There is a vsix package developed by another developer, which needs some modifications. I tried to open the vsix file in VS code itself(latest version), but it is opening the binaries.
Would it be possible to open the vsix package so that I can modify? If yes, then how?
As Simon mentioned, a .VSIX is just a .ZIP file containing the files that make up the extension. While you can rename it to a .zip file, modify, re-zip and rename to .VSIX; You can really only edit the text files packaged into the .VSIX file. So the ability to modify the extension is going to be pretty limited, depending on what is actually in the .VSIX payload. You'd obviously need the source projects to rebuild any of the package's binaries.