diff --git a/.changeset/alert-nested-overlay-slot-leak.md b/.changeset/alert-nested-overlay-slot-leak.md
new file mode 100644
index 000000000..a7737a82d
--- /dev/null
+++ b/.changeset/alert-nested-overlay-slot-leak.md
@@ -0,0 +1,5 @@
+---
+"@launchpad-ui/components": patch
+---
+
+Fix `Alert` text styling and semantics leaking when nested inside an overlay (`Dialog`/`Modal`). `Alert` now establishes its own `TextContext`, so an ancestor overlay's `subtitle` slot no longer captures the Alert's `Text` (which previously forced `slot="subtitle"`, inherited the overlay's `id`/`h3` element, and picked up the overlay's subtitle CSS). The `Modal` subtitle rule is also scoped to skip alert-nested text. A bare `<Text>` now works inside an `Alert`, including within a `Dialog`.
diff --git a/packages/components/__tests__/Alert.spec.tsx b/packages/components/__tests__/Alert.spec.tsx
index a4ecf97ee..4fe05897e 100644
--- a/packages/components/__tests__/Alert.spec.tsx
+++ b/packages/components/__tests__/Alert.spec.tsx
@@ -1,7 +1,7 @@
 import { describe, expect, it, vi } from 'vitest';
 
 import { render, screen, userEvent } from '../../../test/utils';
-import { Alert, Heading, Text } from '../src';
+import { Alert, Dialog, Heading, Text } from '../src';
 
 describe('Alert', () => {
 	it('renders', () => {
@@ -28,4 +28,43 @@ describe('Alert', () => {
 		expect(spy).toHaveBeenCalledTimes(1);
 		expect(screen.queryByRole('alert')).toBeNull();
 	});
+
+	// Regression coverage for DSYS-157: a Dialog publishes a `subtitle` slot context
+	// (with its own id/elementType/CSS). Alert must establish its own Text context so a
+	// nested <Text> isn't captured by the Dialog's subtitle slot.
+	describe('nested inside a Dialog (DSYS-157)', () => {
+		it('does not let the Dialog subtitle context leak into the Alert', () => {
+			render(
+				<Dialog>
+					Dialog body
+					<Alert status="warning">
+						<Heading>Alert heading</Heading>
+						<Text slot="subtitle">Alert body text</Text>
+					</Alert>
+				</Dialog>,
+			);
+
+			// The Dialog must not adopt the Alert's text as its accessible description.
+			expect(screen.queryByRole('dialog', { description: 'Alert body text' })).toBeNull();
+
+			// The Alert's text must not be promoted to the Dialog's subtitle element (h3).
+			expect(screen.getByText('Alert body text').tagName).not.toBe('H3');
+		});
+
+		it('allows a bare <Text> inside a nested Alert without a forced slot', () => {
+			expect(() =>
+				render(
+					<Dialog>
+						Dialog body
+						<Alert status="warning">
+							<Heading>Alert heading</Heading>
+							<Text>Bare alert text</Text>
+						</Alert>
+					</Dialog>,
+				),
+			).not.toThrow();
+
+			expect(screen.getByText('Bare alert text')).toBeVisible();
+		});
+	});
 });
diff --git a/packages/components/src/Alert.tsx b/packages/components/src/Alert.tsx
index af65a3ce1..01a0a0998 100644
--- a/packages/components/src/Alert.tsx
+++ b/packages/components/src/Alert.tsx
@@ -5,7 +5,8 @@ import { StatusIcon } from '@launchpad-ui/icons';
 import { useControlledState } from '@react-stately/utils';
 import { cva } from 'class-variance-authority';
 import { HeadingContext } from 'react-aria-components/Heading';
-import { Provider } from 'react-aria-components/slots';
+import { DEFAULT_SLOT, Provider } from 'react-aria-components/slots';
+import { TextContext } from 'react-aria-components/Text';
 
 import { ButtonGroupContext } from './ButtonGroup';
 import { IconButton } from './IconButton';
@@ -99,6 +100,15 @@ const Alert = ({
 					values={[
 						[HeadingContext, { className: styles.heading }],
 						[ButtonGroupContext, { className: styles.buttonGroup }],
+						[
+							TextContext,
+							{
+								slots: {
+									[DEFAULT_SLOT]: {},
+									subtitle: {},
+								},
+							},
+						],
 					]}
 				>
 					{children}
diff --git a/packages/components/src/styles/Modal.module.css b/packages/components/src/styles/Modal.module.css
index 608fd84f8..e0f97fe93 100644
--- a/packages/components/src/styles/Modal.module.css
+++ b/packages/components/src/styles/Modal.module.css
@@ -61,6 +61,18 @@
 		height: 100%;
 	}
 
