diff --git a/internal/app/app.go b/internal/app/app.go
index 218ba8af..80a8bf22 100644
--- a/internal/app/app.go
+++ b/internal/app/app.go
@@ -356,6 +356,15 @@ func (a *App) CompactConversation(customInstructions string) error {
 			a.mu.Unlock()
 		}()
 
+		// Subscribe to SDK events for streaming compaction summary to the TUI.
+		sendFn := func(msg tea.Msg) {
+			if a.program != nil {
+				a.program.Send(msg)
+			}
+		}
+		unsub := a.subscribeSDKEvents(sendFn, nil)
+		defer unsub()
+
 		result, err := a.opts.Kit.Compact(a.rootCtx, nil, customInstructions)
 		if err != nil {
 			a.sendEvent(CompactErrorEvent{Err: err})
diff --git a/internal/compaction/compaction.go b/internal/compaction/compaction.go
index 8d73283d..71d15005 100644
--- a/internal/compaction/compaction.go
+++ b/internal/compaction/compaction.go
@@ -428,6 +428,10 @@ type PreviousCompaction struct {
 	ModifiedFiles []string
 }
 
+// StreamCallback is called for each chunk of text during streaming compaction.
+// Return a non-nil error to cancel the stream.
+type StreamCallback func(delta string) error
+
 // Compact summarises older messages using the LLM, returning the compaction
 // result and a new message slice (summary message + preserved recent
 // messages).
@@ -442,6 +446,8 @@ type PreviousCompaction struct {
 //
 // prev carries file tracking from a previous compaction for cumulative
 // tracking. Pass nil if there is no prior compaction.
+// onChunk is an optional callback for streaming summary text. Pass nil for
+// non-streaming compaction.
 func Compact(
 	ctx context.Context,
 	model fantasy.LanguageModel,
@@ -449,6 +455,7 @@ func Compact(
 	opts CompactionOptions,
 	customInstructions string,
 	prev *PreviousCompaction,
+	onChunk StreamCallback,
 ) (*CompactionResult, []fantasy.Message, error) {
 	opts.defaults()
 
@@ -487,9 +494,9 @@ func Compact(
 	var err error
 
 	if IsSplitTurn(messages, cutPoint) {
-		summaryText, err = compactSplitTurn(ctx, model, oldMessages, messages, cutPoint, opts, customInstructions)
+		summaryText, err = compactSplitTurn(ctx, model, oldMessages, messages, cutPoint, opts, customInstructions, onChunk)
 	} else {
-		summaryText, err = compactNormal(ctx, model, oldMessages, opts, customInstructions)
+		summaryText, err = compactNormal(ctx, model, oldMessages, opts, customInstructions, onChunk)
 	}
 	if err != nil {
 		return nil, nil, err
@@ -527,15 +534,17 @@ func Compact(
 }
 
 // compactNormal generates a summary for a clean turn-boundary cut.
+// If onChunk is provided, text deltas are streamed to it.
 func compactNormal(
 	ctx context.Context,
 	model fantasy.LanguageModel,
 	oldMessages []fantasy.Message,
 	opts CompactionOptions,
 	customInstructions string,
+	onChunk StreamCallback,
 ) (string, error) {
 	conversationText := serializeMessages(oldMessages)
-	return generateSummary(ctx, model, conversationText, opts, customInstructions)
+	return generateSummary(ctx, model, conversationText, opts, customInstructions, onChunk)
 }
 
 // compactSplitTurn handles the case where the cut point lands mid-turn.
@@ -546,6 +555,7 @@ func compactNormal(
 //
 // The merged result preserves context from both the older history and the
 // beginning of the current long turn.
+// If onChunk is provided, both summaries and the separator are streamed.
 func compactSplitTurn(
 	ctx context.Context,
 	model fantasy.LanguageModel,
@@ -554,6 +564,7 @@ func compactSplitTurn(
 	cutPoint int,
 	opts CompactionOptions,
 	customInstructions string,
+	onChunk StreamCallback,
 ) (string, error) {
 	// Find where the split turn starts.
 	turnStart := findTurnStart(allMessages, cutPoint)
@@ -573,12 +584,19 @@ func compactSplitTurn(
 	// Generate history summary if there are complete turns before the split.
 	if len(historyMessages) >= 2 {
 		historySummary, err = generateSummary(ctx, model,
-			serializeMessages(historyMessages), opts, "")
+			serializeMessages(historyMessages), opts, "", onChunk)
 		if err != nil {
 			return "", fmt.Errorf("split turn history summary failed: %w", err)
 		}
 	}
 
+	// Stream the separator between history and turn prefix summaries.
+	if onChunk != nil && historySummary != "" {
+		if err := onChunk("\n\n---\n\n## Current Turn (in progress)\n\n"); err != nil {
+			return "", fmt.Errorf("streaming separator failed: %w", err)
+		}
+	}
+
 	// Generate turn prefix summary.
 	turnPrefixText := serializeMessages(turnPrefixMessages)
 	turnPrefixPrompt := "The messages above are the BEGINNING of a long turn that was split. " +
@@ -588,16 +606,10 @@ func compactSplitTurn(
 		turnPrefixPrompt += "\n\nAdditional instructions: " + customInstructions
 	}
 
-	summaryAgent := fantasy.NewAgent(model,
-		fantasy.WithSystemPrompt(defaultSystemPrompt),
-	)
-	result, err := summaryAgent.Generate(ctx, fantasy.AgentCall{
-		Prompt: turnPrefixText + "\n\n" + turnPrefixPrompt,
-	})
+	turnPrefixSummary, err := generateSummary(ctx, model, turnPrefixText, opts, turnPrefixPrompt, onChunk)
 	if err != nil {
 		return "", fmt.Errorf("split turn prefix summary failed: %w", err)
 	}
-	turnPrefixSummary := result.Response.Content.Text()
 
 	// Merge the two summaries.
 	if historySummary != "" && turnPrefixSummary != "" {
@@ -610,12 +622,14 @@ func compactSplitTurn(
 }
 
 // generateSummary calls the LLM to produce a structured summary.
+// If onChunk is provided, the summary is streamed using Agent.Stream().
 func generateSummary(
 	ctx context.Context,
 	model fantasy.LanguageModel,
 	conversationText string,
 	opts CompactionOptions,
 	customInstructions string,
+	onChunk StreamCallback,
 ) (string, error) {
 	userPrompt := opts.SummaryPrompt
 	if userPrompt == "" {
@@ -628,8 +642,31 @@ func generateSummary(
 	summaryAgent := fantasy.NewAgent(model,
 		fantasy.WithSystemPrompt(defaultSystemPrompt),
 	)
+
+	prompt := conversationText + "\n\n" + userPrompt
+
+	// Use streaming if onChunk is provided.
+	if onChunk != nil {
+		var fullText strings.Builder
+		_, err := summaryAgent.Stream(ctx, fantasy.AgentStreamCall{
+			Prompt: prompt,
+			OnTextDelta: func(_, delta string) error {
+				if delta != "" {
+					fullText.WriteString(delta)
+					return onChunk(delta)
+				}
+				return nil
+			},
+		})
+		if err != nil {
+			return "", fmt.Errorf("compaction summarisation (streaming) failed: %w", err)
+		}
+		return fullText.String(), nil
+	}
+
+	// Non-streaming path.
 	result, err := summaryAgent.Generate(ctx, fantasy.AgentCall{
-		Prompt: conversationText + "\n\n" + userPrompt,
+		Prompt: prompt,
 	})
 	if err != nil {
 		return "", fmt.Errorf("compaction summarisation failed: %w", err)
diff --git a/internal/compaction/compaction_test.go b/internal/compaction/compaction_test.go
index bf238f39..2ca7c075 100644
--- a/internal/compaction/compaction_test.go
+++ b/internal/compaction/compaction_test.go
@@ -243,7 +243,7 @@ func TestCompact_TooFewMessages(t *testing.T) {
 		makeTextMessageN(fantasy.MessageRoleUser, 400),
 	}
 
-	result, newMsgs, err := Compact(context.TODO(), nil, msgs, CompactionOptions{}, "", nil)
+	result, newMsgs, err := Compact(context.TODO(), nil, msgs, CompactionOptions{}, "", nil, nil)
 	if err != nil {
 		t.Fatalf("unexpected error: %v", err)
 	}
@@ -262,7 +262,7 @@ func TestCompact_WithinBudget(t *testing.T) {
 		makeTextMessageN(fantasy.MessageRoleAssistant, 400),
 	}
 
-	result, newMsgs, err := Compact(context.TODO(), nil, msgs, CompactionOptions{}, "", nil)
+	result, newMsgs, err := Compact(context.TODO(), nil, msgs, CompactionOptions{}, "", nil, nil)
 	if err != nil {
 		t.Fatalf("unexpected error: %v", err)
 	}
diff --git a/internal/ui/input.go b/internal/ui/input.go
index 41a53d9e..205ed9c1 100644
--- a/internal/ui/input.go
+++ b/internal/ui/input.go
@@ -552,9 +552,9 @@ func (s *InputComponent) RenderPopupCentered(termWidth, termHeight int) string {
 	if !s.showPopup || len(s.filtered) == 0 {
 		return ""
 	}
-	
+
 	popupContent := s.renderPopupWithOptions(true)
-	
+
 	// Center popup using lipgloss.Place
 	positioned := lipgloss.Place(
 		termWidth,
@@ -563,7 +563,7 @@ func (s *InputComponent) RenderPopupCentered(termWidth, termHeight int) string {
 		lipgloss.Center,
 		popupContent,
 	)
-	
+
 	return positioned
 }
 
diff --git a/internal/ui/message_items.go b/internal/ui/message_items.go
index df3932f5..4e8cdc3a 100644
--- a/internal/ui/message_items.go
+++ b/internal/ui/message_items.go
@@ -109,16 +109,16 @@ func (m *TextMessageItem) renderContent(width int) string {
 // StreamingMessageItem represents actively streaming assistant or reasoning text.
 // It accumulates content chunks and re-renders on each update for live display.
 type StreamingMessageItem struct {
-	id           string
-	role         string // "assistant" or "reasoning"
-	content      string // Accumulated streaming content
-	timestamp    time.Time
-	startTime    time.Time // When streaming started (for live duration counter)
-	modelName    string
-	streaming    bool           // true while actively streaming
+	id            string
+	role          string // "assistant" or "reasoning"
+	content       string // Accumulated streaming content
+	timestamp     time.Time
+	startTime     time.Time // When streaming started (for live duration counter)
+	modelName     string
+	streaming     bool          // true while actively streaming
 	finalDuration time.Duration // Frozen duration when complete
-	cachedRender string
-	cachedWidth  int
+	cachedRender  string
+	cachedWidth   int
 }
 
 // NewStreamingMessageItem creates a new streaming message item.
@@ -157,10 +157,10 @@ func (s *StreamingMessageItem) Render(width int) string {
 		mutedStyle := lipgloss.NewStyle().Foreground(theme.Muted)
 		ty := createTypography(theme)
 		content := strings.TrimLeft(s.content, " \t\n")
-		
+
 		var parts []string
 		parts = append(parts, mutedStyle.Render(ty.Italic(content)))
-		
+
 		// Add live duration counter (updates on each render)
 		var duration time.Duration
 		if s.finalDuration > 0 {
@@ -170,7 +170,7 @@ func (s *StreamingMessageItem) Render(width int) string {
 			// Still streaming, show live duration
 			duration = time.Since(s.startTime)
 		}
-		
+
 		if duration > 0 {
 			var durationStr string
 			if duration < time.Second {
@@ -182,7 +182,7 @@ func (s *StreamingMessageItem) Render(width int) string {
 			durationStyled := lipgloss.NewStyle().Foreground(theme.Accent).Render(durationStr)
 			parts = append(parts, label+durationStyled)
 		}
-		
+
 		rendered = styleMarginBottom1.Render(strings.Join(parts, "\n"))
 	} else {
 		// Render as assistant message
diff --git a/internal/ui/model.go b/internal/ui/model.go
index e3f242b3..65c58b97 100644
--- a/internal/ui/model.go
+++ b/internal/ui/model.go
@@ -1530,7 +1530,7 @@ func (m *AppModel) Update(msg tea.Msg) (tea.Model, tea.Cmd) {
 		// This event fires for both streaming and non-streaming paths.
 		// In streaming mode, mark the StreamingMessageItem as complete.
 		// In non-streaming mode (no stream content accumulated), print the text.
-		
+
 		// Check if we have an active StreamingMessageItem
 		hasStreamingItem := false
 		if len(m.messages) > 0 {
@@ -1539,12 +1539,12 @@ func (m *AppModel) Update(msg tea.Msg) (tea.Model, tea.Cmd) {
 				hasStreamingItem = true
 			}
 		}
-		
+
 		// Reset stream component
 		if m.stream != nil {
 			m.stream.Reset()
 		}
-		
+
 		// If no streaming item exists and we have content, print it as a regular message
 		if !hasStreamingItem && strings.TrimSpace(msg.Content) != "" {
 			m.printAssistantMessage(msg.Content)
@@ -1639,11 +1639,29 @@ func (m *AppModel) Update(msg tea.Msg) (tea.Model, tea.Cmd) {
 		m.canceling = false
 
 	case app.CompactCompleteEvent:
+		// Finalize any streaming compaction content.
 		if m.stream != nil {
 			m.stream.Reset()
 		}
 		m.state = stateInput
-		m.printCompactResult(msg)
+
+		// Mark the last streaming message as complete in ScrollList.
+		if len(m.messages) > 0 {
+			if streamMsg, ok := m.messages[len(m.messages)-1].(*StreamingMessageItem); ok {
+				streamMsg.MarkComplete()
+			}
+		}
+
+		// Refresh content to show the finalized message.
+		m.refreshContent()
+
+		// Print stats as a separate system message.
+		saved := msg.OriginalTokens - msg.CompactedTokens
+		statsMsg := fmt.Sprintf(
+			"Compaction complete: %d messages summarised, ~%dk tokens freed (%dk -> %dk)",
+			msg.MessagesRemoved, saved/1000, msg.OriginalTokens/1000, msg.CompactedTokens/1000,
+		)
+		m.printSystemMessage(statsMsg)
 
 	case app.CompactErrorEvent:
 		if m.stream != nil {
@@ -2003,7 +2021,7 @@ func (m *AppModel) View() tea.View {
 func overlayContent(base, overlay string, width, height int) string {
 	baseLines := strings.Split(base, "\n")
 	overlayLines := strings.Split(overlay, "\n")
-	
+
 	// Ensure we have exactly height lines
 	for len(baseLines) < height {
 		baseLines = append(baseLines, strings.Repeat(" ", width))
@@ -2011,7 +2029,7 @@ func overlayContent(base, overlay string, width, height int) string {
 	for len(overlayLines) < height {
 		overlayLines = append(overlayLines, strings.Repeat(" ", width))
 	}
-	
+
 	// Merge lines - overlay takes precedence where non-empty
 	result := make([]string, height)
 	for i := 0; i < height; i++ {
@@ -2023,7 +2041,7 @@ func overlayContent(base, overlay string, width, height int) string {
 			result[i] = strings.Repeat(" ", width)
 		}
 	}
-	
+
 	return strings.Join(result, "\n")
 }
 
diff --git a/pkg/kit/compaction.go b/pkg/kit/compaction.go
index 6a6ed540..602549ba 100644
--- a/pkg/kit/compaction.go
+++ b/pkg/kit/compaction.go
@@ -153,7 +153,15 @@ func (m *Kit) compactInternal(ctx context.Context, opts *CompactionOptions, cust
 	}
 
 	model := m.agent.GetModel()
-	result, _, err := compaction.Compact(ctx, model, messages, *opts, customInstructions, prev)
+
+	// Create a streaming callback to emit chunks as events.
+	streamCallback := func(delta string) error {
+		// Emit MessageUpdateEvent to the UI for streaming display.
+		m.events.emit(MessageUpdateEvent{Chunk: delta})
+		return nil
+	}
+
+	result, _, err := compaction.Compact(ctx, model, messages, *opts, customInstructions, prev, streamCallback)
 	if err != nil {
 		return nil, err
 	}
diff --git a/test_messages.txt b/test_messages.txt
new file mode 100644
index 00000000..21036f7a
--- /dev/null
+++ b/test_messages.txt
@@ -0,0 +1,9 @@
+1. Hello, world!
+
+2. Testing one, two, three.
+
+3. This is a quick test message.
+
+4. Sample text for verification.
+
+5. All systems operational.