diff --git a/packages/ui/src/components/ui/UpdateDialog.tsx b/packages/ui/src/components/ui/UpdateDialog.tsx
index 37962588..b259fba9 100644
--- a/packages/ui/src/components/ui/UpdateDialog.tsx
+++ b/packages/ui/src/components/ui/UpdateDialog.tsx
@@ -108,7 +108,13 @@ function parseChangelogSections(body: string): ChangelogSection[] {
 }
 
 
-async function installWebUpdate(): Promise<{ success: boolean; error?: string }> {
+type InstallWebUpdateResult = {
+  success: boolean;
+  error?: string;
+  autoRestart?: boolean;
+};
+
+async function installWebUpdate(): Promise<InstallWebUpdateResult> {
   try {
     const response = await fetch('/api/openchamber/update-install', {
       method: 'POST',
@@ -120,21 +126,31 @@ async function installWebUpdate(): Promise<{ success: boolean; error?: string }>
       return { success: false, error: data.error || `Server error: ${response.status}` };
     }
 
-    return { success: true };
+    const data = await response.json().catch(() => ({}));
+    return {
+      success: true,
+      autoRestart: data.autoRestart !== false,
+    };
   } catch (error) {
     return { success: false, error: error instanceof Error ? error.message : 'Failed to install update' };
   }
 }
 
-async function waitForServerRestart(maxAttempts = 30, intervalMs = 2000): Promise<boolean> {
+async function waitForUpdateApplied(maxAttempts = 40, intervalMs = 2000): Promise<boolean> {
   for (let i = 0; i < maxAttempts; i++) {
     try {
-      const response = await fetch('/health', { method: 'GET' });
+      const response = await fetch('/api/openchamber/update-check', {
+        method: 'GET',
+        headers: { Accept: 'application/json' },
+      });
       if (response.ok) {
-        return true;
+        const data = await response.json().catch(() => null);
+        if (data && data.available === false) {
+          return true;
+        }
       }
     } catch {
-      // Server not ready yet
+      // Server may be restarting
     }
     await new Promise(resolve => setTimeout(resolve, intervalMs));
   }
@@ -217,22 +233,20 @@ export const UpdateDialog: React.FC<UpdateDialogProps> = ({
       return;
     }
 
-    // Server will restart, wait for it to come back
-    setWebUpdateState('restarting');
-
-    // Wait a bit for server to shut down
-    await new Promise(resolve => setTimeout(resolve, 2000));
+    if (result.autoRestart) {
+      setWebUpdateState('restarting');
+      await new Promise(resolve => setTimeout(resolve, 2000));
+    }
 
     setWebUpdateState('reconnecting');
 
-    const serverBack = await waitForServerRestart();
+    const applied = await waitForUpdateApplied();
 
-    if (serverBack) {
-      // Reload the page to get the new version
+    if (applied) {
       window.location.reload();
     } else {
       setWebUpdateState('error');
-      setWebError('Server did not restart. Please refresh manually or run: openchamber restart');
+      setWebError('Update did not apply. Refresh and try again, or run: openchamber update');
     }
   }, []);
 
diff --git a/packages/web/server/index.js b/packages/web/server/index.js
index bec3b697..52e45d60 100644
--- a/packages/web/server/index.js
+++ b/packages/web/server/index.js
@@ -6255,6 +6255,36 @@ async function main(options = {}) {
 
       const pm = detectPackageManager();
       const updateCmd = getUpdateCommand(pm);
+      const isContainer =
+        fs.existsSync('/.dockerenv') ||
+        Boolean(process.env.CONTAINER) ||
+        process.env.container === 'docker';
+
+      if (isContainer) {
+        res.json({
+          success: true,
+          message: 'Update starting, server will stay online',
+          version: updateInfo.version,
+          packageManager: pm,
+          autoRestart: false,
+        });
+
+        setTimeout(() => {
+          console.log(`\nInstalling update using ${pm} (container mode)...`);
+          console.log(`Running: ${updateCmd}`);
+
+          const shell = process.platform === 'win32' ? (process.env.ComSpec || 'cmd.exe') : 'sh';
+          const shellFlag = process.platform === 'win32' ? '/c' : '-c';
+          const child = spawnChild(shell, [shellFlag, updateCmd], {
+            detached: true,
+            stdio: 'ignore',
+            env: process.env,
+          });
+          child.unref();
+        }, 500);
+
+        return;
+      }
 
