diff --git a/packages/cli/src/config/settings.test.ts b/packages/cli/src/config/settings.test.ts
index 41514f18fe..74138545ab 100644
--- a/packages/cli/src/config/settings.test.ts
+++ b/packages/cli/src/config/settings.test.ts
@@ -2302,18 +2302,18 @@ describe('Settings Loading and Merging', () => {
       expect(loadedSettings.merged.admin?.extensions?.enabled).toBe(false);
     });
 
-    it('should set skills based on advancedFeaturesEnabled', () => {
+    it('should set skills based on unmanagedCapabilitiesEnabled', () => {
       const loadedSettings = loadSettings();
       loadedSettings.setRemoteAdminSettings({
         cliFeatureSetting: {
-          advancedFeaturesEnabled: true,
+          unmanagedCapabilitiesEnabled: true,
         },
       });
       expect(loadedSettings.merged.admin.skills?.enabled).toBe(true);
 
       loadedSettings.setRemoteAdminSettings({
         cliFeatureSetting: {
-          advancedFeaturesEnabled: false,
+          unmanagedCapabilitiesEnabled: false,
         },
       });
       expect(loadedSettings.merged.admin.skills?.enabled).toBe(false);
diff --git a/packages/cli/src/config/settings.ts b/packages/cli/src/config/settings.ts
index dcfaf27f41..8c72a22a09 100644
--- a/packages/cli/src/config/settings.ts
+++ b/packages/cli/src/config/settings.ts
@@ -361,10 +361,9 @@ export class LoadedSettings {
     admin.extensions = {
       enabled: cliFeatureSetting?.extensionsSetting?.extensionsEnabled ?? false,
     };
-
-    if (cliFeatureSetting?.advancedFeaturesEnabled !== undefined) {
-      admin.skills = { enabled: cliFeatureSetting.advancedFeaturesEnabled };
-    }
+    admin.skills = {
+      enabled: cliFeatureSetting?.unmanagedCapabilitiesEnabled ?? false,
+    };
 
     this._remoteAdminSettings = { admin };
     this._merged = this.computeMergedSettings();
diff --git a/packages/core/src/code_assist/types.ts b/packages/core/src/code_assist/types.ts
index 5e706cc207..edac1e8d46 100644
--- a/packages/core/src/code_assist/types.ts
+++ b/packages/core/src/code_assist/types.ts
@@ -308,7 +308,7 @@ const ExtensionsSettingSchema = z.object({
 
 const CliFeatureSettingSchema = z.object({
   extensionsSetting: ExtensionsSettingSchema.optional(),
-  advancedFeaturesEnabled: z.boolean().optional(),
+  unmanagedCapabilitiesEnabled: z.boolean().optional(),
 });
 
 const McpSettingSchema = z.object({