feat(coding-agent): add configurable chat padding

packages/coding-agent/CHANGELOG.md

@@ -2,6 +2,10 @@
 
 ## [Unreleased]
 
+### Added
+
+- Added `transcriptIndent` and `toolIndent` settings to configure interactive transcript and tool/message indentation.
+
 ### Fixed
 
 - Fixed `--session` and `SessionManager.open()` to reject non-empty invalid session files without overwriting them ([#6002](https://github.com/earendil-works/pi/issues/6002)).

packages/coding-agent/docs/extensions.md

@@ -2074,6 +2074,7 @@ pi.registerTool({
 - `lastComponent` - the previously returned component for that slot, if any
 - `invalidate()` - request a rerender of this tool row
 - `toolCallId`, `cwd`, `executionStarted`, `argsComplete`, `isPartial`, `expanded`, `showImages`, `isError`
+- `toolIndent` - current tool/message indentation in terminal columns; default shells apply it automatically, self-shell renderers can opt in (use `context.toolIndent ?? 1`)
 
 Use `context.state` for cross-slot shared state. Keep slot-local caches on the returned component instance when you want to reuse and mutate the same component across renders.
 
@@ -2154,6 +2155,7 @@ Custom editors and `ctx.ui.custom()` components receive `keybindings: Keybinding
 #### Best Practices
 
 - Use `Text` with padding `(0, 0)`. The default Box handles padding.
+- Use `context.toolIndent` only when `renderShell: "self"` needs to align with the user's tool indentation setting.
 - Use `\n` for multi-line content.
 - Handle `isPartial` for streaming progress.
 - Support `expanded` for detail on demand.

packages/coding-agent/docs/settings.md

@@ -60,6 +60,8 @@ Use `/trust` in interactive mode to save a project trust decision for future ses
 | `doubleEscapeAction` | string | `"tree"` | Action for double-escape: `"tree"`, `"fork"`, or `"none"` |
 | `treeFilterMode` | string | `"default"` | Default filter for `/tree`: `"default"`, `"no-tools"`, `"user-only"`, `"labeled-only"`, `"all"` |
 | `editorPaddingX` | number | `0` | Horizontal padding for input editor (0-3) |
+| `transcriptIndent` | number | `1` | Horizontal padding for assistant transcript text (0-4) |
+| `toolIndent` | number | `1` | Horizontal padding for tool and message blocks (0-4) |
 | `autocompleteMaxVisible` | number | `5` | Max visible items in autocomplete dropdown (3-20) |
 | `showHardwareCursor` | boolean | `false` | Show the terminal cursor while TUI positions it for IME support |
 

packages/coding-agent/src/core/agent-session.ts

@@ -3034,6 +3034,7 @@ export class AgentSession {
 			getToolDefinition: (name) => this.getToolDefinition(name),
 			theme,
 			cwd: this.sessionManager.getCwd(),
+			toolIndent: this.settingsManager.getToolIndent(),
 		});
 
 		return await exportSessionToHtml(this.sessionManager, this.state, {

packages/coding-agent/src/core/export-html/tool-renderer.ts

@@ -20,6 +20,8 @@ export interface ToolHtmlRendererDeps {
 	cwd: string;
 	/** Terminal width for rendering (default: 100) */
 	width?: number;
+	/** Tool indentation to expose to custom tool renderers (default: 1) */
+	toolIndent?: number;
 }
 
 export interface ToolHtmlRenderer {
@@ -56,7 +58,7 @@ function trimRenderedResultLines(lines: string[]): string[] {
 }
 
 export function createToolHtmlRenderer(deps: ToolHtmlRendererDeps): ToolHtmlRenderer {
-	const { getToolDefinition, theme, cwd, width = 100 } = deps;
+	const { getToolDefinition, theme, cwd, width = 100, toolIndent = 1 } = deps;
 
 	const renderedCallComponents = new Map<string, Component>();
 	const renderedResultComponents = new Map<string, Component>();
@@ -91,6 +93,7 @@ export function createToolHtmlRenderer(deps: ToolHtmlRendererDeps): ToolHtmlRend
 			isPartial,
 			expanded,
 			showImages: false,
+			toolIndent,
 			isError,
 		};
 	};

packages/coding-agent/src/core/extensions/types.ts

@@ -425,6 +425,8 @@ export interface ToolRenderContext<TState = any, TArgs = any> {
 	expanded: boolean;
 	/** Whether inline images are currently shown in the TUI. */
 	showImages: boolean;
+	/** Current tool/message indentation in terminal columns. Core-owned shells apply it automatically. */
+	toolIndent?: number;
 	/** Whether the current result is an error. */
 	isError: boolean;
 }

packages/coding-agent/src/core/settings-manager.ts

@@ -62,6 +62,15 @@ export type DefaultProjectTrust = "ask" | "always" | "never";
 
 export type TransportSetting = Transport;
 
+export const INDENT_VALUES = [0, 1, 2, 3, 4] as const;
+
+function normalizeIndent(value: unknown): number {
+	if (typeof value !== "number" || !Number.isInteger(value)) {
+		return 1;
+	}
+	return INDENT_VALUES.includes(value as (typeof INDENT_VALUES)[number]) ? value : 1;
+}
+
 /**
  * Package source for npm/git packages.
  * - String form: load all resources from the package
@@ -114,6 +123,8 @@ export interface Settings {
 	editorPaddingX?: number; // Horizontal padding for input editor (default: 0)
 	autocompleteMaxVisible?: number; // Max visible items in autocomplete dropdown (default: 5)
 	showHardwareCursor?: boolean; // Show terminal cursor while still positioning it for IME
+	transcriptIndent?: number; // Horizontal padding for assistant transcript text (default: 1; allowed: 0-4)
+	toolIndent?: number; // Horizontal padding for tool and message blocks (default: 1; allowed: 0-4)
 	markdown?: MarkdownSettings;
 	warnings?: WarningSettings;
 	sessionDir?: string; // Custom session storage directory (same format as --session-dir CLI flag)
@@ -1169,6 +1180,26 @@ export class SettingsManager {
 		this.save();
 	}
 
+	getTranscriptIndent(): number {
+		return normalizeIndent(this.settings.transcriptIndent);
+	}
+
+	setTranscriptIndent(indent: number): void {
+		this.globalSettings.transcriptIndent = normalizeIndent(indent);
+		this.markModified("transcriptIndent");
+		this.save();
+	}
+
+	getToolIndent(): number {
+		return normalizeIndent(this.settings.toolIndent);
+	}
+
+	setToolIndent(indent: number): void {
+		this.globalSettings.toolIndent = normalizeIndent(indent);
+		this.markModified("toolIndent");
+		this.save();
+	}
+
 	getAutocompleteMaxVisible(): number {
 		return this.settings.autocompleteMaxVisible ?? 5;
 	}

packages/coding-agent/src/core/tools/edit.ts

@@ -144,8 +144,8 @@ type EditCallRenderComponent = Box & {
 	settledError?: boolean;
 };
 
