Windows Central Insider
As part of the June 2026 Security Update for Windows 11 (including the one for Windows 10), Microsoft has quietly changed how the operating system handles folder customizations, and some users may think that the company is shipping once again a buggy update.
The software giant has updated its release notes for the June 2026 Security Update, introducing a new security hardening measure that can prevent custom folder icons and localized folder names from appearing when they rely on a "desktop.ini" file from an untrusted source.
The change affects supported versions of Windows 10 and Windows 11 after installing the latest security updates.
Your folders aren't broken
At first glance, the issue may look like a bug. A folder that previously displayed a custom icon might suddenly revert to the standard yellow folder, while a localized folder name could disappear and show its original name instead.
Even though the user didn't change anything and no application settings were modified, Microsoft says this behavior is expected.
Windows 11 (and 10) now ignores "desktop.ini" files when it cannot confirm that the file originated from a trusted location. The company says files downloaded from the internet, content carrying the Mark-of-the-Web (MOTW) security tag, some WebDAV locations, and certain network paths may be treated as untrusted.
The folders still work normally, and the files inside remain accessible. Only the cosmetic customization is removed.
Microsoft is targeting a forgotten feature
While the visual changes may catch users by surprise, they are really the result of a broader effort to lock down parts of the system that could be exploited.
On Windows 11, the "desktop.ini" is one of those old technologies that most people never think about. For decades, it has allowed folders to change their appearance, display custom names, and behave differently inside File Explorer, and that flexibility also creates an opportunity for abuse.
A malicious individual doesn't always need to exploit a vulnerability to make content look more trustworthy. Sometimes changing an icon, altering a folder name, or disguising content is enough to trick users into opening something they shouldn't.
Microsoft's latest update treats folder presentation as a trust problem rather than a design feature.
How to restore custom icons
Microsoft recommends adding trusted internal sources to the "Trusted Sites" list when organizations need folder customizations to continue working.
You can do this from Control Panel > Network and Internet > Internet Options, and from the "Security" tab, select the "Trusted Sites" option, and then add the source in the "Sites" list.
Businesses that require broader compatibility can also enable the "Allow the use of remote paths in file shortcut icons" policy through the Group Policy Editor, which restores the previous behavior. However, Microsoft warns that doing so reduces protection against potentially malicious remote content.
The policy is located on Computer Configuration > Administrative Templates > Windows Components > File Explorer.
Users can also remove the Mark-of-the-Web tag from trusted "desktop.ini" files using PowerShell, allowing the operating system to process the customization again.
To remove the mark tag, open PowerShell (admin) and run one of the following commands for a single file: Unblock-File "C:\folder\path\desktop.ini"
Or for all "desktop.ini" files in a folder, run this command: Get-ChildItem "C:\folder\path" -Recurse -Filter desktop.ini -Force | Unblock-File
This is a small change on the surface. Yet it reflects a larger trend inside the system. Features that once prioritized flexibility are increasingly being evaluated through a security lens, even if that means some parts of the operating system suddenly look a little less familiar.
Windows Central's Take
I actually think this is the right move, even if it's going to confuse some users at first. When folder icons suddenly revert to the default yellow icon, the natural reaction is to assume Windows Update broke something. However, in this case, Microsoft is intentionally choosing security over customization.
Over the years, I've seen the company gradually tighten controls around older features designed for a very different internet. Technologies that made sense when trust was assumed are now being re-evaluated because they can be used to make content look more legitimate than it really is. Custom folder icons and names may seem harmless, but they can also be used to disguise files and folders in ways that trick less experienced users.
For most people, this change probably won't have any noticeable impact beyond the occasional missing custom icon. Organizations and enthusiasts who rely on these customizations will have a few extra steps to restore them. However, I'd rather see the company add friction to untrusted content than preserve convenience at the expense of security.
What are your thoughts about this change to folder customizations on Windows 11? Let me know in the comments.
More resources
Explore more in-depth how-to guides, troubleshooting advice, and essential tips to get the most out of Windows 11 and 10. Start browsing here:
- Windows 11 on Windows Central — All you need to know
- Windows 10 on Windows Central — All you need to know
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