Hi @TracyLiang ,
Based on your description, Do you want to allow intranet zone file URL links from Microsoft Edge to open in windows file explorer? If this is the case, you need to configure this policy: Microsoft Edge Policies - IntranetFileLinksEnabled. If you disable or don't configure this policy, file URL links will not open.
Also you need to note that https://localhost/ is specifically blocked as an exception for allowed intranet zone hosts, while loopback addresses (127.0.0.*, [::1]) are treated as internet zone by default, and this policy works in Edge version 95 or later, you can check it.
Regards,
Xudong Peng
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