-function createEditCallRenderComponent(): EditCallRenderComponent {
-	return Object.assign(new Box(1, 1, (text: string) => text), {
+function createEditCallRenderComponent(toolIndent: number): EditCallRenderComponent {
+	return Object.assign(new Box(toolIndent, 1, (text: string) => text), {
 		preview: undefined as EditPreview | undefined,
 		previewArgsKey: undefined as string | undefined,
 		previewPending: false,
@@ -153,7 +153,11 @@ function createEditCallRenderComponent(): EditCallRenderComponent {
 	});
 }
 
-function getEditCallRenderComponent(state: EditRenderState, lastComponent: unknown): EditCallRenderComponent {
+function getEditCallRenderComponent(
+	state: EditRenderState,
+	lastComponent: unknown,
+	toolIndent: number,
+): EditCallRenderComponent {
 	if (lastComponent instanceof Box) {
 		const component = lastComponent as EditCallRenderComponent;
 		state.callComponent = component;
@@ -162,7 +166,7 @@ function getEditCallRenderComponent(state: EditRenderState, lastComponent: unkno
 	if (state.callComponent) {
 		return state.callComponent;
 	}
-	const component = createEditCallRenderComponent();
+	const component = createEditCallRenderComponent(toolIndent);
 	state.callComponent = component;
 	return component;
 }
@@ -361,7 +365,8 @@ export function createEditToolDefinition(
 			});
 		},
 		renderCall(args, theme, context) {
-			const component = getEditCallRenderComponent(context.state, context.lastComponent);
+			const toolIndent = context.toolIndent ?? 1;
+			const component = getEditCallRenderComponent(context.state, context.lastComponent, toolIndent);
 			const previewInput = getRenderablePreviewInput(args as RenderableEditArgs | undefined);
 			const argsKey = previewInput
 				? JSON.stringify({ path: previewInput.path, edits: previewInput.edits })
@@ -426,7 +431,7 @@ export function createEditToolDefinition(
 				return component;
 			}
 			component.addChild(new Spacer(1));
-			component.addChild(new Text(output, 1, 0));
+			component.addChild(new Text(output, context.toolIndent ?? 1, 0));
 			return component;
 		},
 	};

packages/coding-agent/src/modes/interactive/components/armin.ts

@@ -68,9 +68,11 @@ export class ArminComponent implements Component {
 	private cachedWidth = 0;
 	private gridVersion = 0;
 	private cachedVersion = -1;
+	private toolIndent: number;
 
-	constructor(ui: TUI) {
+	constructor(ui: TUI, toolIndent = 1) {
 		this.ui = ui;
+		this.toolIndent = toolIndent;
 		this.effect = EFFECTS[Math.floor(Math.random() * EFFECTS.length)];
 		this.finalGrid = buildFinalGrid();
 		this.currentGrid = this.createEmptyGrid();
@@ -88,20 +90,21 @@ export class ArminComponent implements Component {
 			return this.cachedLines;
 		}
 
-		const padding = 1;
-		const availableWidth = width - padding;
+		const padding = this.toolIndent;
+		const leftPadding = " ".repeat(padding);
+		const availableWidth = Math.max(0, width - padding);
 
 		this.cachedLines = this.currentGrid.map((row) => {
 			// Clip row to available width before applying color
 			const clipped = row.slice(0, availableWidth).join("");
 			const padRight = Math.max(0, width - padding - clipped.length);
-			return ` ${theme.fg("accent", clipped)}${" ".repeat(padRight)}`;
+			return `${leftPadding}${theme.fg("accent", clipped)}${" ".repeat(padRight)}`;
 		});
 
 		// Add "ARMIN SAYS HI" at the end
 		const message = "ARMIN SAYS HI";
 		const msgPadRight = Math.max(0, width - padding - message.length);
-		this.cachedLines.push(` ${theme.fg("accent", message)}${" ".repeat(msgPadRight)}`);
+		this.cachedLines.push(`${leftPadding}${theme.fg("accent", message)}${" ".repeat(msgPadRight)}`);
 
 		this.cachedWidth = width;
 		this.cachedVersion = this.gridVersion;

packages/coding-agent/src/modes/interactive/components/assistant-message.ts

@@ -14,6 +14,7 @@ export class AssistantMessageComponent extends Container {
 	private hideThinkingBlock: boolean;
 	private markdownTheme: MarkdownTheme;
 	private hiddenThinkingLabel: string;
+	private transcriptIndent: number;
 	private lastMessage?: AssistantMessage;
 	private hasToolCalls = false;
 
@@ -22,12 +23,14 @@ export class AssistantMessageComponent extends Container {
 		hideThinkingBlock = false,
 		markdownTheme: MarkdownTheme = getMarkdownTheme(),
 		hiddenThinkingLabel = "Thinking...",
+		transcriptIndent = 1,
 	) {
 		super();
 
 		this.hideThinkingBlock = hideThinkingBlock;
 		this.markdownTheme = markdownTheme;
 		this.hiddenThinkingLabel = hiddenThinkingLabel;
+		this.transcriptIndent = transcriptIndent;
 
