I've tried to add hook:

(add-hook 'dired-subtree-after-insert-hook #'diff-hl-dired-update)

But I got an error:

error in process sentinel: vc-exec-after: Unexpected process state

When dired-subtree expands a subdirectory, diff-hl-dired-update is called while a previous VC process is still running. The existing code calls kill-process, which triggers the VC sentinel (vc-exec-after) with an unexpected process state.

I'm not an elisp expert, but replacing kill-process with delete-process seems to fix this - would that be the correct approach here?

I've tried to add hook:

(add-hook 'dired-subtree-after-insert-hook #'diff-hl-dired-update)

But I got an error:

error in process sentinel: vc-exec-after: Unexpected process state

When dired-subtree expands a subdirectory, diff-hl-dired-update is called while a previous VC process is still running. The existing code calls kill-process, which triggers the VC sentinel (vc-exec-after) with an unexpected process state.

I'm not an elisp expert, but replacing kill-process with delete-process seems to fix this - would that be the correct approach here?

Resolved by introducing a diff-hl-dired--status state machine (nil -> running -> pending) instead of killing the process.
When diff-hl-dired-update is called while a VC process is already running, it transitions to pending and returns early. When the running process completes, it checks the state and schedules a retry via run-at-time. This way N concurrent calls collapse into a single retry after the current process finishes.

Also moved diff-hl-dired-clear from diff-hl-dired-update to diff-hl-dired-highlight-items - clearing overlays right before redrawing avoids the flicker window between clear and async callback.