals = [.. terminals];
+    }
+
+    public override IFilterItem[] GetFilters()
+    {
+        var items = new List<IFilterItem>
+        {
+            new Filter()
+            {
+                Id = AllTerminalsFilterId,
+                Name = Resources.all_channels,
+                Icon = Icons.FilterIcon,
+            },
+            new Separator(),
+        };
+
+        foreach (var terminalPackage in _terminals)
+        {
+            items.Add(new Filter()
+            {
+                Id = terminalPackage.AppUserModelId,
+                Name = terminalPackage.DisplayName,
+                Icon = new IconInfo(terminalPackage.LogoPath),
+            });
+        }
+
+        return [.. items];
+    }
+
+    public bool ContainsFilter(string id)
+    {
+        return _terminals.FindIndex(terminal => terminal.AppUserModelId == id) > -1;
+    }
+}
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.Designer.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.Designer.cs
index d6fa47029c..21faa322ec 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.Designer.cs
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.Designer.cs
@@ -60,6 +60,15 @@ namespace Microsoft.CmdPal.Ext.WindowsTerminal.Properties {
             }
         }
         
+        /// <summary>
+        ///   Looks up a localized string similar to All channels.
+        /// </summary>
+        internal static string all_channels {
+            get {
+                return ResourceManager.GetString("all_channels", resourceCulture);
+            }
+        }
+        
         /// <summary>
         ///   Looks up a localized string similar to Windows Terminal Profiles.
         /// </summary>
@@ -132,6 +141,24 @@ namespace Microsoft.CmdPal.Ext.WindowsTerminal.Properties {
             }
         }
         
+        /// <summary>
+        ///   Looks up a localized string similar to Preferred channel.
+        /// </summary>
+        internal static string preferred_channel {
+            get {
+                return ResourceManager.GetString("preferred_channel", resourceCulture);
+            }
+        }
+        
+        /// <summary>
+        ///   Looks up a localized string similar to Preferred channel.
+        /// </summary>
+        internal static string preferred_channel_description {
+            get {
+                return ResourceManager.GetString("preferred_channel_description", resourceCulture);
+            }
+        }
+        
         /// <summary>
         ///   Looks up a localized string similar to Windows Terminal Profiles.
         /// </summary>
@@ -159,6 +186,24 @@ namespace Microsoft.CmdPal.Ext.WindowsTerminal.Properties {
             }
         }
         
+        /// <summary>
+        ///   Looks up a localized string similar to Keep last channel filter.
+        /// </summary>
+        internal static string save_last_selected_channel {
+            get {
+                return ResourceManager.GetString("save_last_selected_channel", resourceCulture);
+            }
+        }
+        
+        /// <summary>
+        ///   Looks up a localized string similar to Remember the last selected channel instead of resetting to All Channels..
+        /// </summary>
+        internal static string save_last_selected_channel_description {
+            get {
+                return ResourceManager.GetString("save_last_selected_channel_description", resourceCulture);
+            }
+        }
+        
         /// <summary>
         ///   Looks up a localized string similar to Settings.
         /// </summary>
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.resx b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.resx
index 3b2ab8da6a..774a021c02 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.resx
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/Properties/Resources.resx
@@ -158,4 +158,19 @@
   <data name="list_item_title" xml:space="preserve">
     <value>Open Windows Terminal Profiles</value>
   </data>
+  <data name="preferred_channel" xml:space="preserve">
+    <value>Preferred channel</value>
+  </data>
+  <data name="preferred_channel_description" xml:space="preserve">
+    <value>Preferred channel</value>
+  </data>
+  <data name="all_channels" xml:space="preserve">
+    <value>All channels</value>
+  </data>
+  <data name="save_last_selected_channel" xml:space="preserve">
+    <value>Keep last channel filter</value>
+  </data>
+  <data name="save_last_selected_channel_description" xml:space="preserve">
+    <value>Remember the last selected channel instead of resetting to All Channels.</value>
+  </data>
 </root>
\ No newline at end of file
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/TerminalTopLevelCommandItem.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/TerminalTopLevelCommandItem.cs
index 0eebd98adf..ce5a56e7a7 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/TerminalTopLevelCommandItem.cs
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/TerminalTopLevelCommandItem.cs
@@ -11,8 +11,8 @@ namespace Microsoft.CmdPal.Ext.WindowsTerminal;
 
 public partial class TerminalTopLevelCommandItem : CommandItem
 {
-    public TerminalTopLevelCommandItem(SettingsManager settingsManager)
-        : base(new ProfilesListPage(settingsManager))
+    public TerminalTopLevelCommandItem(SettingsManager settingsManager, AppSettingsManager appSettingsManager)
+        : base(new ProfilesListPage(settingsManager, appSettingsManager))
     {
         Icon = Icons.TerminalIcon;
         Title = Resources.list_item_title;
diff --git a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/WindowsTerminalCommandsProvider.cs b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/WindowsTerminalCommandsProvider.cs
index bd825cbddb..31dc9077bb 100644
--- a/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/WindowsTerminalCommandsProvider.cs
+++ b/src/modules/cmdpal/ext/Microsoft.CmdPal.Ext.WindowsTerminal/WindowsTerminalCommandsProvider.cs
@@ -13,6 +13,7 @@ public partial class WindowsTerminalCommandsProvider : CommandProvider
 {
     private readonly TerminalTopLevelCommandItem _terminalCommand;
     private readonly SettingsManager _settingsManager = new();
+    private readonly AppSettingsManager _appSettingsManager = new();
 
     public WindowsTerminalCommandsProvider()
     {
@@ -21,7 +22,7 @@ public partial class WindowsTerminalCommandsProvider : CommandProvider
         Icon = Icons.TerminalIcon;
         Settings = _settingsManager.Settings;
 
-        _terminalCommand = new TerminalTopLevelCommandItem(_settingsManager)
+        _terminalCommand = new TerminalTopLevelCommandItem(_settingsManager, _appSettingsManager)
         {
             MoreCommands = [
                 new CommandContextItem(Settings.SettingsPage),