diff --git a/cli/azd/extensions/azure.ai.agents/CHANGELOG.md b/cli/azd/extensions/azure.ai.agents/CHANGELOG.md
index cd2e7999bdd..0329ec42ca0 100644
--- a/cli/azd/extensions/azure.ai.agents/CHANGELOG.md
+++ b/cli/azd/extensions/azure.ai.agents/CHANGELOG.md
@@ -1,5 +1,9 @@
 # Release History
 
+## 0.1.18-preview (2026-03-23)
+
+- [[#7147]](https://github.com/Azure/azure-dev/pull/7147) Add `azd ai agent init` support for initializing from an agent template.
+
 ## 0.1.17-preview (2026-03-20)
 
 - [[#7214]](https://github.com/Azure/azure-dev/pull/7214) Add ASCII art banner with Foundry branding and version info displayed at extension startup.
diff --git a/cli/azd/extensions/azure.ai.agents/extension.yaml b/cli/azd/extensions/azure.ai.agents/extension.yaml
index 70c06c093e3..06b7b4a81dd 100644
--- a/cli/azd/extensions/azure.ai.agents/extension.yaml
+++ b/cli/azd/extensions/azure.ai.agents/extension.yaml
@@ -5,7 +5,7 @@ displayName: Foundry agents (Preview)
 description: Ship agents with Microsoft Foundry from your terminal. (Preview)
 usage: azd ai agent <command> [options]
 # NOTE: Make sure version.txt is in sync with this version.
-version: 0.1.17-preview
+version: 0.1.18-preview
 requiredAzdVersion: ">1.23.6"
 language: go
 capabilities:
diff --git a/cli/azd/extensions/azure.ai.agents/version.txt b/cli/azd/extensions/azure.ai.agents/version.txt
index 76226a944ee..85e4e1027d4 100644
--- a/cli/azd/extensions/azure.ai.agents/version.txt
+++ b/cli/azd/extensions/azure.ai.agents/version.txt
@@ -1 +1 @@
-0.1.17-preview
+0.1.18-preview