To use the GitHub CLI (a.k.a. gh) on devcontainer, you need to pass credentials for that.

If you run gh auth login on the host side, the credentials will be stored at ~/.config/gh/hosts.yml, so mounting it on the container side will work.

Maybe it can be difficult to include this setting in docker-compose.yml since it is the developer's preference whether to use gh and devcontainer or not. In such case, it would be nice to add that setting to docker-compose.override.yml, and ignore these files from Git.

# docker-compose.override.yml
services:
  rails:
    volumes:
      - ~/.config/gh/hosts.yml:/root/.config/gh/hosts.yml

# .gitignore or .git/info/exclude
docker-compose.override.yml
.devcontainer/devcontainer.json

Normally, docker-compose command will automatically merge docker-compose.override.yml into docker-compose.yml, but in this case you need to specify it explicitly as follows:

# .devcontainer/devcontainer.json
{
  "name": "Rails",
  "dockerComposeFile": [
    "../docker-compose.yml",
    "../docker-compose.override.yml"
  ],
  "service": "rails",
  "workspaceFolder": "/workspace",
  "runServices": ["rails"]
}