diff --git a/integration-tests/hooks-agent-flow.test.ts b/integration-tests/hooks-agent-flow.test.ts
index 949770308b..b602737a39 100644
--- a/integration-tests/hooks-agent-flow.test.ts
+++ b/integration-tests/hooks-agent-flow.test.ts
@@ -182,14 +182,22 @@ describe('Hooks Agent Flow', () => {
       );
 
       const afterAgentScript = `
-        console.log(JSON.stringify({
-          decision: 'block',
-          reason: 'Security policy triggered',
-          hookSpecificOutput: {
-            hookEventName: 'AfterAgent',
-            clearContext: true
-          }
-        }));
+        const fs = require('fs');
+        const input = JSON.parse(fs.readFileSync(0, 'utf-8'));
+        if (input.stop_hook_active) {
+          // Retry turn: allow execution to proceed (breaks the loop)
+          console.log(JSON.stringify({ decision: 'allow' }));
+        } else {
+          // First call: block and clear context to trigger the retry
+          console.log(JSON.stringify({
+            decision: 'block',
+            reason: 'Security policy triggered',
+            hookSpecificOutput: {
+              hookEventName: 'AfterAgent',
+              clearContext: true
+            }
+          }));
+        }
       `;
       const afterAgentScriptPath = rig.createScript(
         'after_agent_clear.cjs',
@@ -198,8 +206,10 @@ describe('Hooks Agent Flow', () => {
 
       rig.setup('should process clearContext in AfterAgent hook output', {
         settings: {
-          hooks: {
+          hooksConfig: {
             enabled: true,
+          },
+          hooks: {
             BeforeModel: [
               {
                 hooks: [
diff --git a/integration-tests/hooks-system.after-agent.responses b/integration-tests/hooks-system.after-agent.responses
index 1475070c3d..526c59362d 100644
--- a/integration-tests/hooks-system.after-agent.responses
+++ b/integration-tests/hooks-system.after-agent.responses
@@ -1,2 +1,3 @@
 {"method":"generateContentStream","response":[{"candidates":[{"content":{"parts":[{"text":"Hi there!"}],"role":"model"},"finishReason":"STOP","index":0}]}]}
 {"method":"generateContentStream","response":[{"candidates":[{"content":{"parts":[{"text":"Clarification: I am a bot."}],"role":"model"},"finishReason":"STOP","index":0}]}]}
+{"method":"generateContentStream","response":[{"candidates":[{"content":{"parts":[{"text":"Security policy triggered"}],"role":"model"},"finishReason":"STOP","index":0}]}]}
diff --git a/packages/core/src/core/client.test.ts b/packages/core/src/core/client.test.ts
index 4dee75b93b..58e9645b28 100644
--- a/packages/core/src/core/client.test.ts
+++ b/packages/core/src/core/client.test.ts
@@ -3317,6 +3317,7 @@ ${JSON.stringify(
         expect(mockHookSystem.fireAfterAgentEvent).toHaveBeenCalledWith(
           partToString(request),
           'Hook Response',
+          false,
         );
 
         // Map should be empty
@@ -3358,6 +3359,7 @@ ${JSON.stringify(
         expect(mockHookSystem.fireAfterAgentEvent).toHaveBeenCalledWith(
           partToString(request),
           'Response 1\nResponse 2',
+          false,
         );
 
         expect(client['hookStateMap'].size).toBe(0);
@@ -3388,6 +3390,7 @@ ${JSON.stringify(
         expect(mockHookSystem.fireAfterAgentEvent).toHaveBeenCalledWith(
           partToString(request), // Should be 'Do something'
           expect.stringContaining('Ok'),
+          false,
         );
       });
 
@@ -3558,6 +3561,21 @@ ${JSON.stringify(
           expect.anything(),
           undefined,
         );
+
+        // First call should have stopHookActive=false, retry should have stopHookActive=true
+        expect(mockHookSystem.fireAfterAgentEvent).toHaveBeenCalledTimes(2);
+        expect(mockHookSystem.fireAfterAgentEvent).toHaveBeenNthCalledWith(
+          1,
+          expect.any(String),
+          expect.any(String),
+          false,
+        );
+        expect(mockHookSystem.fireAfterAgentEvent).toHaveBeenNthCalledWith(
+          2,
+          expect.any(String),
+          expect.any(String),
+          true,
+        );
       });
 
       it('should call resetChat when AfterAgent hook returns shouldClearContext: true', async () => {
diff --git a/packages/core/src/core/client.ts b/packages/core/src/core/client.ts
index 2ab75cf365..db6c5fb574 100644
--- a/packages/core/src/core/client.ts
+++ b/packages/core/src/core/client.ts
@@ -191,10 +191,11 @@ export class GeminiClient {
     currentRequest: PartListUnion,
     prompt_id: string,
     turn?: Turn,
+    stopHookActive: boolean = false,
   ): Promise<DefaultHookOutput | undefined> {
     const hookState = this.hookStateMap.get(prompt_id);
     // Only fire on the outermost call (when activeCalls is 1)
-    if (!hookState || hookState.activeCalls !== 1) {
+    if (!hookState || (hookState.activeCalls !== 1 && !stopHookActive)) {
       return undefined;
     }
 
@@ -210,7 +211,11 @@ export class GeminiClient {
 
     const hookOutput = await this.config
       .getHookSystem()
-      ?.fireAfterAgentEvent(partToString(finalRequest), finalResponseText);
+      ?.fireAfterAgentEvent(
+        partToString(finalRequest),
+        finalResponseText,
+        stopHookActive,
+      );
 
     return hookOutput;
   }
@@ -845,6 +850,7 @@ export class GeminiClient {
     turns: number = MAX_TURNS,
     isInvalidStreamRetry: boolean = false,
     displayContent?: PartListUnion,
+    stopHookActive: boolean = false,
   ): AsyncGenerator<ServerGeminiStreamEvent, Turn> {
     if (!isInvalidStreamRetry) {
       this.config.resetTurn();
@@ -909,6 +915,7 @@ export class GeminiClient {
           request,
           prompt_id,
           turn,
+          stopHookActive,
         );
 
         // Cast to AfterAgentHookOutput for access to shouldClearContext()
@@ -954,6 +961,7 @@ export class GeminiClient {
             boundedTurns - 1,
             false,
             displayContent,
+            true, // stopHookActive: signal retry to AfterAgent hooks
           );
         }
       }