 		// Container for text/thinking content
 		this.contentContainer = new Container();
@@ -90,7 +93,9 @@ export class AssistantMessageComponent extends Container {
 			if (content.type === "text" && content.text.trim()) {
 				// Assistant text messages with no background - trim the text
 				// Set paddingY=0 to avoid extra spacing before tool executions
-				this.contentContainer.addChild(new Markdown(content.text.trim(), 1, 0, this.markdownTheme));
+				this.contentContainer.addChild(
+					new Markdown(content.text.trim(), this.transcriptIndent, 0, this.markdownTheme),
+				);
 			} else if (content.type === "thinking" && content.thinking.trim()) {
 				// Add spacing only when another visible assistant content block follows.
 				// This avoids a superfluous blank line before separately-rendered tool execution blocks.
@@ -101,7 +106,7 @@ export class AssistantMessageComponent extends Container {
 				if (this.hideThinkingBlock) {
 					// Show static thinking label when hidden
 					this.contentContainer.addChild(
-						new Text(theme.italic(theme.fg("thinkingText", this.hiddenThinkingLabel)), 1, 0),
+						new Text(theme.italic(theme.fg("thinkingText", this.hiddenThinkingLabel)), this.transcriptIndent, 0),
 					);
 					if (hasVisibleContentAfter) {
 						this.contentContainer.addChild(new Spacer(1));
@@ -109,7 +114,7 @@ export class AssistantMessageComponent extends Container {
 				} else {
 					// Thinking traces in thinkingText color, italic
 					this.contentContainer.addChild(
-						new Markdown(content.thinking.trim(), 1, 0, this.markdownTheme, {
+						new Markdown(content.thinking.trim(), this.transcriptIndent, 0, this.markdownTheme, {
 							color: (text: string) => theme.fg("thinkingText", text),
 							italic: true,
 						}),
@@ -134,7 +139,7 @@ export class AssistantMessageComponent extends Container {
 						"error",
 						"Error: Model stopped because it reached the maximum output token limit. The response may be incomplete.",
 					),
-					1,
+					this.transcriptIndent,
 					0,
 				),
 			);
@@ -145,11 +150,11 @@ export class AssistantMessageComponent extends Container {
 						? message.errorMessage
 						: "Operation aborted";
 				this.contentContainer.addChild(new Spacer(1));
-				this.contentContainer.addChild(new Text(theme.fg("error", abortMessage), 1, 0));
+				this.contentContainer.addChild(new Text(theme.fg("error", abortMessage), this.transcriptIndent, 0));
 			} else if (message.stopReason === "error") {
 				const errorMsg = message.errorMessage || "Unknown error";
 				this.contentContainer.addChild(new Spacer(1));
-				this.contentContainer.addChild(new Text(theme.fg("error", `Error: ${errorMsg}`), 1, 0));
+				this.contentContainer.addChild(new Text(theme.fg("error", `Error: ${errorMsg}`), this.transcriptIndent, 0));
 			}
 		}
 	}

packages/coding-agent/src/modes/interactive/components/bash-execution.ts

@@ -28,10 +28,12 @@ export class BashExecutionComponent extends Container {
 	private fullOutputPath?: string;
 	private expanded = false;
 	private contentContainer: Container;
+	private toolIndent: number;
 
-	constructor(command: string, ui: TUI, excludeFromContext = false) {
+	constructor(command: string, ui: TUI, excludeFromContext = false, toolIndent = 1) {
 		super();
 		this.command = command;
+		this.toolIndent = toolIndent;
 
 		// Use dim border for excluded-from-context commands (!! prefix)
 		const colorKey = excludeFromContext ? "dim" : "bashMode";
@@ -48,7 +50,7 @@ export class BashExecutionComponent extends Container {
 		this.addChild(this.contentContainer);
 
 		// Command header
-		const header = new Text(theme.fg(colorKey, theme.bold(`$ ${command}`)), 1, 0);
+		const header = new Text(theme.fg(colorKey, theme.bold(`$ ${command}`)), this.toolIndent, 0);
 		this.contentContainer.addChild(header);
 
 		// Loader
@@ -135,7 +137,7 @@ export class BashExecutionComponent extends Container {
 		this.contentContainer.clear();
 
 		// Command header
-		const header = new Text(theme.fg("bashMode", theme.bold(`$ ${this.command}`)), 1, 0);
+		const header = new Text(theme.fg("bashMode", theme.bold(`$ ${this.command}`)), this.toolIndent, 0);
 		this.contentContainer.addChild(header);
 
 		// Output
@@ -143,7 +145,7 @@ export class BashExecutionComponent extends Container {
 			if (this.expanded) {
 				// Show all lines
 				const displayText = availableLines.map((line) => theme.fg("muted", line)).join("\n");
-				this.contentContainer.addChild(new Text(`\n${displayText}`, 1, 0));
+				this.contentContainer.addChild(new Text(`\n${displayText}`, this.toolIndent, 0));
 			} else {
 				// Use shared visual truncation utility with width-aware caching
 				const styledOutput = previewLogicalLines.map((line) => theme.fg("muted", line)).join("\n");
@@ -153,7 +155,7 @@ export class BashExecutionComponent extends Container {
 				this.contentContainer.addChild({
 					render: (width: number) => {
 						if (cachedLines === undefined || cachedWidth !== width) {
-							const result = truncateToVisualLines(styledInput, PREVIEW_LINES, width, 1);
+							const result = truncateToVisualLines(styledInput, PREVIEW_LINES, width, this.toolIndent);
 							cachedLines = result.visualLines;
 							cachedWidth = width;
 						}
@@ -199,7 +201,7 @@ export class BashExecutionComponent extends Container {
 			}
 
 			if (statusParts.length > 0) {
-				this.contentContainer.addChild(new Text(`\n${statusParts.join("\n")}`, 1, 0));
+				this.contentContainer.addChild(new Text(`\n${statusParts.join("\n")}`, this.toolIndent, 0));
 			}
 		}
 	}

packages/coding-agent/src/modes/interactive/components/branch-summary-message.ts

@@ -12,8 +12,8 @@ export class BranchSummaryMessageComponent extends Box {
 	private message: BranchSummaryMessage;
 	private markdownTheme: MarkdownTheme;
 
-	constructor(message: BranchSummaryMessage, markdownTheme: MarkdownTheme = getMarkdownTheme()) {
-		super(1, 1, (t) => theme.bg("customMessageBg", t));
+	constructor(message: BranchSummaryMessage, markdownTheme: MarkdownTheme = getMarkdownTheme(), toolIndent = 1) {
+		super(toolIndent, 1, (t) => theme.bg("customMessageBg", t));
 		this.message = message;
 		this.markdownTheme = markdownTheme;
 		this.updateDisplay();

packages/coding-agent/src/modes/interactive/components/compaction-summary-message.ts

@@ -12,8 +12,8 @@ export class CompactionSummaryMessageComponent extends Box {
 	private message: CompactionSummaryMessage;
 	private markdownTheme: MarkdownTheme;
 
-	constructor(message: CompactionSummaryMessage, markdownTheme: MarkdownTheme = getMarkdownTheme()) {
-		super(1, 1, (t) => theme.bg("customMessageBg", t));
+	constructor(message: CompactionSummaryMessage, markdownTheme: MarkdownTheme = getMarkdownTheme(), toolIndent = 1) {
+		super(toolIndent, 1, (t) => theme.bg("customMessageBg", t));
 		this.message = message;
 		this.markdownTheme = markdownTheme;
 		this.updateDisplay();

packages/coding-agent/src/modes/interactive/components/custom-message.ts

@@ -21,6 +21,7 @@ export class CustomMessageComponent extends Container {
 		message: CustomMessage<unknown>,
 		customRenderer?: MessageRenderer,
 		markdownTheme: MarkdownTheme = getMarkdownTheme(),
+		toolIndent = 1,
 	) {
 		super();
 		this.message = message;
@@ -30,7 +31,7 @@ export class CustomMessageComponent extends Container {
 		this.addChild(new Spacer(1));
 
