diff --git a/packages/ui/src/components/chat/message/parts/ToolPart.test.ts b/packages/ui/src/components/chat/message/parts/ToolPart.test.ts
index d31d076e..2042f014 100644
--- a/packages/ui/src/components/chat/message/parts/ToolPart.test.ts
+++ b/packages/ui/src/components/chat/message/parts/ToolPart.test.ts
@@ -1,5 +1,6 @@
 import { describe, expect, test } from 'bun:test';
 
+import { renderTerminalOutput } from './toolOutput';
 import { readTaskTagSessionIdFromOutput } from './taskSessionIdParser';
 import { tryParseJsonOutput } from '../toolRenderers';
 import { getStreamingThrottleText } from '../../hooks/useStreamingTextThrottle';
@@ -7,18 +8,73 @@ import { getStreamingOutputAppend, getToolOutput } from './toolOutput';
 import { getToolDescriptionFallback } from './toolRenderUtils';
 
 describe('getToolOutput', () => {
-    test('prefers authoritative state output', () => {
-        expect(getToolOutput('bash', 'final output', 'streamed output')).toBe('final output');
-        expect(getToolOutput('bash', '', 'streamed output')).toBe('');
+    test('prefers state.output for completed tools', () => {
+        expect(getToolOutput('bash', 'final output', 'partial output', 'completed')).toBe('final output');
     });
 
-    test('falls back to streamed metadata output for bash', () => {
-        expect(getToolOutput('bash', undefined, 'streamed output')).toBe('streamed output');
-        expect(getToolOutput('bash', undefined, '')).toBe(undefined);
+    test('normalizes completed bash state output while preserving final-output precedence', () => {
+        expect(getToolOutput('bash', '\u001B[32mFinal output\u001B[0m', 'partial output', 'completed')).toBe('Final output');
     });
 
-    test('does not expose metadata output for other tools', () => {
-        expect(getToolOutput('read', undefined, 'metadata output')).toBe(undefined);
+    test('falls back to metadata.output for bash tools without state output', () => {
+        expect(getToolOutput('bash', undefined, 'partial output', 'completed')).toBe('partial output');
+    });
+
+    test('normalizes bash metadata output for completed state', () => {
+        expect(getToolOutput('bash', undefined, 'Progress 10%\r\u001B[2KProgress 90%', 'completed')).toBe('Progress 90%');
+    });
+
+    test('does not normalize bash output while running', () => {
+        expect(getToolOutput('bash', '\u001B[32mRunning\u001B[0m', undefined, 'running')).toBe('\u001B[32mRunning\u001B[0m');
+        expect(getToolOutput('bash', undefined, 'Progress\r\u001B[2K', 'running')).toBe('Progress\r\u001B[2K');
+    });
+
+    test('ignores metadata.output for non-bash tools', () => {
+        expect(getToolOutput('read', undefined, 'partial output', 'completed')).toBe(undefined);
+        expect(getToolOutput('read', 'final output', 'partial output', 'completed')).toBe('final output');
+    });
+
+    test('returns undefined when bash has no output', () => {
+        expect(getToolOutput('bash', undefined, undefined, 'completed')).toBe(undefined);
+    });
+
+    test('ignores empty metadata.output for bash', () => {
+        expect(getToolOutput('bash', undefined, '', 'completed')).toBe(undefined);
+    });
+});
+
+describe('renderTerminalOutput', () => {
+    test('renders carriage-return progress updates as their latest value', () => {
+        expect(renderTerminalOutput('Downloading 10%\r\u001B[2KDownloading 90%')).toBe('Downloading 90%');
+    });
+
+    test('removes ANSI styles while preserving the output text', () => {
+        expect(renderTerminalOutput('\u001B[32mComplete\u001B[0m\n')).toBe('Complete\n');
+    });
+
+    test('applies cursor-up progress updates to the prior line', () => {
+        expect(renderTerminalOutput('First\nWorking\u001B[1A\r\u001B[2KDone\n')).toBe('Done\nWorking');
+    });
+
+    test('CSI K erases from cursor to end of line', () => {
+        expect(renderTerminalOutput('Hello World\u001B[5G\u001B[K')).toBe('Hell');
+    });
+
+    test('CSI 1 K erases from beginning of line through cursor, preserving suffix', () => {
+        expect(renderTerminalOutput('Hello World\u001B[6G\u001B[1K')).toBe('      World');
+    });
+
+    test('CSI 2 K erases entire line', () => {
+        expect(renderTerminalOutput('Hello World\u001B[2K')).toBe('');
+    });
+
+    test('handles large single-line output without quadratic slowdown', () => {
+        const largeLine = 'A'.repeat(50000) + '\u001B[0m';
+        const start = performance.now();
+        const result = renderTerminalOutput(largeLine);
+        const elapsed = performance.now() - start;
+        expect(result).toBe('A'.repeat(50000));
+        expect(elapsed).toBeLessThan(1000);
     });
 });
 
