diff --git a/build/gulpfile.vscode.js b/build/gulpfile.vscode.js
index 4906bfdb1a2..a274b9efbd3 100644
--- a/build/gulpfile.vscode.js
+++ b/build/gulpfile.vscode.js
@@ -93,7 +93,6 @@ const optimizeVSCodeTask = task.define('optimize-vscode', task.series(
 		resources: vscodeResources,
 		loaderConfig: common.loaderConfig(nodeModules),
 		out: 'out-vscode',
-		inlineAmdImages: true,
 		bundleInfo: undefined
 	})
 ));
diff --git a/build/lib/optimize.js b/build/lib/optimize.js
index f5db4afaaaa..a3d49ea2e7a 100644
--- a/build/lib/optimize.js
+++ b/build/lib/optimize.js
@@ -6,7 +6,6 @@
 Object.defineProperty(exports, "__esModule", { value: true });
 exports.minifyTask = exports.optimizeTask = exports.loaderConfig = void 0;
 const es = require("event-stream");
-const fs = require("fs");
 const gulp = require("gulp");
 const concat = require("gulp-concat");
 const minifyCSS = require("gulp-cssnano");
@@ -134,14 +133,6 @@ function optimizeTask(opts) {
             if (err || !result) {
                 return bundlesStream.emit('error', JSON.stringify(err));
             }
-            if (opts.inlineAmdImages) {
-                try {
-                    result = inlineAmdImages(src, result);
-                }
-                catch (err) {
-                    return bundlesStream.emit('error', JSON.stringify(err));
-                }
-            }
             toBundleStream(src, bundledFileHeader, result.files).pipe(bundlesStream);
             // Remove css inlined resources
             const filteredResources = resources.slice();
@@ -177,39 +168,6 @@ function optimizeTask(opts) {
     };
 }
 exports.optimizeTask = optimizeTask;
-function inlineAmdImages(src, result) {
-    for (const outputFile of result.files) {
-        for (const sourceFile of outputFile.sources) {
-            if (sourceFile.path && /\.js$/.test(sourceFile.path)) {
-                sourceFile.contents = sourceFile.contents.replace(/\([^.]+\.registerAndGetAmdImageURL\(([^)]+)\)\)/g, (_, m0) => {
-                    let imagePath = m0;
-                    // remove `` or ''
-                    if ((imagePath.charAt(0) === '`' && imagePath.charAt(imagePath.length - 1) === '`')
-                        || (imagePath.charAt(0) === '\'' && imagePath.charAt(imagePath.length - 1) === '\'')) {
-                        imagePath = imagePath.substr(1, imagePath.length - 2);
-                    }
-                    if (!/\.(png|svg)$/.test(imagePath)) {
-                        console.log(`original: ${_}`);
-                        return _;
-                    }
-                    const repoLocation = path.join(src, imagePath);
-                    const absoluteLocation = path.join(REPO_ROOT_PATH, repoLocation);
-                    if (!fs.existsSync(absoluteLocation)) {
-                        const message = `Invalid amd image url in file ${sourceFile.path}: ${imagePath}`;
-                        console.log(message);
-                        throw new Error(message);
-                    }
-                    const fileContents = fs.readFileSync(absoluteLocation);
-                    const mime = /\.svg$/.test(imagePath) ? 'image/svg+xml' : 'image/png';
-                    // Mark the file as inlined so we don't ship it by itself
-                    result.cssInlinedResources.push(repoLocation);
-                    return `("data:${mime};base64,${fileContents.toString('base64')}")`;
-                });
-            }
-        }
-    }
-    return result;
-}
 /**
  * Wrap around uglify and allow the preserveComments function
  * to have a file "context" to include our copyright only once per file.
diff --git a/build/lib/optimize.ts b/build/lib/optimize.ts
index 46189514c30..0d6bead1d53 100644
--- a/build/lib/optimize.ts
+++ b/build/lib/optimize.ts
@@ -6,7 +6,6 @@
 'use strict';
 
