If i mosh into a machine using Terminal on Mac OX Lion (shell is xterm-256color), and generate a lot of fast screen output (such as ls -l in large directories), Terminal does not have all the output in its scrollback buffer. This loss of history is kind of a deal-breaker for my use of mosh.
Yes, mosh 1.2 only synchronizes the state of the terminal (not the scrollback). For now, you can work around this by running screen or tmux on the server side (or less or more when you run a command with long output).
We will have complete scrollback in mosh 1.3; you can follow our progress in #2. Closing as duplicate.
Running screen or tmux only lets you scroll back using the keyboard, as far as I can tell. It doesn't get you scrolling with two-finger gestures on the trackpad or using a mouse. I'll go follow issue #2 now, but I wasn't sure if this specific limitation applied to #2 as well as this issue.
And like a few other commenters, this is the only issue preventing me from using mosh instead of ssh full-time. Other than this, it's awesome, and the local echo makes me not hate working on EC2 instances across the country. :)