diff --git a/packages/ui/src/features/command/CommandMenu.tsx b/packages/ui/src/features/command/CommandMenu.tsx
index bae485110f..e6f082a7a8 100644
--- a/packages/ui/src/features/command/CommandMenu.tsx
+++ b/packages/ui/src/features/command/CommandMenu.tsx
@@ -340,7 +340,7 @@ export function CommandMenu({ open, onOpenChange }: CommandMenuProps) {
         ? [
             {
               id: "open-review-panel",
-              label: "Open review panel",
+              label: "Open diff view",
               icon: (
                 <ViewVerticalIcon className="h-3 w-3 rotate-180 text-gray-11" />
               ),
diff --git a/packages/ui/src/features/command/keyboard-shortcuts.ts b/packages/ui/src/features/command/keyboard-shortcuts.ts
index ddc82d1172..55ad5d9458 100644
--- a/packages/ui/src/features/command/keyboard-shortcuts.ts
+++ b/packages/ui/src/features/command/keyboard-shortcuts.ts
@@ -194,7 +194,7 @@ export const KEYBOARD_SHORTCUTS: KeyboardShortcut[] = [
   {
     id: "toggle-review-panel",
     keys: SHORTCUTS.TOGGLE_REVIEW_PANEL,
-    description: "Toggle review panel",
+    description: "Toggle diff view",
     category: "navigation",
   },
   {
diff --git a/packages/ui/src/features/panels/components/LeafNodeRenderer.tsx b/packages/ui/src/features/panels/components/LeafNodeRenderer.tsx
index 7da0b54eb8..50c42f887c 100644
--- a/packages/ui/src/features/panels/components/LeafNodeRenderer.tsx
+++ b/packages/ui/src/features/panels/components/LeafNodeRenderer.tsx
@@ -1,6 +1,12 @@
 import { Cloud as CloudIcon } from "@phosphor-icons/react";
+import {
+  Empty,
+  EmptyDescription,
+  EmptyHeader,
+  EmptyMedia,
+  EmptyTitle,
+} from "@posthog/quill";
 import type { Task } from "@posthog/shared/domain-types";
-import { Flex, Text } from "@radix-ui/themes";
 import type React from "react";
 import { useMemo } from "react";
 import { useHostCapabilities } from "../../../shell/useHostCapabilities";
@@ -56,23 +62,29 @@ export const LeafNodeRenderer: React.FC<LeafNodeRendererProps> = ({
   const activeTabId = tabs.some((t) => t.id === node.content.activeTabId)
     ? node.content.activeTabId
     : (tabs[0]?.id ?? node.content.activeTabId);
+  const hiddenTabIds = useMemo(() => {
+    const visibleTabIds = new Set(tabs.map((tab) => tab.id));
+    const hiddenIds: string[] = [];
+    for (const tab of node.content.tabs) {
+      if (!visibleTabIds.has(tab.id)) hiddenIds.push(tab.id);
+    }
+    return hiddenIds;
+  }, [node.content.tabs, tabs]);
 
   const cloudEmptyState = useMemo(
     () =>
       isCloud ? (
-        <Flex
-          align="center"
-          justify="center"
-          height="100%"
-          className="bg-(--gray-2)"
-        >
-          <Flex direction="column" align="center" gap="2">
-            <CloudIcon size={24} className="text-gray-10" />
-            <Text color="gray" className="text-sm">
-              Cloud runs are read-only
-            </Text>
-          </Flex>
-        </Flex>
+        <Empty className="h-full border-0 bg-(--gray-2)">
+          <EmptyHeader>
+            <EmptyMedia variant="icon">
+              <CloudIcon size={24} className="text-gray-10" />
+            </EmptyMedia>
+            <EmptyTitle>Cloud runs are read-only</EmptyTitle>
+            <EmptyDescription>
+              Local workspace tools are unavailable for this run.
+            </EmptyDescription>
+          </EmptyHeader>
+        </Empty>
       ) : undefined,
     [isCloud],
   );
@@ -95,8 +107,20 @@ export const LeafNodeRenderer: React.FC<LeafNodeRendererProps> = ({
       onPanelFocus={onPanelFocus}
       draggingTabId={draggingTabId}
       draggingTabPanelId={draggingTabPanelId}
+      allowPanelSplit={!isCloud}
       onAddTerminal={hideTerminal ? undefined : () => onAddTerminal(node.id)}
-      onSplitPanel={(direction) => onSplitPanel(node.id, direction)}
+      onSplitPanel={
+        isCloud ? undefined : (direction) => onSplitPanel(node.id, direction)
+      }
+      onClosePanel={
+        tabs.length === 0 && hiddenTabIds.length > 0
+          ? () => {
+              for (const tabId of hiddenTabIds) {
+                closeTab(taskId, node.id, tabId);
+              }
+            }
+          : undefined
+      }
       emptyState={cloudEmptyState}
     />
   );
diff --git a/packages/ui/src/features/panels/components/TabbedPanel.test.tsx b/packages/ui/src/features/panels/components/TabbedPanel.test.tsx
index 9ba602d936..33ad0313a2 100644
--- a/packages/ui/src/features/panels/components/TabbedPanel.test.tsx
+++ b/packages/ui/src/features/panels/components/TabbedPanel.test.tsx
@@ -3,6 +3,10 @@ import { render, screen } from "@testing-library/react";
 import { describe, expect, it, vi } from "vitest";
 import type { PanelContent } from "../panelTypes";
 