 		// Create box with purple background (used for default rendering)
-		this.box = new Box(1, 1, (t) => theme.bg("customMessageBg", t));
+		this.box = new Box(toolIndent, 1, (t) => theme.bg("customMessageBg", t));
 
 		this.rebuild();
 	}

packages/coding-agent/src/modes/interactive/components/earendil-announcement.ts

@@ -25,14 +25,17 @@ function loadImageBase64(): string | undefined {
 }
 
 export class EarendilAnnouncementComponent extends Container {
-	constructor() {
+	constructor(toolIndent = 1) {
 		super();
+		const addText = (content: string) => {
+			this.addChild(new Text(content, toolIndent, 0));
+		};
 
 		this.addChild(new DynamicBorder((text) => theme.fg("accent", text)));
-		this.addChild(new Text(theme.bold(theme.fg("accent", "pi has joined Earendil")), 1, 0));
+		addText(theme.bold(theme.fg("accent", "pi has joined Earendil")));
 		this.addChild(new Spacer(1));
-		this.addChild(new Text(theme.fg("muted", "Read the blog post:"), 1, 0));
-		this.addChild(new Text(theme.fg("mdLink", BLOG_URL), 1, 0));
+		addText(theme.fg("muted", "Read the blog post:"));
+		addText(theme.fg("mdLink", BLOG_URL));
 		this.addChild(new Spacer(1));
 
 		const imageBase64 = loadImageBase64();

packages/coding-agent/src/modes/interactive/components/settings-selector.ts

@@ -13,7 +13,7 @@ import {
 	Text,
 } from "@earendil-works/pi-tui";
 import { formatHttpIdleTimeoutMs, HTTP_IDLE_TIMEOUT_CHOICES } from "../../../core/http-dispatcher.ts";
-import type { DefaultProjectTrust, WarningSettings } from "../../../core/settings-manager.ts";
+import { type DefaultProjectTrust, INDENT_VALUES, type WarningSettings } from "../../../core/settings-manager.ts";
 import {
 	getSelectListTheme,
 	getSettingsListTheme,
@@ -71,6 +71,8 @@ export interface SettingsConfig {
 	treeFilterMode: "default" | "no-tools" | "user-only" | "labeled-only" | "all";
 	showHardwareCursor: boolean;
 	editorPaddingX: number;
+	transcriptIndent: number;
+	toolIndent: number;
 	autocompleteMaxVisible: number;
 	quietStartup: boolean;
 	defaultProjectTrust: DefaultProjectTrust;
@@ -100,6 +102,8 @@ export interface SettingsCallbacks {
 	onTreeFilterModeChange: (mode: "default" | "no-tools" | "user-only" | "labeled-only" | "all") => void;
 	onShowHardwareCursorChange: (enabled: boolean) => void;
 	onEditorPaddingXChange: (padding: number) => void;
+	onTranscriptIndentChange: (indent: number) => void;
+	onToolIndentChange: (indent: number) => void;
 	onAutocompleteMaxVisibleChange: (maxVisible: number) => void;
 	onQuietStartupChange: (enabled: boolean) => void;
 	onDefaultProjectTrustChange: (defaultProjectTrust: DefaultProjectTrust) => void;
@@ -676,9 +680,29 @@ export class SettingsSelectorComponent extends Container {
 			values: ["0", "1", "2", "3"],
 		});
 
-		// Autocomplete max visible toggle (insert after editor-padding)
+		// Transcript indent toggle (insert after editor-padding)
 		const editorPaddingIndex = items.findIndex((item) => item.id === "editor-padding");
 		items.splice(editorPaddingIndex + 1, 0, {
+			id: "transcript-indent",
+			label: "Transcript indent",
+			description: "Horizontal padding for assistant transcript text (0-4)",
+			currentValue: String(config.transcriptIndent),
+			values: INDENT_VALUES.map((value) => String(value)),
+		});
+
+		// Tool indent toggle (insert after transcript-indent)
+		const transcriptIndentIndex = items.findIndex((item) => item.id === "transcript-indent");
+		items.splice(transcriptIndentIndex + 1, 0, {
+			id: "tool-indent",
+			label: "Tool indent",
+			description: "Horizontal padding for tool and message blocks (0-4)",
+			currentValue: String(config.toolIndent),
+			values: INDENT_VALUES.map((value) => String(value)),
+		});
+
+		// Autocomplete max visible toggle (insert after tool-indent)
+		const toolIndentIndex = items.findIndex((item) => item.id === "tool-indent");
+		items.splice(toolIndentIndex + 1, 0, {
 			id: "autocomplete-max-visible",
 			label: "Autocomplete max items",
 			description: "Max visible items in autocomplete dropdown (3-20)",
@@ -782,6 +806,12 @@ export class SettingsSelectorComponent extends Container {
 					case "editor-padding":
 						callbacks.onEditorPaddingXChange(parseInt(newValue, 10));
 						break;
+					case "transcript-indent":
+						callbacks.onTranscriptIndentChange(parseInt(newValue, 10));
+						break;
+					case "tool-indent":
+						callbacks.onToolIndentChange(parseInt(newValue, 10));
+						break;
 					case "autocomplete-max-visible":
 						callbacks.onAutocompleteMaxVisibleChange(parseInt(newValue, 10));
 						break;

packages/coding-agent/src/modes/interactive/components/skill-invocation-message.ts

@@ -13,8 +13,8 @@ export class SkillInvocationMessageComponent extends Box {
 	private skillBlock: ParsedSkillBlock;
 	private markdownTheme: MarkdownTheme;
 
