diff --git a/codeflash/code_utils/env_utils.py b/codeflash/code_utils/env_utils.py
index eca59bfa8..a7bc8a1fa 100644
--- a/codeflash/code_utils/env_utils.py
+++ b/codeflash/code_utils/env_utils.py
@@ -10,8 +10,7 @@
 from codeflash.cli_cmds.console import logger
 from codeflash.code_utils.code_utils import exit_with_message
 from codeflash.code_utils.formatter import format_code
-from codeflash.code_utils.shell_utils import read_api_key_from_shell_config
-from codeflash.lsp.helpers import is_LSP_enabled
+from codeflash.code_utils.shell_utils import read_api_key_from_shell_config, save_api_key_to_rc
 
 
 def check_formatter_installed(formatter_cmds: list[str], exit_on_failure: bool = True) -> bool:  # noqa
@@ -35,12 +34,21 @@ def check_formatter_installed(formatter_cmds: list[str], exit_on_failure: bool =
 
 @lru_cache(maxsize=1)
 def get_codeflash_api_key() -> str:
-    # prefer shell config over env var in lsp mode
-    api_key = (
-        read_api_key_from_shell_config()
-        if is_LSP_enabled()
-        else os.environ.get("CODEFLASH_API_KEY") or read_api_key_from_shell_config()
-    )
+    # Check environment variable first
+    env_api_key = os.environ.get("CODEFLASH_API_KEY")
+    shell_api_key = read_api_key_from_shell_config()
+
+    # If we have an env var but it's not in shell config, save it for persistence
+    if env_api_key and not shell_api_key:
+        try:
+            from codeflash.either import is_successful
+            result = save_api_key_to_rc(env_api_key)
+            if is_successful(result):
+                logger.debug(f"Automatically saved API key from environment to shell config: {result.unwrap()}")
+        except Exception as e:
+            logger.debug(f"Failed to automatically save API key to shell config: {e}")
+
+    api_key = env_api_key or shell_api_key
 
     api_secret_docs_message = "For more information, refer to the documentation at [https://docs.codeflash.ai/getting-started/codeflash-github-actions#add-your-api-key-to-your-repository-secrets]."  # noqa
     if not api_key: