diff --git a/src/renderer/components/ChatPane.tsx b/src/renderer/components/ChatPane.tsx
index e9c6ee5..872aa97 100644
--- a/src/renderer/components/ChatPane.tsx
+++ b/src/renderer/components/ChatPane.tsx
@@ -10,7 +10,7 @@ import { PlanReviewBanner } from '@renderer/components/chat/PlanReviewBanner';
 import { McpAuthBanner } from '@renderer/components/chat/McpAuthBanner';
 import { UserInputBanner } from '@renderer/components/chat/UserInputBanner';
 import { InlineApprovalPill, InlineGitPill, InlineModelPill, InlineTerminalPill, InlineThinkingPill, InlineToolsPill } from '@renderer/components/chat/InlinePills';
-import { InlinePromptPill } from '@renderer/components/chat/InlinePromptPill';
+import { InlinePromptPill, type ArmedPrompt } from '@renderer/components/chat/InlinePromptPill';
 import { ThinkingDots } from '@renderer/components/chat/ThinkingDots';
 import { ThinkingProcess } from '@renderer/components/chat/ThinkingProcess';
 import { SubagentActivityList } from '@renderer/components/chat/SubagentActivityCard';
@@ -193,6 +193,7 @@ export function ChatPane({
   const canSubmitInput = hasComposerContent && !isComposerDisabled;
   const [pendingAttachments, setPendingAttachments] = useState<ChatMessageAttachment[]>([]);
   const promptFiles = useMemo(() => project.customization?.promptFiles ?? [], [project.customization?.promptFiles]);
+  const [armedPrompt, setArmedPrompt] = useState<ArmedPrompt | null>(null);
 
   const toolSelection = useMemo(() => resolveSessionToolingSelection(session), [session]);
   const mcpServers = toolingSettings.mcpServers;
@@ -232,13 +233,24 @@ export function ChatPane({
     setIsResolvingApproval(false);
     setIsUpdatingSessionModelConfig(false);
     setEditingMessageId(undefined);
+    setArmedPrompt(null);
   }, [session.id]);
 
   function handleComposerSubmit(content: string) {
     const attachments = pendingAttachments.length > 0 ? [...pendingAttachments] : undefined;
     const messageMode: MessageMode | undefined = isSessionBusy ? 'immediate' : undefined;
     setPendingAttachments([]);
-    void onSend(content, attachments, messageMode);
+
+    if (armedPrompt) {
+      const invocation = { ...armedPrompt.invocation };
+      if (content.trim()) {
+        invocation.resolvedPrompt = `${invocation.resolvedPrompt}\n\n${content.trim()}`;
+      }
+      setArmedPrompt(null);
+      void onSend('', attachments, messageMode, invocation);
+    } else {
+      void onSend(content, attachments, messageMode);
+    }
   }
 
   const handleCopyMessage = useCallback((content: string) => {
@@ -747,21 +759,23 @@ export function ChatPane({
               onContentChange={setHasComposerContent}
               onSubmit={handleComposerSubmit}
               placeholder={
-                pendingApproval
-                  ? 'Awaiting approval...'
-                  : pendingUserInput
-                    ? 'Awaiting your input above...'
-                    : pendingPlanReview
-                      ? 'Review the plan above...'
-                      : pendingMcpAuth
-                        ? 'MCP server requires authentication...'
-                        : isSessionBusy
-                        ? 'Steer the agent (sends immediately)...'
-                        : isUpdatingSessionModelConfig
-                          ? 'Saving model settings...'
-                          : isPlanMode
-                            ? 'Describe what to plan...'
-                            : 'Message...'
+                armedPrompt?.prompt.argumentHint
+                  ? armedPrompt.prompt.argumentHint
+                  : pendingApproval
+                    ? 'Awaiting approval...'
+                    : pendingUserInput
+                      ? 'Awaiting your input above...'
+                      : pendingPlanReview
+                        ? 'Review the plan above...'
+                        : pendingMcpAuth
+                          ? 'MCP server requires authentication...'
+                          : isSessionBusy
+                          ? 'Steer the agent (sends immediately)...'
+                          : isUpdatingSessionModelConfig
+                            ? 'Saving model settings...'
+                            : isPlanMode
+                              ? 'Describe what to plan...'
+                              : 'Message...'
               }
             >
               {/* Bottom action bar: left = shortcuts, right = buttons */}
@@ -785,7 +799,10 @@ export function ChatPane({
                   )}
                   {!isScratchpad && promptFiles.length > 0 && (
                     <InlinePromptPill
+                      armedPrompt={armedPrompt}
                       disabled={isComposerDisabled}
+                      onArm={setArmedPrompt}
+                      onDisarm={() => setArmedPrompt(null)}
                       onSubmit={(promptInvocation) => void onSend('', undefined, undefined, promptInvocation)}
                       promptFiles={promptFiles}
                     />
@@ -847,9 +864,9 @@ export function ChatPane({
                 {/* Send / Stop / Steer button */}
                 <button
                   className={`flex size-8 items-center justify-center rounded-lg transition-all duration-150 ${
-                    isSessionBusy && !hasComposerContent && pendingAttachments.length === 0
+                    isSessionBusy && !hasComposerContent && pendingAttachments.length === 0 && !armedPrompt
                       ? 'bg-[var(--color-status-error)]/80 text-white hover:bg-[var(--color-status-error)]'
-                      : canSubmitInput || pendingAttachments.length > 0
+                      : canSubmitInput || pendingAttachments.length > 0 || armedPrompt
                         ? isSessionBusy
                           ? 'bg-[var(--color-status-warning)] text-white hover:brightness-110'
                           : isPlanMode
@@ -857,9 +874,9 @@ export function ChatPane({
                             : 'brand-gradient-bg text-white shadow-[0_2px_12px_rgba(36,92,249,0.25)] hover:shadow-[0_4px_20px_rgba(36,92,249,0.35)]'
                         : 'bg-[var(--color-surface-2)] text-[var(--color-text-muted)]'
                   }`}
-                  disabled={!canSubmitInput && !isSessionBusy && pendingAttachments.length === 0}
+                  disabled={!canSubmitInput && !isSessionBusy && pendingAttachments.length === 0 && !armedPrompt}
                   onClick={() => {
-                    if (isSessionBusy && !hasComposerContent && pendingAttachments.length === 0) {
+                    if (isSessionBusy && !hasComposerContent && pendingAttachments.length === 0 && !armedPrompt) {
                       onCancelTurn?.();
                     } else {
                       composerRef.current?.submit();
@@ -867,7 +884,7 @@ export function ChatPane({
                   }}
                   type="button"
                   aria-label={
-                    isSessionBusy && !hasComposerContent && pendingAttachments.length === 0
+                    isSessionBusy && !hasComposerContent && pendingAttachments.length === 0 && !armedPrompt
                       ? 'Stop generating'
                       : isSessionBusy
                         ? 'Steer agent'
@@ -933,8 +950,19 @@ export function ChatPane({
 
 /* ── Prompt invocation chrome ───────────────────────────────── */
 
+function formatInvocationSourcePath(sourcePath: string): string {
+  const normalized = sourcePath.replace(/\\/g, '/');
+  const ancestorPrefix = /^(\.\.\/)+(\.github|\.claude)\//;
+  if (ancestorPrefix.test(normalized)) {
+    const segments = normalized.split('/').filter((s) => s !== '..');
+    return `↑ ${segments.join('/')}`;
+  }
+  return normalized;
+}
+
 function PromptInvocationChrome({ invocation }: { invocation: ProjectPromptInvocation }) {
   const [expanded, setExpanded] = useState(false);
+  const isAncestor = invocation.sourcePath.startsWith('..');
 
   return (
     <div className="rounded-xl border border-[var(--color-status-success)]/20 bg-[var(--color-status-success)]/5 px-4 py-3">
@@ -949,6 +977,11 @@ function PromptInvocationChrome({ invocation }: { invocation: ProjectPromptInvoc
           {invocation.name}
         </span>
         <div className="flex items-center gap-1.5">
+          {invocation.model && (
+            <span className="rounded bg-[var(--color-accent-purple)]/15 px-1.5 py-0.5 text-[9px] font-semibold uppercase tracking-wider text-[var(--color-accent-purple)]">
+              {invocation.model}
+            </span>
+          )}
           {invocation.agent && (
             <span className="rounded bg-[var(--color-accent-sky)]/15 px-1.5 py-0.5 text-[9px] font-semibold uppercase tracking-wider text-[var(--color-accent-sky)]">
               {invocation.agent}
@@ -967,7 +1000,16 @@ function PromptInvocationChrome({ invocation }: { invocation: ProjectPromptInvoc
       {invocation.description && (
         <p className="mt-1 pl-6 text-[11px] text-[var(--color-text-muted)]">{invocation.description}</p>
       )}
-      <p className="mt-0.5 pl-6 text-[10px] text-[var(--color-text-muted)]">{invocation.sourcePath}</p>
+      <div className="mt-0.5 flex items-center gap-1.5 pl-6">
+        {isAncestor && (
+          <span className="rounded bg-[var(--color-surface-3)] px-1 py-0.5 text-[9px] font-medium text-[var(--color-text-muted)]">
+            parent repo
+          </span>
+        )}
+        <span className="text-[10px] text-[var(--color-text-muted)]" title={invocation.sourcePath}>
+          {formatInvocationSourcePath(invocation.sourcePath)}
+        </span>
+      </div>
       {expanded && (
         <div className="mt-2.5 rounded-lg border border-[var(--color-border)] bg-[var(--color-surface-1)] p-3">
           <div className="max-h-48 overflow-y-auto text-[12px] leading-relaxed text-[var(--color-text-secondary)]">
diff --git a/src/renderer/components/ProjectSettingsPanel.tsx b/src/renderer/components/ProjectSettingsPanel.tsx
index 8282528..cfc6dbd 100644
--- a/src/renderer/components/ProjectSettingsPanel.tsx
+++ b/src/renderer/components/ProjectSettingsPanel.tsx
@@ -9,6 +9,13 @@ import type { ProjectAgentProfile, ProjectInstructionApplicationMode, ProjectIns
 
 /* ── Types ────────────────────────────────────────────────── */
 
+/** Shortens ancestor-relative source paths like `..\..\..\.github\prompts\x.md` to `↑ .github/prompts/x.md` */
+function formatSettingsSourcePath(sourcePath: string): string {
+  const normalized = sourcePath.replace(/\\/g, '/');
+  const segments = normalized.split('/').filter((s) => s !== '..');
+  return `↑ ${segments.join('/')}`;
+}
+
 type ProjectSettingsSection = 'overview' | 'instructions' | 'agents' | 'prompts' | 'mcp-servers' | 'danger-zone';
 
 interface NavItem {
@@ -335,7 +342,7 @@ function InstructionsContent({
   return (
     <div>
       <SectionHeader
-        description="Repository instructions discovered from copilot-instructions.md, AGENTS.md, CLAUDE.md, and .github/instructions/**/*.instructions.md."
+        description="Repository instructions discovered from copilot-instructions.md, AGENTS.md, CLAUDE.md, .github/instructions/**/*.instructions.md, and .claude/rules/**/*.md."
         title="Instructions"
       >
         <RescanButton onClick={onRescan} />
@@ -343,7 +350,7 @@ function InstructionsContent({
 
       {instructions.length === 0 ? (
         <EmptyState>
-          No instruction files found. Add <code className="text-[var(--color-text-secondary)]">.github/copilot-instructions.md</code>, <code className="text-[var(--color-text-secondary)]">AGENTS.md</code>, <code className="text-[var(--color-text-secondary)]">CLAUDE.md</code>, or <code className="text-[var(--color-text-secondary)]">*.instructions.md</code> files under <code className="text-[var(--color-text-secondary)]">.github/instructions/</code>.
+          No instruction files found. Add <code className="text-[var(--color-text-secondary)]">.github/copilot-instructions.md</code>, <code className="text-[var(--color-text-secondary)]">AGENTS.md</code>, <code className="text-[var(--color-text-secondary)]">CLAUDE.md</code>, <code className="text-[var(--color-text-secondary)]">*.instructions.md</code> files under <code className="text-[var(--color-text-secondary)]">.github/instructions/</code>, or <code className="text-[var(--color-text-secondary)]">*.md</code> files under <code className="text-[var(--color-text-secondary)]">.claude/rules/</code>.
         </EmptyState>
       ) : (
         <div className="space-y-3">
@@ -359,7 +366,8 @@ function InstructionsContent({
 function InstructionCard({ instruction }: { instruction: ProjectInstructionFile }) {
   const [expanded, setExpanded] = useState(false);
   const isLong = instruction.content.length > 300;
-  const displayName = instruction.name ?? instruction.sourcePath;
+  const isAncestor = instruction.sourcePath.startsWith('..');
+  const displayName = instruction.name ?? (isAncestor ? formatSettingsSourcePath(instruction.sourcePath) : instruction.sourcePath);
 
   return (
     <div className="rounded-xl border border-[var(--color-border)] bg-[var(--color-glass)]">
@@ -370,8 +378,13 @@ function InstructionCard({ instruction }: { instruction: ProjectInstructionFile
       >
         <FileCode2 className="size-4 shrink-0 text-[var(--color-text-accent)]" />
         <div className="flex min-w-0 flex-1 items-center gap-2">
-          <span className="truncate text-[13px] font-medium text-[var(--color-text-primary)]">{displayName}</span>
+          <span className="truncate text-[13px] font-medium text-[var(--color-text-primary)]" title={instruction.sourcePath}>{displayName}</span>
           <InstructionModeBadge mode={instruction.applicationMode} />
+          {isAncestor && (
+            <span className="shrink-0 rounded bg-[var(--color-surface-3)] px-1.5 py-0.5 text-[9px] font-medium text-[var(--color-text-muted)]">
+              parent repo
+            </span>
+          )}
           {instruction.applyTo && (
             <span
               className="truncate rounded bg-[var(--color-surface-3)] px-1.5 py-0.5 text-[10px] font-medium text-[var(--color-text-muted)]"
@@ -571,6 +584,8 @@ function PromptsContent({
 }
 
 function PromptCard({ prompt }: { prompt: ProjectPromptFile }) {
+  const isAncestor = prompt.sourcePath.startsWith('..');
+
   return (
     <div className="rounded-xl border border-[var(--color-border)] bg-[var(--color-glass)] px-5 py-4">
       <div className="flex items-start gap-3">
@@ -578,6 +593,11 @@ function PromptCard({ prompt }: { prompt: ProjectPromptFile }) {
         <div className="min-w-0 flex-1">
           <div className="flex items-center gap-2">
             <span className="text-[13px] font-medium text-[var(--color-text-primary)]">{prompt.name}</span>
+            {prompt.model && (
+              <span className="rounded-full bg-[var(--color-accent-purple)]/15 px-2 py-0.5 text-[10px] font-semibold uppercase tracking-wider text-[var(--color-accent-purple)]">
+                {prompt.model}
+              </span>
+            )}
             {prompt.agent && (
               <span className="rounded-full bg-[var(--color-accent-sky)]/15 px-2 py-0.5 text-[10px] font-semibold uppercase tracking-wider text-[var(--color-accent-sky)]">
                 {prompt.agent}
@@ -588,10 +608,20 @@ function PromptCard({ prompt }: { prompt: ProjectPromptFile }) {
                 {prompt.variables.length} variable{prompt.variables.length === 1 ? '' : 's'}
               </span>
             )}
+            {isAncestor && (
+              <span className="rounded-full bg-[var(--color-surface-3)] px-2 py-0.5 text-[9px] font-medium text-[var(--color-text-muted)]">
+                parent repo
+              </span>
+            )}
           </div>
           {prompt.description && (
             <p className="mt-1 text-[12px] leading-relaxed text-[var(--color-text-muted)]">{prompt.description}</p>
           )}
+          {prompt.argumentHint && (
+            <p className="mt-1 text-[11px] italic text-[var(--color-text-muted)]">
+              Hint: {prompt.argumentHint}
+            </p>
+          )}
           {prompt.tools && prompt.tools.length > 0 && (
             <div className="mt-2 flex flex-wrap gap-1.5">
               {prompt.tools.map((tool) => (
@@ -617,7 +647,9 @@ function PromptCard({ prompt }: { prompt: ProjectPromptFile }) {
               ))}
             </div>
           )}
-          <p className="mt-1.5 text-[11px] text-[var(--color-text-muted)]">{prompt.sourcePath}</p>
+          <p className="mt-1.5 text-[11px] text-[var(--color-text-muted)]" title={prompt.sourcePath}>
+            {isAncestor ? formatSettingsSourcePath(prompt.sourcePath) : prompt.sourcePath}
+          </p>
         </div>
       </div>
     </div>
diff --git a/src/renderer/components/chat/InlinePromptPill.tsx b/src/renderer/components/chat/InlinePromptPill.tsx
index 5341fda..4b31776 100644
--- a/src/renderer/components/chat/InlinePromptPill.tsx
+++ b/src/renderer/components/chat/InlinePromptPill.tsx
@@ -22,18 +22,41 @@ function buildPromptInvocation(prompt: ProjectPromptFile, resolvedTemplate: stri
 