-	constructor(skillBlock: ParsedSkillBlock, markdownTheme: MarkdownTheme = getMarkdownTheme()) {
-		super(1, 1, (t) => theme.bg("customMessageBg", t));
+	constructor(skillBlock: ParsedSkillBlock, markdownTheme: MarkdownTheme = getMarkdownTheme(), toolIndent = 1) {
+		super(toolIndent, 1, (t) => theme.bg("customMessageBg", t));
 		this.skillBlock = skillBlock;
 		this.markdownTheme = markdownTheme;
 		this.updateDisplay();

packages/coding-agent/src/modes/interactive/components/tool-execution.ts

@@ -8,6 +8,7 @@ import { theme } from "../theme/theme.ts";
 export interface ToolExecutionOptions {
 	showImages?: boolean;
 	imageWidthCells?: number;
+	toolIndent?: number;
 }
 
 export class ToolExecutionComponent extends Container {
@@ -25,6 +26,7 @@ export class ToolExecutionComponent extends Container {
 	private expanded = false;
 	private showImages: boolean;
 	private imageWidthCells: number;
+	private toolIndent: number;
 	private isPartial = true;
 	private toolDefinition?: ToolDefinition<any, any>;
 	private builtInToolDefinition?: ToolDefinition<any, any>;
@@ -57,6 +59,7 @@ export class ToolExecutionComponent extends Container {
 		this.builtInToolDefinition = createAllToolDefinitions(cwd)[toolName as ToolName];
 		this.showImages = options.showImages ?? true;
 		this.imageWidthCells = options.imageWidthCells ?? 60;
+		this.toolIndent = options.toolIndent ?? 1;
 		this.ui = ui;
 		this.cwd = cwd;
 
@@ -65,8 +68,8 @@ export class ToolExecutionComponent extends Container {
 		// Always create all shell variants. contentBox is used for default renderer-based composition.
 		// selfRenderContainer is used when the tool renders its own framing.
 		// contentText is reserved for generic fallback rendering when no tool definition exists.
-		this.contentBox = new Box(1, 1, (text: string) => theme.bg("toolPendingBg", text));
-		this.contentText = new Text("", 1, 1, (text: string) => theme.bg("toolPendingBg", text));
+		this.contentBox = new Box(this.toolIndent, 1, (text: string) => theme.bg("toolPendingBg", text));
+		this.contentText = new Text("", this.toolIndent, 1, (text: string) => theme.bg("toolPendingBg", text));
 		this.selfRenderContainer = new Container();
 
 		if (this.hasRendererDefinition()) {
@@ -128,6 +131,7 @@ export class ToolExecutionComponent extends Container {
 			isPartial: this.isPartial,
 			expanded: this.expanded,
 			showImages: this.showImages,
+			toolIndent: this.toolIndent,
 			isError: this.result?.isError ?? false,
 		};
 	}

packages/coding-agent/src/modes/interactive/components/user-message.ts

@@ -11,9 +11,9 @@ const OSC133_ZONE_FINAL = "\x1b]133;C\x07";
 export class UserMessageComponent extends Container {
 	private contentBox: Box;
 
-	constructor(text: string, markdownTheme: MarkdownTheme = getMarkdownTheme()) {
+	constructor(text: string, markdownTheme: MarkdownTheme = getMarkdownTheme(), toolIndent = 1) {
 		super();
-		this.contentBox = new Box(1, 1, (content: string) => theme.bg("userMessageBg", content));
+		this.contentBox = new Box(toolIndent, 1, (content: string) => theme.bg("userMessageBg", content));
 		this.contentBox.addChild(
 			new Markdown(
 				text,

packages/coding-agent/src/modes/interactive/interactive-mode.ts

@@ -20,9 +20,11 @@ import {
 import type {
 	AutocompleteItem,
 	AutocompleteProvider,
+	DefaultTextStyle,
 	EditorComponent,
 	Keybinding,
 	KeyId,
+	MarkdownOptions,
 	MarkdownTheme,
 	OverlayHandle,
 	OverlayOptions,
@@ -598,13 +600,11 @@ export class InteractiveMode {
 			const versionMatch = this.changelogMarkdown.match(/##\s+\[?(\d+\.\d+\.\d+)\]?/);
 			const latestVersion = versionMatch ? versionMatch[1] : this.version;
 			const condensedText = `Updated to v${latestVersion}. Use ${theme.bold("/changelog")} to view full changelog.`;
-			this.chatContainer.addChild(new Text(condensedText, 1, 0));
+			this.chatContainer.addChild(this.createToolText(condensedText));
 		} else {
-			this.chatContainer.addChild(new Text(theme.bold(theme.fg("accent", "What's New")), 1, 0));
+			this.chatContainer.addChild(this.createToolText(theme.bold(theme.fg("accent", "What's New"))));
 			this.chatContainer.addChild(new Spacer(1));
-			this.chatContainer.addChild(
-				new Markdown(this.changelogMarkdown.trim(), 1, 0, this.getMarkdownThemeWithSettings()),
-			);
+			this.chatContainer.addChild(this.createToolMarkdown(this.changelogMarkdown.trim()));
 			this.chatContainer.addChild(new Spacer(1));
 		}
 		this.chatContainer.addChild(new DynamicBorder());
@@ -960,6 +960,38 @@ export class InteractiveMode {
 		};
 	}
 
+	private getTranscriptIndent(): number {
+		return this.settingsManager.getTranscriptIndent();
+	}
+
+	private getToolIndent(): number {
+		return this.settingsManager.getToolIndent();
+	}
+
+	private createToolText(text: string, paddingY = 0, customBgFn?: (text: string) => string): Text {
+		return new Text(text, this.getToolIndent(), paddingY, customBgFn);
+	}
+
+	private createToolMarkdown(
+		text: string,
+		paddingY = 0,
+		defaultTextStyle?: DefaultTextStyle,
+		options?: MarkdownOptions,
+	): Markdown {
+		return new Markdown(
+			text,
+			this.getToolIndent(),
+			paddingY,
+			this.getMarkdownThemeWithSettings(),
+			defaultTextStyle,
+			options,
+		);
+	}
+
+	private createToolTruncatedText(text: string, paddingY = 0): TruncatedText {
+		return new TruncatedText(text, this.getToolIndent(), paddingY);
+	}
+
 	// =========================================================================
 	// Extension System
 	// =========================================================================
@@ -2426,7 +2458,7 @@ export class InteractiveMode {
 	 */
 	private showExtensionError(extensionPath: string, error: string, stack?: string): void {
 		const errorMsg = `Extension "${extensionPath}" error: ${error}`;
-		const errorText = new Text(theme.fg("error", errorMsg), 1, 0);
+		const errorText = this.createToolText(theme.fg("error", errorMsg));
 		this.chatContainer.addChild(errorText);
 		if (stack) {
 			// Show stack trace in dim color, indented
@@ -2436,7 +2468,7 @@ export class InteractiveMode {
 				.map((line) => theme.fg("dim", `  ${line.trim()}`))
 				.join("\n");
 			if (stackLines) {
-				this.chatContainer.addChild(new Text(stackLines, 1, 0));
+				this.chatContainer.addChild(this.createToolText(stackLines));
 			}
 		}
 		this.ui.requestRender();
@@ -2793,6 +2825,7 @@ export class InteractiveMode {
 						this.hideThinkingBlock,
 						this.getMarkdownThemeWithSettings(),
 						this.hiddenThinkingLabel,
+						this.getTranscriptIndent(),
 					);
 					this.streamingMessage = event.message;
 					this.chatContainer.addChild(this.streamingComponent);
@@ -2816,6 +2849,7 @@ export class InteractiveMode {
 									{
 										showImages: this.settingsManager.getShowImages(),
 										imageWidthCells: this.settingsManager.getImageWidthCells(),
+										toolIndent: this.getToolIndent(),
 									},
 									this.getRegisteredToolDefinition(content.name),
 									this.ui,
@@ -2885,6 +2919,7 @@ export class InteractiveMode {
 						{
 							showImages: this.settingsManager.getShowImages(),
 							imageWidthCells: this.settingsManager.getImageWidthCells(),
+							toolIndent: this.getToolIndent(),
 						},
 						this.getRegisteredToolDefinition(event.toolName),
 						this.ui,
@@ -3000,7 +3035,7 @@ export class InteractiveMode {
 						this.showError(event.errorMessage);
 					} else {
 						this.chatContainer.addChild(new Spacer(1));
-						this.chatContainer.addChild(new Text(theme.fg("error", event.errorMessage), 1, 0));
+						this.chatContainer.addChild(this.createToolText(theme.fg("error", event.errorMessage)));
 					}
 				}
 				void this.flushCompactionQueue({ willRetry: event.willRetry });
@@ -3094,7 +3129,7 @@ export class InteractiveMode {
 		}
 
