diff --git a/src/runtime/dispatch.zig b/src/runtime/dispatch.zig
index 84dbe3d..cb8d234 100644
--- a/src/runtime/dispatch.zig
+++ b/src/runtime/dispatch.zig
@@ -15,16 +15,22 @@ const ResolvedAgent = types.ResolvedAgent;
 
 /// Dispatch an agent run to the appropriate backend.
 /// Writes the agent's text output to `out`.
+/// If all backends fail to produce output, writes an error message to `out`
+/// so the MCP caller knows the dispatch did not succeed.
 pub fn dispatch(
     alloc: std.mem.Allocator,
     resolved: ResolvedAgent,
     prompt: []const u8,
     out: *std.ArrayList(u8),
 ) void {
+    const before = out.items.len;
     switch (resolved.backend) {
         .claude => spawnClaude(alloc, resolved, prompt, out),
         .codex  => spawnCodex(alloc, resolved, prompt, out),
     }
+    if (out.items.len == before) {
+        out.appendSlice(alloc, "[dispatch] backend produced no output — agent run may have failed") catch {};
+    }
 }
 
 // ── Claude backend ────────────────────────────────────────────────────────
@@ -50,10 +56,12 @@ fn spawnClaude(
         .cwd              = resolved.cwd,
     };
 
-    const full_prompt = if (resolved.system_prompt.len > 0)
-        std.fmt.allocPrint(alloc, "{s}{s}", .{ resolved.system_prompt, prompt }) catch prompt
-    else
-        prompt;
+    const full_prompt = if (resolved.system_prompt.len > 0) blk: {
+        break :blk std.fmt.allocPrint(alloc, "{s}{s}", .{ resolved.system_prompt, prompt }) catch {
+            std.debug.print("[dispatch] OOM: system prompt dropped for claude backend\n", .{});
+            break :blk prompt;
+        };
+    } else prompt;
     defer if (full_prompt.ptr != prompt.ptr) alloc.free(full_prompt);
 
     if (sdk.tryClaudeAgent(alloc, full_prompt, opts, out)) return;
@@ -74,11 +82,12 @@ fn spawnCodex(
 
     const policy: cas.SandboxPolicy = if (resolved.writable) .writable else .read_only;
 
-    // Prepend system prompt to the user's prompt
-    const full_prompt = if (resolved.system_prompt.len > 0)
-        std.fmt.allocPrint(alloc, "{s}{s}", .{ resolved.system_prompt, prompt }) catch prompt
-    else
-        prompt;
+    const full_prompt = if (resolved.system_prompt.len > 0) blk: {
+        break :blk std.fmt.allocPrint(alloc, "{s}{s}", .{ resolved.system_prompt, prompt }) catch {
+            std.debug.print("[dispatch] OOM: system prompt dropped for codex backend\n", .{});
+            break :blk prompt;
+        };
+    } else prompt;
     defer if (full_prompt.ptr != prompt.ptr) alloc.free(full_prompt);
 
     cas.runTurnPolicy(alloc, full_prompt, out, policy);
@@ -93,3 +102,31 @@ test "dispatch: Backend.label is correct" {
     try std.testing.expectEqualStrings("claude", Backend.claude.label());
     try std.testing.expectEqualStrings("codex", Backend.codex.label());
 }
+
+test "dispatch: empty output sentinel is written when backend produces nothing" {
+    const sentinel = "[dispatch] backend produced no output — agent run may have failed";
+    var out: std.ArrayList(u8) = .empty;
+    const alloc = std.testing.allocator;
+    defer out.deinit(alloc);
+
+    const before = out.items.len;
+    // Simulate the check that dispatch() does after a backend call:
+    if (out.items.len == before) {
+        out.appendSlice(alloc, sentinel) catch {};
+    }
+    try std.testing.expectEqualStrings(sentinel, out.items);
+}
+
+test "dispatch: non-empty output does not get sentinel appended" {
+    const alloc = std.testing.allocator;
+    var out: std.ArrayList(u8) = .empty;
+    defer out.deinit(alloc);
+
+    try out.appendSlice(alloc, "agent reply");
+    const before = out.items.len;
+    // Simulate: backend already wrote output
+    if (out.items.len == before) {
+        out.appendSlice(alloc, "SHOULD NOT APPEAR") catch {};
+    }
+    try std.testing.expectEqualStrings("agent reply", out.items);
+}