diff --git a/docs/cli/tutorials/mcp-setup.md b/docs/cli/tutorials/mcp-setup.md
index 8723a65892..76c2806f9d 100644
--- a/docs/cli/tutorials/mcp-setup.md
+++ b/docs/cli/tutorials/mcp-setup.md
@@ -89,7 +89,7 @@ don't need to learn special commands; just ask in natural language.
 The agent will:
 
 1.  Recognize the request matches a GitHub tool.
-2.  Call `github_list_pull_requests`.
+2.  Call `mcp_github_list_pull_requests`.
 3.  Present the data to you.
 
 ### Scenario: Creating an issue
diff --git a/docs/extensions/reference.md b/docs/extensions/reference.md
index dbba51fa40..e6012f4d33 100644
--- a/docs/extensions/reference.md
+++ b/docs/extensions/reference.md
@@ -262,12 +262,14 @@ but lower priority than user or admin policies.
 
 ```toml
 [[rule]]
-toolName = "my_server__dangerous_tool"
+mcpName = "my_server"
+toolName = "dangerous_tool"
 decision = "ask_user"
 priority = 100
 
 [[safety_checker]]
-toolName = "my_server__write_data"
+mcpName = "my_server"
+toolName = "write_data"
 priority = 200
 [safety_checker.checker]
 type = "in-process"
diff --git a/docs/hooks/reference.md b/docs/hooks/reference.md
index a750bc94b3..5242c3a13d 100644
--- a/docs/hooks/reference.md
+++ b/docs/hooks/reference.md
@@ -85,7 +85,7 @@ compared against the name of the tool being executed.
   `run_shell_command`). See the [Tools Reference](../reference/tools) for a full
   list of available tool names.
 - **MCP Tools**: Tools from MCP servers follow the naming pattern
-  `mcp__<server_name>__<tool_name>`.
+  `mcp_<server_name>_<tool_name>`.
 - **Regex Support**: Matchers support regular expressions (e.g.,
   `matcher: "read_.*"` matches all file reading tools).
 
diff --git a/docs/reference/configuration.md b/docs/reference/configuration.md
index 4b50b99280..c93d0c2e66 100644
--- a/docs/reference/configuration.md
+++ b/docs/reference/configuration.md
@@ -1176,13 +1176,20 @@ their corresponding top-level category object in your `settings.json` file.
 
 Configures connections to one or more Model-Context Protocol (MCP) servers for
 discovering and using custom tools. Gemini CLI attempts to connect to each
-configured MCP server to discover available tools. If multiple MCP servers
-expose a tool with the same name, the tool names will be prefixed with the
-server alias you defined in the configuration (e.g.,
-`serverAlias__actualToolName`) to avoid conflicts. Note that the system might
-strip certain schema properties from MCP tool definitions for compatibility. At
-least one of `command`, `url`, or `httpUrl` must be provided. If multiple are
-specified, the order of precedence is `httpUrl`, then `url`, then `command`.
+configured MCP server to discover available tools. Every discovered tool is
+prepended with the `mcp_` prefix and its server alias to form a fully qualified
+name (FQN) (e.g., `mcp_serverAlias_actualToolName`) to avoid conflicts. Note
+that the system might strip certain schema properties from MCP tool definitions
+for compatibility. At least one of `command`, `url`, or `httpUrl` must be
+provided. If multiple are specified, the order of precedence is `httpUrl`, then
+`url`, then `command`.
+
+> **Warning:** Avoid using underscores (`_`) in your server aliases (e.g., use
+> `my-server` instead of `my_server`). The underlying policy engine parses Fully
+> Qualified Names (`mcp_server_tool`) using the first underscore after the
+> `mcp_` prefix. An underscore in your server alias will cause the parser to
+> misidentify the server name, which can cause security policies to fail
+> silently.
 
 - **`mcpServers.<SERVER_NAME>`** (object): The server parameters for the named
   server.
diff --git a/docs/reference/policy-engine.md b/docs/reference/policy-engine.md
index c0a331d99d..2ea23d4be4 100644
--- a/docs/reference/policy-engine.md
+++ b/docs/reference/policy-engine.md
@@ -76,9 +76,13 @@ The `toolName` in the rule must match the name of the tool being called.
 
 - **Wildcards**: You can use wildcards to match multiple tools.
   - `*`: Matches **any tool** (built-in or MCP).
-  - `server__*`: Matches any tool from a specific MCP server.
-  - `*__toolName`: Matches a specific tool name across **all** MCP servers.
-  - `*__*`: Matches **any tool from any MCP server**.
+  - `mcp_server_*`: Matches any tool from a specific MCP server.
+  - `mcp_*_toolName`: Matches a specific tool name across **all** MCP servers.
+  - `mcp_*`: Matches **any tool from any MCP server**.
+
+> **Recommendation:** While FQN wildcards are supported, the recommended
+> approach for MCP tools is to use the `mcpName` field in your TOML rules. See
+> [Special syntax for MCP tools](#special-syntax-for-mcp-tools).
 
 #### Arguments pattern
 
@@ -164,8 +168,8 @@ A rule matches a tool call if all of its conditions are met:
 
 1.  **Tool name**: The `toolName` in the rule must match the name of the tool
     being called.
-    - **Wildcards**: You can use wildcards like `*`, `server__*`, or
-      `*__toolName` to match multiple tools. See [Tool Name](#tool-name) for
+    - **Wildcards**: You can use wildcards like `*`, `mcp_server_*`, or
