2 files changed, 60 insertions, 15 deletions

diff --git a/packages/cli/src/ui/hooks/useFolderTrust.test.ts b/packages/cli/src/ui/hooks/useFolderTrust.test.ts
index 3103cab4..54e7fe86 100644
--- a/packages/cli/src/ui/hooks/useFolderTrust.test.ts
+++ b/packages/cli/src/ui/hooks/useFolderTrust.test.ts
@@ -82,7 +82,9 @@ describe('useFolderTrust', () => {
   });
 
   it('should handle TRUST_FOLDER choice', () => {
-    isWorkspaceTrustedSpy.mockReturnValue(undefined);
+    isWorkspaceTrustedSpy
+      .mockReturnValueOnce(undefined)
+      .mockReturnValueOnce(true);
     const { result } = renderHook(() =>
       useFolderTrust(mockSettings, onTrustChange),
     );
@@ -102,12 +104,13 @@ describe('useFolderTrust', () => {
   });
 
   it('should handle TRUST_PARENT choice', () => {
-    isWorkspaceTrustedSpy.mockReturnValue(undefined);
+    isWorkspaceTrustedSpy
+      .mockReturnValueOnce(undefined)
+      .mockReturnValueOnce(true);
     const { result } = renderHook(() =>
       useFolderTrust(mockSettings, onTrustChange),
     );
 
-    isWorkspaceTrustedSpy.mockReturnValue(true);
     act(() => {
       result.current.handleFolderTrustSelect(FolderTrustChoice.TRUST_PARENT);
     });
@@ -120,13 +123,14 @@ describe('useFolderTrust', () => {
     expect(onTrustChange).toHaveBeenLastCalledWith(true);
   });
 
-  it('should handle DO_NOT_TRUST choice', () => {
-    isWorkspaceTrustedSpy.mockReturnValue(undefined);
+  it('should handle DO_NOT_TRUST choice and trigger restart', () => {
+    isWorkspaceTrustedSpy
+      .mockReturnValueOnce(undefined)
+      .mockReturnValueOnce(false);
     const { result } = renderHook(() =>
       useFolderTrust(mockSettings, onTrustChange),
     );
 
-    isWorkspaceTrustedSpy.mockReturnValue(false);
     act(() => {
       result.current.handleFolderTrustSelect(FolderTrustChoice.DO_NOT_TRUST);
     });
@@ -135,8 +139,9 @@ describe('useFolderTrust', () => {
       '/test/path',
       TrustLevel.DO_NOT_TRUST,
     );
-    expect(result.current.isFolderTrustDialogOpen).toBe(false);
     expect(onTrustChange).toHaveBeenLastCalledWith(false);
+    expect(result.current.isRestarting).toBe(true);
+    expect(result.current.isFolderTrustDialogOpen).toBe(true);
   });
 
   it('should do nothing for default choice', () => {
@@ -156,4 +161,34 @@ describe('useFolderTrust', () => {
     expect(result.current.isFolderTrustDialogOpen).toBe(true);
     expect(onTrustChange).toHaveBeenCalledWith(undefined);
   });
+
+  it('should set isRestarting to true when trust status changes from false to true', () => {
+    isWorkspaceTrustedSpy.mockReturnValueOnce(false).mockReturnValueOnce(true); // Initially untrusted, then trusted
+    const { result } = renderHook(() =>
+      useFolderTrust(mockSettings, onTrustChange),
+    );
+
+    act(() => {
+      result.current.handleFolderTrustSelect(FolderTrustChoice.TRUST_FOLDER);
+    });
+
+    expect(result.current.isRestarting).toBe(true);
+    expect(result.current.isFolderTrustDialogOpen).toBe(true); // Dialog should stay open
+  });
+
+  it('should not set isRestarting to true when trust status does not change', () => {
+    isWorkspaceTrustedSpy
+      .mockReturnValueOnce(undefined)
+      .mockReturnValueOnce(true); // Initially undefined, then trust
+    const { result } = renderHook(() =>
+      useFolderTrust(mockSettings, onTrustChange),
+    );
+
+    act(() => {
+      result.current.handleFolderTrustSelect(FolderTrustChoice.TRUST_FOLDER);
+    });
+
+    expect(result.current.isRestarting).toBe(false);
+    expect(result.current.isFolderTrustDialogOpen).toBe(false); // Dialog should close
+  });
 });
diff --git a/packages/cli/src/ui/hooks/useFolderTrust.ts b/packages/cli/src/ui/hooks/useFolderTrust.ts
index 28b82b30..c13d9e6e 100644
--- a/packages/cli/src/ui/hooks/useFolderTrust.ts
+++ b/packages/cli/src/ui/hooks/useFolderTrust.ts
@@ -20,6 +20,7 @@ export const useFolderTrust = (
 ) => {
   const [isTrusted, setIsTrusted] = useState<boolean | undefined>(undefined);
   const [isFolderTrustDialogOpen, setIsFolderTrustDialogOpen] = useState(false);
+  const [isRestarting, setIsRestarting] = useState(false);
 
   const { folderTrust, folderTrustFeature } = settings.merged;
   useEffect(() => {
@@ -38,6 +39,8 @@ export const useFolderTrust = (
       const cwd = process.cwd();
       let trustLevel: TrustLevel;
 
+      const wasTrusted = isTrusted ?? true;
+
       switch (choice) {
         case FolderTrustChoice.TRUST_FOLDER:
           trustLevel = TrustLevel.TRUST_FOLDER;
@@ -53,20 +56,27 @@ export const useFolderTrust = (
       }
 
       trustedFolders.setValue(cwd, trustLevel);
-      const trusted = isWorkspaceTrusted({
-        folderTrust,
-        folderTrustFeature,
-      } as Settings);
-      setIsTrusted(trusted);
-      setIsFolderTrustDialogOpen(false);
-      onTrustChange(trusted);
+      const newIsTrusted =
+        trustLevel === TrustLevel.TRUST_FOLDER ||
+        trustLevel === TrustLevel.TRUST_PARENT;
+      setIsTrusted(newIsTrusted);
+      onTrustChange(newIsTrusted);
+
+      const needsRestart = wasTrusted !== newIsTrusted;
+      if (needsRestart) {
+        setIsRestarting(true);
+        setIsFolderTrustDialogOpen(true);
+      } else {
+        setIsFolderTrustDialogOpen(false);
+      }
     },
-    [onTrustChange, folderTrust, folderTrustFeature],
+    [onTrustChange, isTrusted],
   );
 
   return {
     isTrusted,
     isFolderTrustDialogOpen,
     handleFolderTrustSelect,
+    isRestarting,
   };
 };