diff --git a/registry/coder/modules/zed/README.md b/registry/coder/modules/zed/README.md
index cffb71448..7d145dc6f 100644
--- a/registry/coder/modules/zed/README.md
+++ b/registry/coder/modules/zed/README.md
@@ -19,7 +19,7 @@ Zed is a high-performance, multiplayer code editor from the creators of Atom and
 module "zed" {
   count    = data.coder_workspace.me.start_count
   source   = "registry.coder.com/coder/zed/coder"
-  version  = "1.1.4"
+  version  = "1.1.5"
   agent_id = coder_agent.main.id
 }
 ```
@@ -32,7 +32,7 @@ module "zed" {
 module "zed" {
   count    = data.coder_workspace.me.start_count
   source   = "registry.coder.com/coder/zed/coder"
-  version  = "1.1.4"
+  version  = "1.1.5"
   agent_id = coder_agent.main.id
   folder   = "/home/coder/project"
 }
@@ -44,7 +44,7 @@ module "zed" {
 module "zed" {
   count        = data.coder_workspace.me.start_count
   source       = "registry.coder.com/coder/zed/coder"
-  version      = "1.1.4"
+  version      = "1.1.5"
   agent_id     = coder_agent.main.id
   display_name = "Zed Editor"
   order        = 1
@@ -57,7 +57,7 @@ module "zed" {
 module "zed" {
   count      = data.coder_workspace.me.start_count
   source     = "registry.coder.com/coder/zed/coder"
-  version    = "1.1.4"
+  version    = "1.1.5"
   agent_id   = coder_agent.main.id
   agent_name = coder_agent.example.name
 }
@@ -73,7 +73,7 @@ You can declaratively set/merge settings with the `settings` input. Provide a JS
 module "zed" {
   count    = data.coder_workspace.me.start_count
   source   = "registry.coder.com/coder/zed/coder"
-  version  = "1.1.4"
+  version  = "1.1.5"
   agent_id = coder_agent.main.id
 
   settings = jsonencode({
@@ -91,4 +91,4 @@ module "zed" {
 }
 ```
 
-See Zed’s settings files documentation: https://zed.dev/docs/configuring-zed#settings-files
+See Zed's settings files documentation: https://zed.dev/docs/configuring-zed#settings-files
diff --git a/registry/coder/modules/zed/main.test.ts b/registry/coder/modules/zed/main.test.ts
index 9a39b47b1..baf7905e8 100644
--- a/registry/coder/modules/zed/main.test.ts
+++ b/registry/coder/modules/zed/main.test.ts
@@ -103,27 +103,16 @@ describe("zed", async () => {
     }
   }, 30000);
 
-  it("exits early with empty settings", async () => {
+  it("does not create coder_script when settings is empty", async () => {
     const state = await runTerraformApply(import.meta.dir, {
       agent_id: "foo",
       settings: "",
     });
 
-    const instance = findResourceInstance(state, "coder_script");
-    const id = await runContainer("alpine:latest");
-
-    try {
-      const result = await execContainer(id, ["sh", "-c", instance.script]);
-      expect(result.exitCode).toBe(0);
-
-      // Settings file should not be created
-      const catResult = await execContainer(id, [
-        "cat",
-        "/root/.config/zed/settings.json",
-      ]);
-      expect(catResult.exitCode).not.toBe(0);
-    } finally {
-      await removeContainer(id);
-    }
+    // With count = 0, no coder_script resource should exist
+    const scripts = state.resources?.filter(
+      (r: { type: string }) => r.type === "coder_script",
+    );
+    expect(scripts?.length ?? 0).toBe(0);
   }, 30000);
 });
diff --git a/registry/coder/modules/zed/main.tf b/registry/coder/modules/zed/main.tf
index 414c3c0e9..08e9519f6 100644
--- a/registry/coder/modules/zed/main.tf
+++ b/registry/coder/modules/zed/main.tf
@@ -69,6 +69,7 @@ locals {
 }
 
 resource "coder_script" "zed_settings" {
+  count        = var.settings != "" ? 1 : 0
   agent_id     = var.agent_id
   display_name = "Configure Zed settings"
   icon         = "/icon/zed.svg"
@@ -77,9 +78,6 @@ resource "coder_script" "zed_settings" {
     #!/usr/bin/env bash
     set -eu
     SETTINGS_B64='${local.settings_b64}'
-    if [ -z "$${SETTINGS_B64}" ]; then
-      exit 0
-    fi
     SETTINGS_JSON="$(echo -n "$${SETTINGS_B64}" | base64 -d)"
     if [ -z "$${SETTINGS_JSON}" ] || [ "$${SETTINGS_JSON}" = "{}" ]; then
       exit 0
diff --git a/registry/coder/modules/zed/zed.tftest.hcl b/registry/coder/modules/zed/zed.tftest.hcl
index 339f6876f..e6e021d82 100644
--- a/registry/coder/modules/zed/zed.tftest.hcl
+++ b/registry/coder/modules/zed/zed.tftest.hcl
@@ -94,12 +94,12 @@ run "settings_base64_encoding" {
 
   # Verify settings are base64 encoded (eyJ = base64 prefix for JSON starting with {")
   assert {
-    condition     = can(regex("SETTINGS_B64='eyJ", coder_script.zed_settings.script))
+    condition     = can(regex("SETTINGS_B64='eyJ", coder_script.zed_settings[0].script))
     error_message = "settings should be base64 encoded in the script"
   }
 }
 
-run "empty_settings" {
+run "empty_settings_no_script" {
   command = apply
 
   variables {
@@ -108,7 +108,7 @@ run "empty_settings" {
   }
 
   assert {
-    condition     = can(regex("SETTINGS_B64=''", coder_script.zed_settings.script))
-    error_message = "empty settings should result in empty SETTINGS_B64"
+    condition     = length(coder_script.zed_settings) == 0
+    error_message = "coder_script should not be created when settings is empty"
   }
 }