+      `mcp_*_toolName` to match multiple tools. See [Tool Name](#tool-name) for
       details.
 2.  **Arguments pattern**: If `argsPattern` is specified, the tool's arguments
     are converted to a stable JSON string, which is then tested against the
@@ -224,7 +228,7 @@ toolName = "run_shell_command"
 subagent = "generalist"
 
 # (Optional) The name of an MCP server. Can be combined with toolName
-# to form a composite name like "mcpName__toolName".
+# to form a composite FQN internally like "mcp_mcpName_toolName".
 mcpName = "my-custom-server"
 
 # (Optional) Metadata hints provided by the tool. A rule matches if all
@@ -301,7 +305,16 @@ priority = 100
 ### Special syntax for MCP tools
 
 You can create rules that target tools from Model Context Protocol (MCP) servers
-using the `mcpName` field or composite wildcard patterns.
+using the `mcpName` field. **This is the recommended approach** for defining MCP
+policies, as it is much more robust than manually writing Fully Qualified Names
+(FQNs) or string wildcards.
+
+> **Warning:** Do not use underscores (`_`) in your MCP server names (e.g., use
+> `my-server` rather than `my_server`). The policy parser splits Fully Qualified
+> Names (`mcp_server_tool`) on the _first_ underscore following the `mcp_`
+> prefix. If your server name contains an underscore, the parser will
+> misinterpret the server identity, which can cause wildcard rules and security
+> policies to fail silently.
 
 **1. Targeting a specific tool on a server**
 
diff --git a/docs/tools/mcp-server.md b/docs/tools/mcp-server.md
index bbb5c62aba..6b8cd22ac0 100644
--- a/docs/tools/mcp-server.md
+++ b/docs/tools/mcp-server.md
@@ -555,21 +555,34 @@ Upon successful connection:
    `excludeTools` configuration
 4. **Name sanitization:** Tool names are cleaned to meet Gemini API
    requirements:
-   - Invalid characters (non-alphanumeric, underscore, dot, hyphen) are replaced
-     with underscores
+   - Characters other than letters, numbers, underscore (`_`), hyphen (`-`), dot
+     (`.`), and colon (`:`) are replaced with underscores
    - Names longer than 63 characters are truncated with middle replacement
-     (`___`)
+     (`...`)
 
-### 3. Conflict resolution
+### 3. Tool naming and namespaces
 
-When multiple servers expose tools with the same name:
+To prevent collisions across multiple servers or conflicting built-in tools,
+every discovered MCP tool is assigned a strict namespace.
 
-1. **First registration wins:** The first server to register a tool name gets
-   the unprefixed name
-2. **Automatic prefixing:** Subsequent servers get prefixed names:
-   `serverName__toolName`
-3. **Registry tracking:** The tool registry maintains mappings between server
-   names and their tools
+1. **Automatic FQN:** All MCP tools are unconditionally assigned a fully
+   qualified name (FQN) using the format `mcp_{serverName}_{toolName}`.
+2. **Registry tracking:** The tool registry maintains metadata mappings between
+   these FQNs and their original server identities.
+3. **Overwrites:** If two servers share the exact same alias in your
+   configuration and provide tools with the exact same name, the last registered
+   tool overwrites the previous one.
+4. **Policies:** To configure permissions (like auto-approval or denial) for MCP
+   tools, see
+   [Special syntax for MCP tools](../reference/policy-engine.md#special-syntax-for-mcp-tools)
+   in the Policy Engine documentation.
+
+> **Warning:** Do not use underscores (`_`) in your MCP server names (e.g., use
+> `my-server` rather than `my_server`). The policy parser splits Fully Qualified
+> Names (`mcp_server_tool`) on the _first_ underscore following the `mcp_`
+> prefix. If your server name contains an underscore, the parser will
+> misinterpret the server identity, which can cause wildcard rules and security
+> policies to fail silently.
 
 ### 4. Schema processing
 
@@ -695,7 +708,7 @@ MCP Servers Status:
 
 🐳 dockerizedServer (CONNECTED)
   Command: docker run -i --rm -e API_KEY my-mcp-server:latest
-  Tools: docker__deploy, docker__status
+  Tools: mcp_dockerizedServer_docker_deploy, mcp_dockerizedServer_docker_status
 
 Discovery State: COMPLETED
 ```
diff --git a/packages/core/src/policy/toml-loader.ts b/packages/core/src/policy/toml-loader.ts
index 83dda26e9e..f5c176dc25 100644
--- a/packages/core/src/policy/toml-loader.ts
+++ b/packages/core/src/policy/toml-loader.ts
@@ -457,6 +457,11 @@ export async function loadPoliciesFromToml(
                 const mcpName = rule.mcpName;
 
                 if (mcpName) {
+                  // TODO(mcp): Decouple mcpName rules from FQN string parsing
+                  // to support underscores in server aliases natively. Leaving
+                  // mcpName and toolName separate here and relying on metadata
+                  // during policy evaluation will avoid underscore splitting bugs.
+                  // See: https://github.com/google-gemini/gemini-cli/issues/21727
                   effectiveToolName = formatMcpToolName(
                     mcpName,
                     effectiveToolName,