diff --git a/packages/coding-agent/src/core/compaction/branch-summarization.ts b/packages/coding-agent/src/core/compaction/branch-summarization.ts
index 69bd75133..6f8bc0cb3 100644
--- a/packages/coding-agent/src/core/compaction/branch-summarization.ts
+++ b/packages/coding-agent/src/core/compaction/branch-summarization.ts
@@ -15,7 +15,12 @@ import {
 	createCompactionSummaryMessage,
 	createCustomMessage,
 } from "../messages.ts";
-import type { ReadonlySessionManager, SessionEntry } from "../session-manager.ts";
+import {
+	type ContextEditEntry,
+	projectContextEntry,
+	type ReadonlySessionManager,
+	type SessionEntry,
+} from "../session-manager.ts";
 import { completeSummarization, estimateTokens, getSummarizationFailure } from "./compaction.ts";
 import {
 	computeFileLists,
@@ -155,14 +160,15 @@ export function collectEntriesForBranchSummary(
  * Extract AgentMessage from a session entry.
  * Similar to getMessageFromEntry in compaction.ts but also handles compaction entries.
  */
-function getMessageFromEntry(entry: SessionEntry): AgentMessage | undefined {
+function getMessageFromEntry(entry: SessionEntry, edit?: ContextEditEntry): AgentMessage | undefined {
 	switch (entry.type) {
 		case "message":
 			// Skip tool results - context is in assistant's tool call
 			if (entry.message.role === "toolResult") return undefined;
-			return entry.message;
+			return edit ? projectContextEntry(entry, edit)[0] : entry.message;
 
 		case "custom_message":
+			if (edit) return projectContextEntry(entry, edit)[0];
 			return createCustomMessage(entry.customType, entry.content, entry.display, entry.details, entry.timestamp);
 
 		case "branch_summary":
@@ -217,10 +223,16 @@ export function prepareBranchEntries(entries: SessionEntry[], tokenBudget: numbe
 		}
 	}
 
+	// Context edits hide or replace earlier entries in model context; honor the latest edit per target.
+	const edits = new Map<string, ContextEditEntry>();
+	for (const entry of entries) {
+		if (entry.type === "context_edit") edits.set(entry.targetId, entry);
+	}
+
 	// Second pass: walk from newest to oldest, adding messages until token budget
 	for (let i = entries.length - 1; i >= 0; i--) {
 		const entry = entries[i];
-		const message = getMessageFromEntry(entry);
+		const message = getMessageFromEntry(entry, edits.get(entry.id));
 		if (!message) continue;
 
 		// Extract file ops from assistant messages (tool calls)
diff --git a/packages/coding-agent/src/core/session-manager.ts b/packages/coding-agent/src/core/session-manager.ts
index 822aad816..20b6edaa9 100644
--- a/packages/coding-agent/src/core/session-manager.ts
+++ b/packages/coding-agent/src/core/session-manager.ts
@@ -516,7 +516,8 @@ export function buildContextEntries(
  * If leafId is provided, walks from that entry to root.
  * Handles compaction and branch summaries along the path.
  */
-function projectContextEntry(entry: SessionEntry, edit: ContextEditEntry | undefined): AgentMessage[] {
+/** Project one entry into model-visible messages, applying its latest context edit if any. */
+export function projectContextEntry(entry: SessionEntry, edit: ContextEditEntry | undefined): AgentMessage[] {
 	const messages = sessionEntryToContextMessages(entry);
 	if (!edit) return messages;
 	const replacement = edit.replacement;
diff --git a/packages/coding-agent/test/branch-summarization.test.ts b/packages/coding-agent/test/branch-summarization.test.ts
index ade25dbfd..3164a8773 100644
--- a/packages/coding-agent/test/branch-summarization.test.ts
+++ b/packages/coding-agent/test/branch-summarization.test.ts
@@ -7,7 +7,7 @@ import {
 	type SimpleStreamOptions,
 } from "@earendil-works/pi-ai";
 import { describe, expect, it } from "vitest";
-import { generateBranchSummary } from "../src/core/compaction/index.ts";
+import { generateBranchSummary, prepareBranchEntries } from "../src/core/compaction/index.ts";
 import type { SessionEntry } from "../src/core/session-manager.ts";
 
 const model: Model<"anthropic-messages"> = {
@@ -131,4 +131,54 @@ describe("branch summarization", () => {
 			"Branch summarization failed: generation hit the token cap and the summary is incomplete",
 		);
 	});
+
+	it("applies context edits to branch entries", () => {
+		const ts = (n: number) => new Date(n).toISOString();
+		const branch: SessionEntry[] = [
+			{
+				type: "message",
+				id: "u1",
+				parentId: null,
+				timestamp: ts(1),
+				message: { role: "user", content: "Investigate login", timestamp: 1 },
+			},
+			{
+				type: "message",
+				id: "failed",
+				parentId: "u1",
+				timestamp: ts(2),
+				message: fauxAssistantMessage("FAILED_ATTEMPT", { stopReason: "error", errorMessage: "lost" }),
+			},
+			{
+				type: "context_edit",
+				id: "e1",
+				parentId: "failed",
+				timestamp: ts(3),
+				targetId: "failed",
+				replacement: null,
+			},
+			{
+				type: "message",
+				id: "ok",
+				parentId: "e1",
+				timestamp: ts(4),
+				message: fauxAssistantMessage("ORIGINAL_TEXT"),
+			},
+			{
+				type: "context_edit",
+				id: "e2",
+				parentId: "ok",
+				timestamp: ts(5),
+				targetId: "ok",
+				replacement: { content: "REPLACED_TEXT" },
+			},
+		];
+
+		const serialized = JSON.stringify(prepareBranchEntries(branch).messages);
+
+		expect(serialized).toContain("Investigate login");
+		expect(serialized).not.toContain("FAILED_ATTEMPT");
+		expect(serialized).not.toContain("ORIGINAL_TEXT");
+		expect(serialized).toContain("REPLACED_TEXT");
+	});
 });