 		const spacer = new Spacer(1);
-		const text = new Text(theme.fg("dim", message), 1, 0);
+		const text = this.createToolText(theme.fg("dim", message));
 		this.chatContainer.addChild(spacer);
 		this.chatContainer.addChild(text);
 		this.lastStatusSpacer = spacer;
@@ -3105,7 +3140,12 @@ export class InteractiveMode {
 	private addMessageToChat(message: AgentMessage, options?: { populateHistory?: boolean }): void {
 		switch (message.role) {
 			case "bashExecution": {
-				const component = new BashExecutionComponent(message.command, this.ui, message.excludeFromContext);
+				const component = new BashExecutionComponent(
+					message.command,
+					this.ui,
+					message.excludeFromContext,
+					this.getToolIndent(),
+				);
 				if (message.output) {
 					component.appendOutput(message.output);
 				}
@@ -3121,7 +3161,12 @@ export class InteractiveMode {
 			case "custom": {
 				if (message.display) {
 					const renderer = this.session.extensionRunner.getMessageRenderer(message.customType);
-					const component = new CustomMessageComponent(message, renderer, this.getMarkdownThemeWithSettings());
+					const component = new CustomMessageComponent(
+						message,
+						renderer,
+						this.getMarkdownThemeWithSettings(),
+						this.getToolIndent(),
+					);
 					component.setExpanded(this.toolOutputExpanded);
 					this.chatContainer.addChild(component);
 				}
@@ -3129,14 +3174,22 @@ export class InteractiveMode {
 			}
 			case "compactionSummary": {
 				this.chatContainer.addChild(new Spacer(1));
-				const component = new CompactionSummaryMessageComponent(message, this.getMarkdownThemeWithSettings());
+				const component = new CompactionSummaryMessageComponent(
+					message,
+					this.getMarkdownThemeWithSettings(),
+					this.getToolIndent(),
+				);
 				component.setExpanded(this.toolOutputExpanded);
 				this.chatContainer.addChild(component);
 				break;
 			}
 			case "branchSummary": {
 				this.chatContainer.addChild(new Spacer(1));
-				const component = new BranchSummaryMessageComponent(message, this.getMarkdownThemeWithSettings());
+				const component = new BranchSummaryMessageComponent(
+					message,
+					this.getMarkdownThemeWithSettings(),
+					this.getToolIndent(),
+				);
 				component.setExpanded(this.toolOutputExpanded);
 				this.chatContainer.addChild(component);
 				break;
@@ -3153,6 +3206,7 @@ export class InteractiveMode {
 						const component = new SkillInvocationMessageComponent(
 							skillBlock,
 							this.getMarkdownThemeWithSettings(),
+							this.getToolIndent(),
 						);
 						component.setExpanded(this.toolOutputExpanded);
 						this.chatContainer.addChild(component);
@@ -3162,11 +3216,16 @@ export class InteractiveMode {
 							const userComponent = new UserMessageComponent(
 								skillBlock.userMessage,
 								this.getMarkdownThemeWithSettings(),
+								this.getToolIndent(),
 							);
 							this.chatContainer.addChild(userComponent);
 						}
 					} else {
-						const userComponent = new UserMessageComponent(textContent, this.getMarkdownThemeWithSettings());
+						const userComponent = new UserMessageComponent(
+							textContent,
+							this.getMarkdownThemeWithSettings(),
+							this.getToolIndent(),
+						);
 						this.chatContainer.addChild(userComponent);
 					}
 					if (options?.populateHistory) {
@@ -3181,6 +3240,7 @@ export class InteractiveMode {
 					this.hideThinkingBlock,
 					this.getMarkdownThemeWithSettings(),
 					this.hiddenThinkingLabel,
+					this.getTranscriptIndent(),
 				);
 				this.chatContainer.addChild(assistantComponent);
 				break;
@@ -3227,6 +3287,7 @@ export class InteractiveMode {
 							{
 								showImages: this.settingsManager.getShowImages(),
 								imageWidthCells: this.settingsManager.getImageWidthCells(),
+								toolIndent: this.getToolIndent(),
 							},
 							this.getRegisteredToolDefinition(content.name),
 							this.ui,
@@ -3298,13 +3359,11 @@ export class InteractiveMode {
 			this.chatContainer.addChild(new Spacer(1));
 		}
 		this.chatContainer.addChild(
-			new Text(
+			this.createToolText(
 				theme.fg(
 					"warning",
 					`This project is not trusted. Project ${CONFIG_DIR_NAME} resources and packages are ignored. Use /trust to save a trust decision, then restart pi.`,
 				),
-				1,
-				0,
 			),
 		);
 	}
@@ -3713,13 +3772,13 @@ export class InteractiveMode {
 
 	showError(errorMessage: string): void {
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new Text(theme.fg("error", `Error: ${errorMessage}`), 1, 0));
+		this.chatContainer.addChild(this.createToolText(theme.fg("error", `Error: ${errorMessage}`)));
 		this.ui.requestRender();
 	}
 
 	showWarning(warningMessage: string): void {
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new Text(theme.fg("warning", `Warning: ${warningMessage}`), 1, 0));
+		this.chatContainer.addChild(this.createToolText(theme.fg("warning", `Warning: ${warningMessage}`)));
 		this.ui.requestRender();
 	}
 