+const panelDropZonesSpy = vi.hoisted(() =>
+  vi.fn((_props: { allowSplit?: boolean }) => null),
+);
+
 vi.mock("@dnd-kit/react", () => ({
   useDroppable: () => ({ ref: vi.fn() }),
 }));
@@ -16,7 +20,7 @@ vi.mock("@posthog/host-router/react", () => ({
 }));
 
 vi.mock("./PanelDropZones", () => ({
-  PanelDropZones: () => null,
+  PanelDropZones: panelDropZonesSpy,
 }));
 
 vi.mock("./PanelTab", () => ({
@@ -52,6 +56,26 @@ function content(activeTabId: string): PanelContent {
 }
 
 describe("TabbedPanel", () => {
+  it("disables split drop zones when panel splitting is unavailable", () => {
+    const droppableContent = { ...content("logs"), droppable: true };
+
+    render(
+      <Theme>
+        <TabbedPanel
+          panelId="main"
+          mountScopeKey="task-a"
+          content={droppableContent}
+          draggingTabId="logs"
+          allowPanelSplit={false}
+        />
+      </Theme>,
+    );
+
+    expect(panelDropZonesSpy.mock.lastCall?.[0]).toEqual(
+      expect.objectContaining({ allowSplit: false }),
+    );
+  });
+
   it("retains visited tabs within a task and resets them for another task", () => {
     const { rerender } = render(
       <Theme>
diff --git a/packages/ui/src/features/panels/components/TabbedPanel.tsx b/packages/ui/src/features/panels/components/TabbedPanel.tsx
index d34ad048ed..3c096ccb88 100644
--- a/packages/ui/src/features/panels/components/TabbedPanel.tsx
+++ b/packages/ui/src/features/panels/components/TabbedPanel.tsx
@@ -1,5 +1,5 @@
 import { useDroppable } from "@dnd-kit/react";
-import { Plus, SquareSplitHorizontalIcon } from "@phosphor-icons/react";
+import { Plus, SquareSplitHorizontalIcon, X } from "@phosphor-icons/react";
 import { useHostTRPCClient } from "@posthog/host-router/react";
 import { PanelDropZones } from "@posthog/ui/features/panels/components/PanelDropZones";
 import type { SplitDirection } from "@posthog/ui/features/panels/panelLayoutStore";
@@ -65,8 +65,10 @@ interface TabbedPanelProps {
   onPanelFocus?: (panelId: string) => void;
   draggingTabId?: string | null;
   draggingTabPanelId?: string | null;
+  allowPanelSplit?: boolean;
   onAddTerminal?: () => void;
   onSplitPanel?: (direction: SplitDirection) => void;
+  onClosePanel?: () => void;
   rightContent?: React.ReactNode;
   emptyState?: React.ReactNode;
 }
@@ -82,8 +84,10 @@ export const TabbedPanel: React.FC<TabbedPanelProps> = ({
   onPanelFocus,
   draggingTabId = null,
   draggingTabPanelId = null,
+  allowPanelSplit = true,
   onAddTerminal,
   onSplitPanel,
+  onClosePanel,
   rightContent,
   emptyState,
 }) => {
@@ -230,12 +234,21 @@ export const TabbedPanel: React.FC<TabbedPanelProps> = ({
               <Box flexShrink="0" className="h-[32px] min-w-[90px]" />
             )}
           </Flex>
-          {(rightContent || (content.droppable && onSplitPanel)) && (
+          {(rightContent ||
+            onClosePanel ||
+            (content.droppable && onSplitPanel)) && (
             <Flex
               align="center"
               className="absolute top-0 right-0 h-[32px] border-b border-b-(--gray-6) border-l border-l-(--gray-6) bg-(--color-background)"
             >
               {rightContent}
+              {onClosePanel && (
+                <Tooltip content="Close panel" side="bottom">
+                  <TabBarButton ariaLabel="Close panel" onClick={onClosePanel}>
+                    <X size={14} />
+                  </TabBarButton>
+                </Tooltip>
+              )}
               {content.droppable && onSplitPanel && (
                 <Tooltip content="Split panel" side="bottom">
                   <TabBarButton
@@ -296,11 +309,12 @@ export const TabbedPanel: React.FC<TabbedPanelProps> = ({
             panelId={panelId}
             isDragging={!!draggingTabId}
             allowSplit={
-              // Allow split if:
+              allowPanelSplit &&
+              // Within a splittable layout, allow the edge drop zones if:
               // 1. Current panel has > 1 tab (same-panel split), OR
               // 2. Dragging from a different panel (cross-panel split)
-              content.tabs.length > 1 ||
-              (draggingTabPanelId !== null && draggingTabPanelId !== panelId)
+              (content.tabs.length > 1 ||
+                (draggingTabPanelId !== null && draggingTabPanelId !== panelId))
             }
           />
         )}
diff --git a/packages/ui/src/features/task-detail/components/TaskHeaderActions.tsx b/packages/ui/src/features/task-detail/components/TaskHeaderActions.tsx
index d69a198bd9..b1b6eb4000 100644
--- a/packages/ui/src/features/task-detail/components/TaskHeaderActions.tsx
+++ b/packages/ui/src/features/task-detail/components/TaskHeaderActions.tsx
@@ -113,7 +113,7 @@ function TaskDiffStatsBadge({ task }: { task: Task }) {
     useDiffStatsToggle(task, "split");
   return (
     <Tooltip
-      content={isOpen ? "Close review panel" : "Open review panel"}
+      content={isOpen ? "Close diff view" : "Open diff view"}
       shortcut={formatHotkey(SHORTCUTS.TOGGLE_REVIEW_PANEL)}
       side="bottom"
     >