 import * as es from 'event-stream';
-import * as fs from 'fs';
 import * as gulp from 'gulp';
 import * as concat from 'gulp-concat';
 import * as minifyCSS from 'gulp-cssnano';
@@ -160,10 +159,6 @@ export interface IOptimizeTaskOpts {
 	 * (emit bundleInfo.json file)
 	 */
 	bundleInfo: boolean;
-	/**
-	 * replace calls to `registerAndGetAmdImageURL` with data uris
-	 */
-	inlineAmdImages: boolean;
 	/**
 	 * (out folder name)
 	 */
@@ -197,14 +192,6 @@ export function optimizeTask(opts: IOptimizeTaskOpts): () => NodeJS.ReadWriteStr
 		bundle.bundle(entryPoints, loaderConfig, function (err, result) {
 			if (err || !result) { return bundlesStream.emit('error', JSON.stringify(err)); }
 
-			if (opts.inlineAmdImages) {
-				try {
-					result = inlineAmdImages(src, result);
-				} catch (err) {
-					return bundlesStream.emit('error', JSON.stringify(err));
-				}
-			}
-
 			toBundleStream(src, bundledFileHeader, result.files).pipe(bundlesStream);
 
 			// Remove css inlined resources
@@ -249,42 +236,6 @@ export function optimizeTask(opts: IOptimizeTaskOpts): () => NodeJS.ReadWriteStr
 	};
 }
 
-function inlineAmdImages(src: string, result: bundle.IBundleResult): bundle.IBundleResult {
-	for (const outputFile of result.files) {
-		for (const sourceFile of outputFile.sources) {
-			if (sourceFile.path && /\.js$/.test(sourceFile.path)) {
-				sourceFile.contents = sourceFile.contents.replace(/\([^.]+\.registerAndGetAmdImageURL\(([^)]+)\)\)/g, (_, m0) => {
-					let imagePath = m0;
-					// remove `` or ''
-					if ((imagePath.charAt(0) === '`' && imagePath.charAt(imagePath.length - 1) === '`')
-						|| (imagePath.charAt(0) === '\'' && imagePath.charAt(imagePath.length - 1) === '\'')) {
-						imagePath = imagePath.substr(1, imagePath.length - 2);
-					}
-					if (!/\.(png|svg)$/.test(imagePath)) {
-						console.log(`original: ${_}`);
-						return _;
-					}
-					const repoLocation = path.join(src, imagePath);
-					const absoluteLocation = path.join(REPO_ROOT_PATH, repoLocation);
-					if (!fs.existsSync(absoluteLocation)) {
-						const message = `Invalid amd image url in file ${sourceFile.path}: ${imagePath}`;
-						console.log(message);
-						throw new Error(message);
-					}
-					const fileContents = fs.readFileSync(absoluteLocation);
-					const mime = /\.svg$/.test(imagePath) ? 'image/svg+xml' : 'image/png';
-
-					// Mark the file as inlined so we don't ship it by itself
-					result.cssInlinedResources.push(repoLocation);
-
-					return `("data:${mime};base64,${fileContents.toString('base64')}")`;
-				});
-			}
-		}
-	}
-	return result;
-}
-
 declare class FileWithCopyright extends VinylFile {
 	public __hasOurCopyright: boolean;
 }
diff --git a/src/vs/base/common/amd.ts b/src/vs/base/common/amd.ts
index b44b19ddd0d..ebea36794d0 100644
--- a/src/vs/base/common/amd.ts
+++ b/src/vs/base/common/amd.ts
@@ -12,12 +12,3 @@ export function getPathFromAmdModule(requirefn: typeof require, relativePath: st
 export function getUriFromAmdModule(requirefn: typeof require, relativePath: string): URI {
 	return URI.parse(requirefn.toUrl(relativePath));
 }
-
-/**
- * Reference a resource that might be inlined.
- * Do not inline icons that will be used by the native mac touchbar.
- * Do not rename this method unless you adopt the build scripts.
- */
-export function registerAndGetAmdImageURL(absolutePath: string): string {
-	return require.toUrl(absolutePath);
-}