@@ -3736,18 +3795,18 @@ export class InteractiveMode {
 		this.chatContainer.addChild(new Spacer(1));
 		this.chatContainer.addChild(new DynamicBorder((text) => theme.fg("warning", text)));
 		this.chatContainer.addChild(
-			new Text(`${theme.bold(theme.fg("warning", "Update Available"))}\n${updateInstruction}`, 1, 0),
+			this.createToolText(`${theme.bold(theme.fg("warning", "Update Available"))}\n${updateInstruction}`),
 		);
 		if (note) {
 			this.chatContainer.addChild(new Spacer(1));
 			this.chatContainer.addChild(
-				new Markdown(note, 1, 0, this.getMarkdownThemeWithSettings(), {
+				this.createToolMarkdown(note, 0, {
 					color: (text) => theme.fg("muted", text),
 				}),
 			);
 			this.chatContainer.addChild(new Spacer(1));
 		}
-		this.chatContainer.addChild(new Text(changelogLine, 1, 0));
+		this.chatContainer.addChild(this.createToolText(changelogLine));
 		this.chatContainer.addChild(new DynamicBorder((text) => theme.fg("warning", text)));
 		this.ui.requestRender();
 	}
@@ -3760,10 +3819,8 @@ export class InteractiveMode {
 		this.chatContainer.addChild(new Spacer(1));
 		this.chatContainer.addChild(new DynamicBorder((text) => theme.fg("warning", text)));
 		this.chatContainer.addChild(
-			new Text(
+			this.createToolText(
 				`${theme.bold(theme.fg("warning", "Package Updates Available"))}\n${updateInstruction}\n${theme.fg("muted", "Packages:")}\n${packageLines}`,
-				1,
-				0,
 			),
 		);
 		this.chatContainer.addChild(new DynamicBorder((text) => theme.fg("warning", text)));
@@ -3813,15 +3870,15 @@ export class InteractiveMode {
 			this.pendingMessagesContainer.addChild(new Spacer(1));
 			for (const message of steeringMessages) {
 				const text = theme.fg("dim", `Steering: ${message}`);
-				this.pendingMessagesContainer.addChild(new TruncatedText(text, 1, 0));
+				this.pendingMessagesContainer.addChild(this.createToolTruncatedText(text));
 			}
 			for (const message of followUpMessages) {
 				const text = theme.fg("dim", `Follow-up: ${message}`);
-				this.pendingMessagesContainer.addChild(new TruncatedText(text, 1, 0));
+				this.pendingMessagesContainer.addChild(this.createToolTruncatedText(text));
 			}
 			const dequeueHint = this.getAppKeyDisplay("app.message.dequeue");
 			const hintText = theme.fg("dim", `↳ ${dequeueHint} to edit all queued messages`);
-			this.pendingMessagesContainer.addChild(new TruncatedText(hintText, 1, 0));
+			this.pendingMessagesContainer.addChild(this.createToolTruncatedText(hintText));
 		}
 	}
 
@@ -3998,6 +4055,8 @@ export class InteractiveMode {
 					showHardwareCursor: this.settingsManager.getShowHardwareCursor(),
 					defaultProjectTrust: this.settingsManager.getDefaultProjectTrust(),
 					editorPaddingX: this.settingsManager.getEditorPaddingX(),
+					transcriptIndent: this.settingsManager.getTranscriptIndent(),
+					toolIndent: this.settingsManager.getToolIndent(),
 					autocompleteMaxVisible: this.settingsManager.getAutocompleteMaxVisible(),
 					quietStartup: this.settingsManager.getQuietStartup(),
 					clearOnShrink: this.settingsManager.getClearOnShrink(),
@@ -4063,12 +4122,6 @@ export class InteractiveMode {
 					onHideThinkingBlockChange: (hidden) => {
 						this.hideThinkingBlock = hidden;
 						this.settingsManager.setHideThinkingBlock(hidden);
-						for (const child of this.chatContainer.children) {
-							if (child instanceof AssistantMessageComponent) {
-								child.setHideThinkingBlock(hidden);
-							}
-						}
-						this.chatContainer.clear();
 						this.rebuildChatFromMessages();
 					},
 					onCollapseChangelogChange: (collapsed) => {
@@ -4100,6 +4153,14 @@ export class InteractiveMode {
 							this.editor.setPaddingX(padding);
 						}
 					},
+					onTranscriptIndentChange: (indent) => {
+						this.settingsManager.setTranscriptIndent(indent);
+						this.rebuildChatFromMessages();
+					},
+					onToolIndentChange: (indent) => {
+						this.settingsManager.setToolIndent(indent);
+						this.rebuildChatFromMessages();
+					},
 					onAutocompleteMaxVisibleChange: (maxVisible) => {
 						this.settingsManager.setAutocompleteMaxVisible(maxVisible);
 						this.defaultEditor.setAutocompleteMaxVisible(maxVisible);
@@ -5349,7 +5410,7 @@ export class InteractiveMode {
 			const currentName = this.sessionManager.getSessionName();
 			if (currentName) {
 				this.chatContainer.addChild(new Spacer(1));
-				this.chatContainer.addChild(new Text(theme.fg("dim", `Session name: ${currentName}`), 1, 0));
+				this.chatContainer.addChild(this.createToolText(theme.fg("dim", `Session name: ${currentName}`)));
 			} else {
 				this.showWarning("Usage: /name <name>");
 			}
@@ -5363,7 +5424,7 @@ export class InteractiveMode {
 			this.showWarning(`Session name was normalized from ${JSON.stringify(name)} to ${JSON.stringify(sessionName)}`);
 		}
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new Text(theme.fg("dim", `Session name set: ${sessionName ?? name}`), 1, 0));
+		this.chatContainer.addChild(this.createToolText(theme.fg("dim", `Session name set: ${sessionName ?? name}`)));
 		this.ui.requestRender();
 	}
 
@@ -5400,7 +5461,7 @@ export class InteractiveMode {
 		}
 
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new Text(info, 1, 0));
+		this.chatContainer.addChild(this.createToolText(info));
 		this.ui.requestRender();
 	}
 