   if (prompt.description) invocation.description = prompt.description;
   if (prompt.agent) invocation.agent = prompt.agent;
+  if (prompt.model) invocation.model = prompt.model;
   if (prompt.tools?.length) invocation.tools = prompt.tools;
 
   return invocation;
 }
 
+/** Returns a human-friendly display label for source paths, shortening ancestor-relative segments. */
+function formatPromptSourcePath(sourcePath: string): string {
+  const normalized = sourcePath.replace(/\\/g, '/');
+  const ancestorPrefix = /^(\.\.\/)+(\.github|\.claude)\//;
+  if (ancestorPrefix.test(normalized)) {
+    const segments = normalized.split('/').filter((s) => s !== '..');
+    return `↑ ${segments.join('/')}`;
+  }
+  return normalized;
+}
+
+export interface ArmedPrompt {
+  prompt: ProjectPromptFile;
+  invocation: ProjectPromptInvocation;
+}
+
 export function InlinePromptPill({
   promptFiles,
   disabled,
+  armedPrompt,
+  onArm,
+  onDisarm,
   onSubmit,
 }: {
   promptFiles: ReadonlyArray<ProjectPromptFile>;
   disabled: boolean;
+  armedPrompt?: ArmedPrompt | null;
+  onArm?: (armed: ArmedPrompt) => void;
+  onDisarm?: () => void;
   onSubmit: (invocation: ProjectPromptInvocation) => void;
 }) {
   const [open, setOpen] = useState(false);
@@ -47,23 +70,32 @@ export function InlinePromptPill({
     setVariableValues({});
   }, []);
 
+  const armOrSubmit = useCallback((prompt: ProjectPromptFile, resolvedTemplate: string) => {
+    const invocation = buildPromptInvocation(prompt, resolvedTemplate);
+    if (prompt.argumentHint && onArm) {
+      onArm({ prompt, invocation });
+      handleClose();
+    } else {
+      onSubmit(invocation);
+      handleClose();
+    }
+  }, [onArm, onSubmit, handleClose]);
+
   const handleSelectPrompt = useCallback((prompt: ProjectPromptFile) => {
     if (prompt.variables.length === 0) {
-      onSubmit(buildPromptInvocation(prompt, prompt.template.trim()));
-      handleClose();
+      armOrSubmit(prompt, prompt.template.trim());
     } else {
       setSelectedPrompt(prompt);
       setVariableValues({});
     }
-  }, [onSubmit, handleClose]);
+  }, [armOrSubmit]);
 
   const handleSubmitWithVariables = useCallback(() => {
     if (!selectedPrompt) return;
     const resolved = resolvePromptTemplate(selectedPrompt.template, variableValues).trim();
     if (!resolved) return;
-    onSubmit(buildPromptInvocation(selectedPrompt, resolved));
-    handleClose();
-  }, [selectedPrompt, variableValues, onSubmit, handleClose]);
+    armOrSubmit(selectedPrompt, resolved);
+  }, [selectedPrompt, variableValues, armOrSubmit]);
 
   const handleVariableChange = useCallback((name: string, value: string) => {
     setVariableValues((prev) => ({ ...prev, [name]: value }));
@@ -78,18 +110,31 @@ export function InlinePromptPill({
 
