diff --git a/src/shared/agent-status-osc.test.ts b/src/shared/agent-status-osc.test.ts
index 4a0711cc426..5b7c0ff69d1 100644
--- a/src/shared/agent-status-osc.test.ts
+++ b/src/shared/agent-status-osc.test.ts
@@ -2,6 +2,17 @@ import { describe, expect, it } from 'vitest'
 import { createAgentStatusOscProcessor } from './agent-status-osc'
 
 describe('createAgentStatusOscProcessor', () => {
+  it('keeps ordinary chunks on the clean-data identity path', () => {
+    const process = createAgentStatusOscProcessor()
+    const data = 'plain terminal output\r\nwith ANSI-like text [0m\n'
+
+    const result = process(data)
+
+    expect(result.cleanData).toBe(data)
+    expect(result.payloads).toEqual([])
+    expect(result.lastPayloadCleanOffset).toBeNull()
+  })
+
   it('strips OSC 9999 payloads from terminal data and returns parsed statuses', () => {
     const process = createAgentStatusOscProcessor()
 
@@ -35,4 +46,48 @@ describe('createAgentStatusOscProcessor', () => {
     ])
     expect(result.lastPayloadCleanOffset).toBe(0)
   })
+
+  it('retains a marker prefix split across chunks without leaking it as output', () => {
+    const process = createAgentStatusOscProcessor()
+
+    const first = 'before\x1b]99'
+    expect(process(first)).toMatchObject({
+      cleanData: 'before',
+      payloads: [],
+      lastPayloadCleanOffset: null
+    })
+
+    const result = process('99;{"state":"working","prompt":"split"}\x07after')
+
+    expect(result.cleanData).toBe('after')
+    expect(result.payloads).toEqual([{ state: 'working', prompt: 'split' }])
+    expect(result.lastPayloadCleanOffset).toBe(0)
+  })
+
+  it('retains an unterminated OSC 9999 payload until its terminator arrives', () => {
+    const process = createAgentStatusOscProcessor()
+
+    expect(process('before\x1b]9999;{"state":"working","prompt":"par')).toMatchObject({
+      cleanData: 'before',
+      payloads: [],
+      lastPayloadCleanOffset: null
+    })
+
+    const result = process('tial"}\x1b\\after')
+
+    expect(result.cleanData).toBe('after')
+    expect(result.payloads).toEqual([{ state: 'working', prompt: 'partial' }])
+    expect(result.lastPayloadCleanOffset).toBe(0)
+  })
+
+  it('does not treat malformed or unrelated control data as an OSC status marker', () => {
+    const process = createAgentStatusOscProcessor()
+    const data = '\x1b[31mwarning\x07\x1b]999x\n'
+
+    const result = process(data)
+
+    expect(result.cleanData).toBe(data)
+    expect(result.payloads).toEqual([])
+    expect(result.lastPayloadCleanOffset).toBeNull()
+  })
 })
diff --git a/src/shared/agent-status-osc.ts b/src/shared/agent-status-osc.ts
index 39f9703bf85..75036888dbc 100644
--- a/src/shared/agent-status-osc.ts
+++ b/src/shared/agent-status-osc.ts
@@ -3,6 +3,22 @@ import { parseAgentStatusPayload } from './agent-status-types'
 
 const OSC_AGENT_STATUS_PREFIX = '\x1b]9999;'
 
+/** Return a suffix that can only be the beginning of an OSC 9999 marker. */
+function findAgentStatusPrefixCarry(data: string): string {
+  const lastChar = data.charCodeAt(data.length - 1)
+  if (lastChar !== 0x1b && lastChar !== 0x5d && lastChar !== 0x39 && lastChar !== 0x3b) {
+    return ''
+  }
+  const maxCarryLength = Math.min(data.length, OSC_AGENT_STATUS_PREFIX.length - 1)
+  for (let length = maxCarryLength; length > 0; length -= 1) {
+    const suffix = data.slice(data.length - length)
+    if (OSC_AGENT_STATUS_PREFIX.startsWith(suffix)) {
+      return suffix
+    }
+  }
+  return ''
+}
+
 export type ProcessedAgentStatusChunk = {
   cleanData: string
   payloads: ParsedAgentStatusPayload[]
@@ -37,6 +53,22 @@ export function createAgentStatusOscProcessor(): (data: string) => ProcessedAgen
   let pending = ''
 
   return (data: string): ProcessedAgentStatusChunk => {
+    // Ordinary terminal output is by far the common case. Keep it on the
+    // identity path unless the chunk ends with a split OSC marker; this avoids
+    // rebuilding a clean-data string for every PTY frame.
+    if (pending.length === 0 && !data.includes(OSC_AGENT_STATUS_PREFIX)) {
+      const carry = findAgentStatusPrefixCarry(data)
+      if (carry.length === 0) {
+        return { cleanData: data, payloads: [], lastPayloadCleanOffset: null }
+      }
+      pending = carry
+      return {
+        cleanData: data.slice(0, data.length - carry.length),
+        payloads: [],
+        lastPayloadCleanOffset: null
+      }
+    }
+
     const combined = pending + data
     pending = ''
 
@@ -49,17 +81,10 @@ export function createAgentStatusOscProcessor(): (data: string) => ProcessedAgen
       const start = combined.indexOf(OSC_AGENT_STATUS_PREFIX, cursor)
       if (start === -1) {
         const tail = combined.slice(cursor)
-        const prefixLen = OSC_AGENT_STATUS_PREFIX.length
-        let partialPrefixLen = 0
-        for (let k = Math.min(prefixLen - 1, tail.length); k > 0; k--) {
-          if (tail.endsWith(OSC_AGENT_STATUS_PREFIX.slice(0, k))) {
-            partialPrefixLen = k
-            break
-          }
-        }
-        if (partialPrefixLen > 0) {
-          cleanData += tail.slice(0, tail.length - partialPrefixLen)
-          pending = tail.slice(tail.length - partialPrefixLen)
+        const carry = findAgentStatusPrefixCarry(tail)
+        if (carry.length > 0) {
+          cleanData += tail.slice(0, tail.length - carry.length)
+          pending = carry
         } else {
           cleanData += tail
         }