@@ -5418,9 +5479,9 @@ export class InteractiveMode {
 
 		this.chatContainer.addChild(new Spacer(1));
 		this.chatContainer.addChild(new DynamicBorder());
-		this.chatContainer.addChild(new Text(theme.bold(theme.fg("accent", "What's New")), 1, 0));
+		this.chatContainer.addChild(this.createToolText(theme.bold(theme.fg("accent", "What's New"))));
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new Markdown(changelogMarkdown, 1, 1, this.getMarkdownThemeWithSettings()));
+		this.chatContainer.addChild(this.createToolMarkdown(changelogMarkdown, 1));
 		this.chatContainer.addChild(new DynamicBorder());
 		this.ui.requestRender();
 	}
@@ -5547,9 +5608,9 @@ export class InteractiveMode {
 
 		this.chatContainer.addChild(new Spacer(1));
 		this.chatContainer.addChild(new DynamicBorder());
-		this.chatContainer.addChild(new Text(theme.bold(theme.fg("accent", "Keyboard Shortcuts")), 1, 0));
+		this.chatContainer.addChild(this.createToolText(theme.bold(theme.fg("accent", "Keyboard Shortcuts"))));
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new Markdown(hotkeys.trim(), 1, 1, this.getMarkdownThemeWithSettings()));
+		this.chatContainer.addChild(this.createToolMarkdown(hotkeys.trim(), 1));
 		this.chatContainer.addChild(new DynamicBorder());
 		this.ui.requestRender();
 	}
@@ -5566,7 +5627,7 @@ export class InteractiveMode {
 				return;
 			}
 			this.chatContainer.addChild(new Spacer(1));
-			this.chatContainer.addChild(new Text(`${theme.fg("accent", "✓ New session started")}`, 1, 1));
+			this.chatContainer.addChild(this.createToolText(`${theme.fg("accent", "✓ New session started")}`, 1));
 			this.ui.requestRender();
 		} catch (error: unknown) {
 			await this.handleFatalRuntimeError("Failed to create session", error);
@@ -5601,20 +5662,20 @@ export class InteractiveMode {
 
 		this.chatContainer.addChild(new Spacer(1));
 		this.chatContainer.addChild(
-			new Text(`${theme.fg("accent", "✓ Debug log written")}\n${theme.fg("muted", debugLogPath)}`, 1, 1),
+			this.createToolText(`${theme.fg("accent", "✓ Debug log written")}\n${theme.fg("muted", debugLogPath)}`, 1),
 		);
 		this.ui.requestRender();
 	}
 
 	private handleArminSaysHi(): void {
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new ArminComponent(this.ui));
+		this.chatContainer.addChild(new ArminComponent(this.ui, this.getToolIndent()));
 		this.ui.requestRender();
 	}
 
 	private handleDementedDelves(): void {
 		this.chatContainer.addChild(new Spacer(1));
-		this.chatContainer.addChild(new EarendilAnnouncementComponent());
+		this.chatContainer.addChild(new EarendilAnnouncementComponent(this.getToolIndent()));
 		this.ui.requestRender();
 	}
 
@@ -5646,7 +5707,7 @@ export class InteractiveMode {
 			const result = eventResult.result;
 
 			// Create UI component for display
-			this.bashComponent = new BashExecutionComponent(command, this.ui, excludeFromContext);
+			this.bashComponent = new BashExecutionComponent(command, this.ui, excludeFromContext, this.getToolIndent());
 			if (this.session.isStreaming) {
 				this.pendingMessagesContainer.addChild(this.bashComponent);
 				this.pendingBashComponents.push(this.bashComponent);
@@ -5674,7 +5735,7 @@ export class InteractiveMode {
 
 		// Normal execution path (possibly with custom operations)
 		const isDeferred = this.session.isStreaming;
-		this.bashComponent = new BashExecutionComponent(command, this.ui, excludeFromContext);
+		this.bashComponent = new BashExecutionComponent(command, this.ui, excludeFromContext, this.getToolIndent());
 
 		if (isDeferred) {
 			// Show in pending area when agent is streaming

packages/coding-agent/test/settings-manager.test.ts

@@ -354,6 +354,31 @@ describe("SettingsManager", () => {
 		});
 	});
 
+	it("should normalize and save transcript/tool indents", async () => {
+		const settingsPath = join(agentDir, "settings.json");
+		let manager = SettingsManager.create(projectDir, agentDir);
+		expect(manager.getTranscriptIndent()).toBe(1);
+		expect(manager.getToolIndent()).toBe(1);
+
+		writeFileSync(settingsPath, JSON.stringify({ transcriptIndent: 0, toolIndent: 4 }));
+		manager = SettingsManager.create(projectDir, agentDir);
+		expect(manager.getTranscriptIndent()).toBe(0);
+		expect(manager.getToolIndent()).toBe(4);
+
+		writeFileSync(settingsPath, JSON.stringify({ transcriptIndent: 5, toolIndent: "2" }));
+		manager = SettingsManager.create(projectDir, agentDir);
+		expect(manager.getTranscriptIndent()).toBe(1);
+		expect(manager.getToolIndent()).toBe(1);
+
+		manager.setTranscriptIndent(2);
+		manager.setToolIndent(3);
+		await manager.flush();
+
+		const savedSettings = JSON.parse(readFileSync(settingsPath, "utf-8"));
+		expect(savedSettings.transcriptIndent).toBe(2);
+		expect(savedSettings.toolIndent).toBe(3);
+	});
+
 	describe("shellCommandPrefix", () => {
 		it("should load shellCommandPrefix from settings", () => {
 			const settingsPath = join(agentDir, "settings.json");

packages/coding-agent/test/tool-execution-component.test.ts

@@ -67,6 +67,26 @@ describe("ToolExecutionComponent parity", () => {
 		expect(rendered).toContain("custom result");
 	});
 
+	test("applies tool indentation to default tool shells and render contexts", () => {
+		const toolDefinition: ToolDefinition = {
+			...createBaseToolDefinition(),
+			renderCall: (_args, _theme, context) => new Text(`indent:${context.toolIndent}`, 0, 0),
+		};
+
+		const component = new ToolExecutionComponent(
+			"custom_tool",
+			"tool-indent",
+			{},
+			{ toolIndent: 4 },
+			toolDefinition,
+			createFakeTui(),
+			process.cwd(),
+		);
+
+		const contentLine = stripAnsi(component.render(40).find((line) => line.includes("indent:")) ?? "").trimEnd();
+		expect(contentLine).toBe("    indent:4");
+	});
+
 	test("self-rendered empty tool rows take no layout space", () => {
 		const toolDefinition: ToolDefinition = {
 			...createBaseToolDefinition(),