       // Get current server port for restart
       const currentPort = server.address()?.port || 3000;
@@ -6292,6 +6322,7 @@ async function main(options = {}) {
         message: 'Update starting, server will restart shortly',
         version: updateInfo.version,
         packageManager: pm,
+        autoRestart: true,
       });
 
       // Give time for response to be sent
diff --git a/packages/web/server/lib/package-manager.js b/packages/web/server/lib/package-manager.js
index 1c506287..f25f1098 100644
--- a/packages/web/server/lib/package-manager.js
+++ b/packages/web/server/lib/package-manager.js
@@ -21,29 +21,46 @@ const CHANGELOG_URL = 'https://raw.githubusercontent.com/btriapitsyn/openchamber
 export function detectPackageManager() {
   // Strategy 1: Check user agent (most reliable during install)
   const userAgent = process.env.npm_config_user_agent || '';
-  if (userAgent.startsWith('pnpm')) return 'pnpm';
-  if (userAgent.startsWith('yarn')) return 'yarn';
-  if (userAgent.startsWith('bun')) return 'bun';
-  if (userAgent.startsWith('npm')) return 'npm';
+  let hintedPm = null;
+  if (userAgent.startsWith('pnpm')) hintedPm = 'pnpm';
+  else if (userAgent.startsWith('yarn')) hintedPm = 'yarn';
+  else if (userAgent.startsWith('bun')) hintedPm = 'bun';
+  else if (userAgent.startsWith('npm')) hintedPm = 'npm';
 
   // Strategy 2: Check execpath
   const execPath = process.env.npm_execpath || '';
-  if (execPath.includes('pnpm')) return 'pnpm';
-  if (execPath.includes('yarn')) return 'yarn';
-  if (execPath.includes('bun')) return 'bun';
+  if (!hintedPm) {
+    if (execPath.includes('pnpm')) hintedPm = 'pnpm';
+    else if (execPath.includes('yarn')) hintedPm = 'yarn';
+    else if (execPath.includes('bun')) hintedPm = 'bun';
+    else if (execPath.includes('npm')) hintedPm = 'npm';
+  }
 
   // Strategy 3: Analyze package location for PM-specific patterns
-  try {
-    const pkgPath = path.resolve(__dirname, '..', '..');
-    if (pkgPath.includes('.pnpm')) return 'pnpm';
-    if (pkgPath.includes('/.yarn/') || pkgPath.includes('\\.yarn\\')) return 'yarn';
-    if (pkgPath.includes('/.bun/') || pkgPath.includes('\\.bun\\')) return 'bun';
-  } catch {
-    // Ignore path resolution errors
+  if (!hintedPm) {
+    try {
+      const pkgPath = path.resolve(__dirname, '..', '..');
+      if (pkgPath.includes('.pnpm')) hintedPm = 'pnpm';
+      else if (pkgPath.includes('/.yarn/') || pkgPath.includes('\\.yarn\\')) hintedPm = 'yarn';
+      else if (pkgPath.includes('/.bun/') || pkgPath.includes('\\.bun\\')) hintedPm = 'bun';
+    } catch {
+      // Ignore path resolution errors
+    }
+  }
+
+  // Validate the hinted PM actually owns the global install.
+  // This avoids false positives (for example running via bunx while installed with npm).
+  if (hintedPm && isCommandAvailable(hintedPm) && isPackageInstalledWith(hintedPm)) {
+    return hintedPm;
+  }
+
+  if (isCommandAvailable('npm') && isPackageInstalledWith('npm')) {
+    return 'npm';
   }
 
   // Strategy 4: Check which PM binaries are available and preferred
   const pmChecks = [
+    { name: 'npm', check: () => isCommandAvailable('npm') },
     { name: 'pnpm', check: () => isCommandAvailable('pnpm') },
     { name: 'yarn', check: () => isCommandAvailable('yarn') },
     { name: 'bun', check: () => isCommandAvailable('bun') },