diff --git a/packages/ui/src/components/chat/message/parts/ToolPart.tsx b/packages/ui/src/components/chat/message/parts/ToolPart.tsx
index b703c356..612ab076 100644
--- a/packages/ui/src/components/chat/message/parts/ToolPart.tsx
+++ b/packages/ui/src/components/chat/message/parts/ToolPart.tsx
@@ -1596,7 +1596,7 @@ const ToolExpandedContent: React.FC<ToolExpandedContentProps> = React.memo(({
     const stateWithData = state as ToolStateWithMetadata;
     const metadata = stateWithData.metadata;
     const input = stateWithData.input;
-    const rawOutput = getToolOutput(part.tool, stateWithData.output, metadata?.output);
+    const rawOutput = getToolOutput(part.tool, stateWithData.output, metadata?.output, state.status);
     const hasStringOutput = typeof rawOutput === 'string' && rawOutput.length > 0;
     const rawOutputString = typeof rawOutput === 'string' ? rawOutput : '';
     const isStreamingBash = part.tool === 'bash' && state.status === 'running';
diff --git a/packages/ui/src/components/chat/message/parts/toolOutput.ts b/packages/ui/src/components/chat/message/parts/toolOutput.ts
index 88d1d0ab..5eb8dc91 100644
--- a/packages/ui/src/components/chat/message/parts/toolOutput.ts
+++ b/packages/ui/src/components/chat/message/parts/toolOutput.ts
@@ -1,14 +1,133 @@
+const ensureLine = (lines: string[][], row: number): void => {
+    while (lines.length <= row) {
+        lines.push([]);
+    }
+};
+
+const writeTerminalCharacter = (lines: string[][], row: number, column: number, character: string): void => {
+    ensureLine(lines, row);
+    const line = lines[row];
+    while (line.length < column) {
+        line.push(' ');
+    }
+    line[column] = character;
+};
+
+export const renderTerminalOutput = (output: string): string => {
+    if (!output.includes('\u001B') && !output.includes('\r') && !output.includes('\b')) {
+        return output;
+    }
+
+    const lines: string[][] = [[]];
+    let row = 0;
+    let column = 0;
+
+    for (let index = 0; index < output.length; index += 1) {
+        const character = output[index];
+
+        if (character === '\n') {
+            row += 1;
+            column = 0;
+            ensureLine(lines, row);
+            continue;
+        }
+        if (character === '\r') {
+            column = 0;
+            continue;
+        }
+        if (character === '\b') {
+            column = Math.max(0, column - 1);
+            continue;
+        }
+        if (character !== '\u001B') {
+            writeTerminalCharacter(lines, row, column, character);
+            column += 1;
+            continue;
+        }
+
+        const nextCharacter = output[index + 1];
+        if (nextCharacter === '[') {
+            const sequenceStart = index + 2;
+            let sequenceEnd = sequenceStart;
+            while (sequenceEnd < output.length && !/[\x40-\x7E]/.test(output[sequenceEnd])) {
+                sequenceEnd += 1;
+            }
+            if (sequenceEnd === output.length) {
+                break;
+            }
+
+            const command = output[sequenceEnd];
+            const parameters = output.slice(sequenceStart, sequenceEnd).split(';').map((value) => Number.parseInt(value, 10) || 0);
+            const count = parameters[0] || 1;
+            if (command === 'A') {
+                row = Math.max(0, row - count);
+            } else if (command === 'B') {
+                row += count;
+                ensureLine(lines, row);
+            } else if (command === 'C') {
+                column += count;
+            } else if (command === 'D') {
+                column = Math.max(0, column - count);
+            } else if (command === 'G') {
+                column = Math.max(0, count - 1);
+            } else if (command === 'H' || command === 'f') {
+                row = Math.max(0, (parameters[0] || 1) - 1);
+                column = Math.max(0, (parameters[1] || 1) - 1);
+                ensureLine(lines, row);
+            } else if (command === 'K') {
+                ensureLine(lines, row);
+                const line = lines[row];
+                const mode = parameters[0];
+                if (mode === 1) {
+                    for (let i = 0; i <= column && i < line.length; i += 1) {
+                        line[i] = ' ';
+                    }
+                } else if (mode === 2) {
+                    lines[row] = [];
+                } else {
+                    line.length = Math.min(line.length, column);
+                }
+            }
+            index = sequenceEnd;
+            continue;
+        }
+
+        if (nextCharacter === ']') {
+            const terminator = output.indexOf('\u0007', index + 2);
+            const stringTerminator = output.indexOf('\u001B\\', index + 2);
+            const end = terminator === -1
+                ? stringTerminator
+                : stringTerminator === -1
+                    ? terminator
+                    : Math.min(terminator, stringTerminator);
+            if (end === -1) {
+                break;
+            }
+            index = output[end] === '\u0007' ? end : end + 1;
+            continue;
+        }
+
+        index += 1;
+    }
+
+    return lines.map((line) => line.join('')).join('\n');
+};
+
 export const getToolOutput = (
     tool: string,
     stateOutput: unknown,
     metadataOutput: unknown,
+    status?: string,
 ): string | undefined => {
+    const isBash = tool === 'bash';
+    const shouldNormalize = isBash && status !== 'running';
+
     if (typeof stateOutput === 'string') {
-        return stateOutput;
+        return shouldNormalize ? renderTerminalOutput(stateOutput) : stateOutput;
     }
 
-    if (tool === 'bash' && typeof metadataOutput === 'string' && metadataOutput.length > 0) {
-        return metadataOutput;
+    if (isBash && typeof metadataOutput === 'string' && metadataOutput.length > 0) {
+        return shouldNormalize ? renderTerminalOutput(metadataOutput) : metadataOutput;
     }
 
     return undefined;