fix #121647

src/vs/workbench/contrib/notebook/browser/notebookEditorWidget.ts

@@ -1185,6 +1185,16 @@ export class NotebookEditorWidget extends Disposable implements INotebookEditor
 			store.add((cell as CodeCellViewModel).onDidRemoveOutputs((outputs) => {
 				outputs.forEach(output => this.removeInset(output));
 			}));
+
+			store.add((cell as CodeCellViewModel).onDidHideOutputs((outputs) => {
+				outputs.forEach(output => this.hideInset(output));
+			}));
+		}
+
+		if (cell.cellKind === CellKind.Markdown) {
+			store.add((cell as MarkdownCellViewModel).onDidHideInput(() => {
+				this.hideMarkdownPreviews([(cell as MarkdownCellViewModel)]);
+			}));
 		}
 
 		return store;

src/vs/workbench/contrib/notebook/browser/viewModel/codeCellViewModel.ts

@@ -24,6 +24,10 @@ export class CodeCellViewModel extends BaseCellViewModel implements ICellViewMod
 	readonly onDidChangeOutputs = this._onDidChangeOutputs.event;
 	private readonly _onDidRemoveOutputs = new Emitter<readonly ICellOutputViewModel[]>();
 	readonly onDidRemoveOutputs = this._onDidRemoveOutputs.event;
+	private readonly _onDidHideInput = new Emitter<void>();
+	readonly onDidHideInput = this._onDidHideInput.event;
+	private readonly _onDidHideOutputs = new Emitter<readonly ICellOutputViewModel[]>();
+	readonly onDidHideOutputs = this._onDidHideOutputs.event;
 	private _outputCollection: number[] = [];
 
 	private _outputsTop: PrefixSumComputer | null = null;
@@ -113,6 +117,16 @@ export class CodeCellViewModel extends BaseCellViewModel implements ICellViewMod
 			this.layoutChange({ outputHeight: true }, 'CodeCellViewModel#model.onDidChangeOutputs');
 		}));
 
+		this._register(this.model.onDidChangeMetadata(e => {
+			if (this.metadata?.outputCollapsed) {
+				this._onDidHideOutputs.fire(this.outputsViewModels.slice(0));
+			}
+
+			if (this.metadata?.inputCollapsed) {
+				this._onDidHideInput.fire();
+			}
+		}));
+
 		this._outputCollection = new Array(this.model.outputs.length);
 
 		this._layoutInfo = {

src/vs/workbench/contrib/notebook/browser/viewModel/markdownCellViewModel.ts

@@ -94,6 +94,9 @@ export class MarkdownCellViewModel extends BaseCellViewModel implements ICellVie
 		return this.model.getHashValue();
 	}
 
+	private readonly _onDidHideInput = new Emitter<void>();
+	readonly onDidHideInput = this._onDidHideInput.event;
+
 	constructor(
 		viewType: string,
 		model: NotebookCellTextModel,
@@ -117,6 +120,12 @@ export class MarkdownCellViewModel extends BaseCellViewModel implements ICellVie
 		this._register(this.onDidChangeState(e => {
 			eventDispatcher.emit([new NotebookCellStateChangedEvent(e, this)]);
 		}));
+
+		this._register(model.onDidChangeMetadata(e => {
+			if (this.metadata?.inputCollapsed) {
+				this._onDidHideInput.fire();
+			}
+		}));
 	}
 
 	/**