+	& [role='dialog'] > [slot='subtitle'],
+	& [slot='header'] > [slot='subtitle'] {
+		font: var(--lp-text-body-1-regular);
+		color: var(--lp-color-text-ui-secondary);
+		grid-row: 2;
+		grid-column: 1 / span 2;
+	}
+
+	> [slot='header'] {
+		margin-bottom: var(--lp-size-20);
+	}
+
 	& [slot='header'] {
 		display: grid;
 		grid-template-columns: 1fr;
@@ -83,13 +95,6 @@
 		align-items: center;
 		gap: var(--lp-size-10);
 	}
-
-	& [slot='subtitle'] {
-		font: var(--lp-text-body-1-regular);
-		color: var(--lp-color-text-ui-secondary);
-		grid-row: 2;
-		grid-column: 1 / span 2;
-	}
 }
 
 .defaultSmall {
diff --git a/packages/components/stories/Modal.stories.tsx b/packages/components/stories/Modal.stories.tsx
index 12ee1d4fd..f412620e3 100644
--- a/packages/components/stories/Modal.stories.tsx
+++ b/packages/components/stories/Modal.stories.tsx
@@ -2,6 +2,7 @@ import type { Meta, ReactRenderer, StoryObj } from '@storybook/react-vite';
 import type { ComponentType } from 'react';
 import type { PlayFunction } from 'storybook/internal/types';
 
+import { Alert } from '@launchpad-ui/components';
 import { expect, userEvent, waitFor, within } from 'storybook/test';
 
 import { allModes } from '../../../.storybook/modes';
@@ -112,6 +113,60 @@ export const Drawer: Story = {
 	},
 };
 
+/**
+ * A Modal with a slotted `header`. The `header` groups the `title`, an optional
+ * `subtitle`, and the close button into the overlay's header grid, separate from the
+ * `body` and `footer`.
+ */
+export const WithHeader: Story = {
+	render: (args) => (
+		<DialogTrigger>
+			<Button>Trigger</Button>
+			<ModalOverlay>
+				<Modal {...args}>
+					<Dialog>
+						{({ close }) => (
+							<>
+								<div slot="header">
+									<Heading slot="title">Invite teammates</Heading>
+									<IconButton
+										aria-label="close"
+										icon="cancel"
+										size="small"
+										variant="minimal"
+										onPress={close}
+									/>
+									<Text slot="subtitle">They'll get an email with a link to join.</Text>
+									<Alert status="warning">
+										<Heading>Heads up before archiving</Heading>
+										<Text slot="subtitle">
+											Scenario alert body. Inside the dialog this must use the Alert's text styling,
+											not the Dialog's subtitle styling.
+										</Text>
+									</Alert>
+								</div>
+								<div slot="body">Body text</div>
+								<div slot="footer">
+									<Button slot="close">Cancel</Button>
+									<Button variant="primary">Send invites</Button>
+								</div>
+							</>
+						)}
+					</Dialog>
+				</Modal>
+			</ModalOverlay>
+		</DialogTrigger>
+	),
+	play,
+	parameters: {
+		chromatic: {
+			modes: {
+				mobile: allModes.mobile,
+			},
+		},
+	},
+};
+
 /**
  * Bug reproduction: Dialog closes when clicking a button inside it while Toast is active.
  *
@@ -146,6 +201,14 @@ export const DialogWithActiveToast: Story = {
 													onPress={close}
 												/>
 												<Text slot="subtitle">Try clicking the button below with toast active</Text>
+												<Alert status="info">
+													<Heading>No critical environments to check</Heading>
+													{/* Bare <Text> now works inside an Alert, even within a Dialog. */}
+													<Text>
+														No checks were run because you don't have any critical environments set
+														up.
+													</Text>
+												</Alert>
 											</div>
 											<div slot="body">
 												<p>