diff --git a/crates/ui2/src/components/status_bar.rs b/crates/ui2/src/components/status_bar.rs
index af1b00568f..335c73d5ac 100644
--- a/crates/ui2/src/components/status_bar.rs
+++ b/crates/ui2/src/components/status_bar.rs
@@ -1,7 +1,8 @@
 use std::marker::PhantomData;
+use std::sync::atomic::Ordering;
 
 use crate::prelude::*;
-use crate::{Button, ClickHandler, Icon, IconButton, IconColor, ToolDivider};
+use crate::{get_workspace_state, Button, ClickHandler, Icon, IconButton, IconColor, ToolDivider};
 
 #[derive(Default, PartialEq)]
 pub enum Tool {
@@ -104,7 +105,28 @@ impl<S: 'static + Send + Sync + Clone> StatusBar<S> {
             .flex()
             .items_center()
             .gap_1()
-            .child(IconButton::new(Icon::FileTree).color(IconColor::Accent))
+            .child(
+                IconButton::new(Icon::FileTree)
+                    .color(IconColor::Accent)
+                    .on_click(|_, cx| {
+                        let workspace_state = get_workspace_state();
+
+                        let is_showing_project_panel =
+                            workspace_state.show_project_panel.load(Ordering::SeqCst);
+
+                        workspace_state
+                            .show_project_panel
+                            .compare_exchange(
+                                is_showing_project_panel,
+                                !is_showing_project_panel,
+                                Ordering::SeqCst,
+                                Ordering::SeqCst,
+                            )
+                            .unwrap();
+
+                        cx.notify();
+                    }),
+            )
             .child(IconButton::new(Icon::Hash))
             .child(ToolDivider::new())
             .child(IconButton::new(Icon::XCircle))
@@ -145,10 +167,24 @@ impl<S: 'static + Send + Sync + Clone> StatusBar<S> {
                     .items_center()
                     .gap_1()
                     .child(IconButton::new(Icon::Terminal))
-                    .child(
-                        IconButton::new(Icon::MessageBubbles)
-                            .on_click(|_, _| println!("Chat Panel clicked.")),
-                    )
+                    .child(IconButton::new(Icon::MessageBubbles).on_click(|_, cx| {
+                        let workspace_state = get_workspace_state();
+
+                        let is_showing_chat_panel =
+                            workspace_state.show_chat_panel.load(Ordering::SeqCst);
+
+                        workspace_state
+                            .show_chat_panel
+                            .compare_exchange(
+                                is_showing_chat_panel,
+                                !is_showing_chat_panel,
+                                Ordering::SeqCst,
+                                Ordering::SeqCst,
+                            )
+                            .unwrap();
+
+                        cx.notify();
+                    }))
                     .child(IconButton::new(Icon::Ai)),
             )
     }
diff --git a/crates/ui2/src/components/workspace.rs b/crates/ui2/src/components/workspace.rs
index 7163d66985..a0afa5d493 100644
--- a/crates/ui2/src/components/workspace.rs
+++ b/crates/ui2/src/components/workspace.rs
@@ -14,6 +14,8 @@ use crate::{
 };
 
 pub struct WorkspaceState {
+    pub show_project_panel: Arc<AtomicBool>,
+    pub show_chat_panel: Arc<AtomicBool>,
     pub show_language_selector: Arc<AtomicBool>,
 }
 
@@ -21,8 +23,10 @@ pub struct WorkspaceState {
 /// I can get an explainer on how we should actually be managing state.
 static WORKSPACE_STATE: OnceLock<WorkspaceState> = OnceLock::new();
 
-fn get_workspace_state() -> &'static WorkspaceState {
+pub fn get_workspace_state() -> &'static WorkspaceState {
     let state = WORKSPACE_STATE.get_or_init(|| WorkspaceState {
+        show_project_panel: Arc::new(AtomicBool::new(true)),
+        show_chat_panel: Arc::new(AtomicBool::new(true)),
         show_language_selector: Arc::new(AtomicBool::new(false)),
     });
 
@@ -136,13 +140,18 @@ impl<S: 'static + Send + Sync + Clone> WorkspaceElement<S> {
                     .border_t()
                     .border_b()
                     .border_color(theme.lowest.base.default.border)
-                    .child(
-                        Panel::new(
-                            self.left_panel_scroll_state.clone(),
-                            |_, payload| vec![ProjectPanel::new(ScrollState::default()).into_any()],
-                            Box::new(()),
+                    .children(
+                        Some(
+                            Panel::new(
+                                self.left_panel_scroll_state.clone(),
+                                |_, payload| {
+                                    vec![ProjectPanel::new(ScrollState::default()).into_any()]
+                                },
+                                Box::new(()),
+                            )
+                            .side(PanelSide::Left),
                         )
-                        .side(PanelSide::Left),
+                        .filter(|_| workspace_state.show_project_panel.load(Ordering::SeqCst)),
                     )
                     .child(
                         v_stack()
@@ -169,36 +178,39 @@ impl<S: 'static + Send + Sync + Clone> WorkspaceElement<S> {
                                 .side(PanelSide::Bottom),
                             ),
                     )
-                    .child(
-                        Panel::new(
-                            self.right_panel_scroll_state.clone(),
-                            |_, payload| {
-                                vec![ChatPanel::new(ScrollState::default())
-                                    .with_messages(vec![
-                                        ChatMessage::new(
-                                            "osiewicz".to_string(),
-                                            "is this thing on?".to_string(),
-                                            DateTime::parse_from_rfc3339(
-                                                "2023-09-27T15:40:52.707Z",
-                                            )
-                                            .unwrap()
-                                            .naive_local(),
-                                        ),
-                                        ChatMessage::new(
-                                            "maxdeviant".to_string(),
-                                            "Reading you loud and clear!".to_string(),
-                                            DateTime::parse_from_rfc3339(
-                                                "2023-09-28T15:40:52.707Z",
-                                            )
-                                            .unwrap()
-                                            .naive_local(),
-                                        ),
-                                    ])
-                                    .into_any()]
-                            },
-                            Box::new(()),
+                    .children(
+                        Some(
+                            Panel::new(
+                                self.right_panel_scroll_state.clone(),
+                                |_, payload| {
+                                    vec![ChatPanel::new(ScrollState::default())
+                                        .with_messages(vec![
+                                            ChatMessage::new(
+                                                "osiewicz".to_string(),
+                                                "is this thing on?".to_string(),
+                                                DateTime::parse_from_rfc3339(
+                                                    "2023-09-27T15:40:52.707Z",
+                                                )
+                                                .unwrap()
+                                                .naive_local(),
+                                            ),
+                                            ChatMessage::new(
+                                                "maxdeviant".to_string(),
+                                                "Reading you loud and clear!".to_string(),
+                                                DateTime::parse_from_rfc3339(
+                                                    "2023-09-28T15:40:52.707Z",
+                                                )
+                                                .unwrap()
+                                                .naive_local(),
+                                            ),
+                                        ])
+                                        .into_any()]
+                                },
+                                Box::new(()),
+                            )
+                            .side(PanelSide::Right),
                         )
-                        .side(PanelSide::Right),
+                        .filter(|_| workspace_state.show_chat_panel.load(Ordering::SeqCst)),
                     ),
             )
             .child(StatusBar::new(Arc::new(move |_, cx| {