   return (
     <div className="relative" ref={ref}>
-      <button
-        aria-expanded={open}
-        aria-haspopup="listbox"
-        className="inline-flex items-center gap-1 rounded-lg px-2 py-1 text-[11px] font-medium text-[var(--color-text-muted)] transition-all duration-200 hover:bg-[var(--color-surface-3)] hover:text-[var(--color-text-primary)]"
-        disabled={disabled}
-        onClick={() => setOpen(!open)}
-        type="button"
-      >
-        <FileText className="size-3" />
-        Prompts
-        <span className="text-[var(--color-text-muted)]">({promptFiles.length})</span>
-      </button>
+      {armedPrompt ? (
+        <button
+          className="inline-flex items-center gap-1.5 rounded-lg bg-[var(--color-status-success)]/10 px-2.5 py-1 text-[11px] font-medium text-[var(--color-status-success)] transition-all duration-200 hover:bg-[var(--color-status-success)]/20"
+          onClick={() => onDisarm?.()}
+          type="button"
+          aria-label={`Disarm prompt: ${armedPrompt.prompt.name}`}
+        >
+          <FileText className="size-3" />
+          <span className="max-w-[120px] truncate">{armedPrompt.prompt.name}</span>
+          <X className="size-3 opacity-60" />
+        </button>
+      ) : (
+        <button
+          aria-expanded={open}
+          aria-haspopup="listbox"
+          className="inline-flex items-center gap-1 rounded-lg px-2 py-1 text-[11px] font-medium text-[var(--color-text-muted)] transition-all duration-200 hover:bg-[var(--color-surface-3)] hover:text-[var(--color-text-primary)]"
+          disabled={disabled}
+          onClick={() => setOpen(!open)}
+          type="button"
+        >
+          <FileText className="size-3" />
+          Prompts
+          <span className="text-[var(--color-text-muted)]">({promptFiles.length})</span>
+        </button>
+      )}
 
       {open && !disabled && (
         <div
@@ -151,6 +196,11 @@ function PromptList({
                   {prompt.agent}
                 </span>
               )}
+              {prompt.model && (
+                <span className="shrink-0 rounded bg-[var(--color-accent-purple)]/15 px-1.5 py-0.5 text-[9px] font-semibold uppercase tracking-wider text-[var(--color-accent-purple)]">
+                  {prompt.model}
+                </span>
+              )}
             </div>
             {prompt.description && (
               <div className="mt-0.5 truncate text-[11px] text-[var(--color-text-muted)]">
@@ -163,6 +213,11 @@ function PromptList({
                   {prompt.tools.length} tool{prompt.tools.length === 1 ? '' : 's'}
                 </span>
               )}
+              {prompt.argumentHint && (
+                <span className="rounded bg-[var(--color-surface-2)] px-1.5 py-0.5 text-[10px] italic text-[var(--color-text-muted)]">
+                  hint: {prompt.argumentHint}
+                </span>
+              )}
               {prompt.variables.map((v) => (
                 <span
                   key={v.name}
@@ -172,6 +227,11 @@ function PromptList({
                 </span>
               ))}
             </div>
+            {prompt.sourcePath.startsWith('..') && (
+              <div className="mt-0.5 text-[10px] text-[var(--color-text-muted)]">
+                {formatPromptSourcePath(prompt.sourcePath)}
+              </div>
+            )}
           </div>
         </button>
       ))}
@@ -206,8 +266,15 @@ function PromptVariableForm({
           <X className="size-3" />
         </button>
         <div className="min-w-0 flex-1">
-          <div className="truncate text-[12px] font-medium text-[var(--color-text-primary)]">
-            {prompt.name}
+          <div className="flex items-center gap-1.5">
+            <span className="truncate text-[12px] font-medium text-[var(--color-text-primary)]">
+              {prompt.name}
+            </span>
+            {prompt.model && (
+              <span className="shrink-0 rounded bg-[var(--color-accent-purple)]/15 px-1.5 py-0.5 text-[9px] font-semibold uppercase tracking-wider text-[var(--color-accent-purple)]">
+                {prompt.model}
+              </span>
+            )}
           </div>
           {prompt.description && (
             <div className="truncate text-[10px] text-[var(--color-text-muted)]">{prompt.description}</div>
@@ -238,7 +305,7 @@ function PromptVariableForm({
         type="button"
       >
         <ArrowUp className="size-3.5" />
-        Send prompt
+        {prompt.argumentHint ? 'Arm prompt' : 'Send prompt'}
       </button>
     </div>
   );