diff --git a/pkg/cmd/codespace/common.go b/pkg/cmd/codespace/common.go
index ee25854dc..ba0e8a9f6 100644
--- a/pkg/cmd/codespace/common.go
+++ b/pkg/cmd/codespace/common.go
@@ -66,7 +66,7 @@ type liveshareSession interface {
 	StartSharing(context.Context, string, int) (liveshare.ChannelID, error)
 	StartSSHServer(context.Context) (int, string, error)
 	StartSSHServerWithOptions(context.Context, liveshare.StartSSHServerOptions) (int, string, error)
-	RebuildContainer(context.Context) error
+	RebuildContainer(context.Context, bool) error
 }
 
 // Connects to a codespace using Live Share and returns that session
diff --git a/pkg/cmd/codespace/rebuild.go b/pkg/cmd/codespace/rebuild.go
index f2128d632..246a6ebc4 100644
--- a/pkg/cmd/codespace/rebuild.go
+++ b/pkg/cmd/codespace/rebuild.go
@@ -10,22 +10,27 @@ import (
 
 func newRebuildCmd(app *App) *cobra.Command {
 	var codespace string
+	var fullRebuild bool
 
 	rebuildCmd := &cobra.Command{
 		Use:   "rebuild",
 		Short: "Rebuild a codespace",
-		Args:  cobra.NoArgs,
+		Long: `Rebuilding recreates your codespace. Your code and any current changes will be
+preserved. Your codespace will be rebuilt using your working directory's
+dev container. A full rebuild also removes cached Docker images.`,
+		Args: cobra.NoArgs,
 		RunE: func(cmd *cobra.Command, args []string) error {
-			return app.Rebuild(cmd.Context(), codespace)
+			return app.Rebuild(cmd.Context(), codespace, fullRebuild)
 		},
 	}
 
-	rebuildCmd.Flags().StringVarP(&codespace, "codespace", "c", "", "Name of the codespace")
+	rebuildCmd.Flags().StringVarP(&codespace, "codespace", "c", "", "name of the codespace")
+	rebuildCmd.Flags().BoolVar(&fullRebuild, "full", false, "perform a full rebuild")
 
 	return rebuildCmd
 }
 
-func (a *App) Rebuild(ctx context.Context, codespaceName string) (err error) {
+func (a *App) Rebuild(ctx context.Context, codespaceName string, full bool) (err error) {
 	ctx, cancel := context.WithCancel(ctx)
 	defer cancel()
 
@@ -46,7 +51,7 @@ func (a *App) Rebuild(ctx context.Context, codespaceName string) (err error) {
 	}
 	defer safeClose(session, &err)
 
-	err = session.RebuildContainer(ctx)
+	err = session.RebuildContainer(ctx, full)
 	if err != nil {
 		return fmt.Errorf("rebuilding codespace via session: %w", err)
 	}
diff --git a/pkg/cmd/codespace/rebuild_test.go b/pkg/cmd/codespace/rebuild_test.go
index fff40fe1b..ec8b112de 100644
--- a/pkg/cmd/codespace/rebuild_test.go
+++ b/pkg/cmd/codespace/rebuild_test.go
@@ -15,7 +15,7 @@ func TestAlreadyRebuildingCodespace(t *testing.T) {
 	}
 	app := testingRebuildApp(*rebuildingCodespace)
 
-	err := app.Rebuild(context.Background(), "rebuildingCodespace")
+	err := app.Rebuild(context.Background(), "rebuildingCodespace", false)
 	if err != nil {
 		t.Errorf("rebuilding a codespace that was already rebuilding: %v", err)
 	}
diff --git a/pkg/liveshare/session.go b/pkg/liveshare/session.go
index 40bdf287b..39fd46e5f 100644
--- a/pkg/liveshare/session.go
+++ b/pkg/liveshare/session.go
@@ -123,9 +123,14 @@ func (s *Session) StartJupyterServer(ctx context.Context) (int, string, error) {
 	return port, response.ServerUrl, nil
 }
 
-func (s *Session) RebuildContainer(ctx context.Context) error {
+func (s *Session) RebuildContainer(ctx context.Context, full bool) error {
+	rpcMethod := "IEnvironmentConfigurationService.incrementalRebuildContainer"
+	if full {
+		rpcMethod = "IEnvironmentConfigurationService.rebuildContainer"
+	}
+
 	var rebuildSuccess bool
-	err := s.rpc.do(ctx, "IEnvironmentConfigurationService.rebuildContainer", nil, &rebuildSuccess)
+	err := s.rpc.do(ctx, rpcMethod, nil, &rebuildSuccess)
 	if err != nil {
 		return fmt.Errorf("invoking rebuild RPC: %w", err)
 	}
diff --git a/pkg/liveshare/session_test.go b/pkg/liveshare/session_test.go
index 06000c344..4f7751032 100644
--- a/pkg/liveshare/session_test.go
+++ b/pkg/liveshare/session_test.go
@@ -400,26 +400,45 @@ func TestSessionHeartbeat(t *testing.T) {
 }
 
 func TestRebuild(t *testing.T) {
-	requestCount := 0
-	getSharedServers := func(conn *jsonrpc2.Conn, req *jsonrpc2.Request) (interface{}, error) {
-		requestCount++
-		return true, nil
-	}
-	testServer, session, err := makeMockSession(
-		livesharetest.WithService("IEnvironmentConfigurationService.rebuildContainer", getSharedServers),
-	)
-	if err != nil {
-		t.Fatalf("creating mock session: %v", err)
-	}
-	defer testServer.Close()
-
-	err = session.RebuildContainer(context.Background())
-	if err != nil {
-		t.Fatalf("rebuilding codespace via mock session: %v", err)
+	tests := []struct {
+		fullRebuild bool
+		rpcService  string
+	}{
+		{
+			fullRebuild: false,
+			rpcService:  "IEnvironmentConfigurationService.incrementalRebuildContainer",
+		},
+		{
+			fullRebuild: true,
+			rpcService:  "IEnvironmentConfigurationService.rebuildContainer",
+		},
 	}
 
-	if requestCount == 0 {
-		t.Fatalf("no requests were made")
+	for _, tt := range tests {
+		t.Logf("RPC service: %s", tt.rpcService)
+		t.Logf("full rebuild: %t", tt.fullRebuild)
+
+		requestCount := 0
+		rebuildContainer := func(conn *jsonrpc2.Conn, req *jsonrpc2.Request) (interface{}, error) {
+			requestCount++
+			return true, nil
+		}
+		testServer, session, err := makeMockSession(
+			livesharetest.WithService(tt.rpcService, rebuildContainer),
+		)
+		if err != nil {
+			t.Errorf("creating mock session: %v", err)
+		}
+		defer testServer.Close()
+
+		err = session.RebuildContainer(context.Background(), tt.fullRebuild)
+		if err != nil {
+			t.Errorf("rebuilding codespace via mock session: %v", err)
+		}
+
+		if requestCount == 0 {
+			t.Errorf("no requests were made")
+		}
 	}
 }