diff --git a/apps/desktop/src/features/chat/transcript/AssistantTurnParts.tsx b/apps/desktop/src/features/chat/transcript/AssistantTurnParts.tsx
index 48587f6eb..a070d88e0 100644
--- a/apps/desktop/src/features/chat/transcript/AssistantTurnParts.tsx
+++ b/apps/desktop/src/features/chat/transcript/AssistantTurnParts.tsx
@@ -19,7 +19,7 @@ const SmoothMessageBubble = memo(function SmoothMessageBubble({ message, streami
     window.matchMedia("(prefers-reduced-motion: reduce)").matches;
   const enabled = smoothStreaming && !prefersReducedMotion;
   const displayContent = useSmoothText(message.content || "", streaming, enabled);
-  const showCursor = streaming && enabled && (displayContent.length < (message.content || "").length);
+  const showCursor = streaming && enabled && Boolean(displayContent);
   return (
     <div
       className={`message-bubble assistant-turn-fragment${streaming ? " streaming" : ""}${showCursor ? " smooth-cursor" : ""}`}
diff --git a/apps/desktop/src/styles/messages.css b/apps/desktop/src/styles/messages.css
index 5fdec5615..76d26cdab 100644
--- a/apps/desktop/src/styles/messages.css
+++ b/apps/desktop/src/styles/messages.css
@@ -3275,14 +3275,22 @@
   font-size: var(--text-sm);
 }
 
-/* ── Smooth streaming cursor ── */
+/* ── Smooth streaming cursor and layout stabilization ── */
 
 @keyframes smooth-stream-blink {
   0%, 100% { opacity: 1; }
   50% { opacity: 0; }
 }
 
-.assistant-turn-fragment.smooth-cursor .prose-chat > :last-child::after {
+.assistant-turn-fragment.streaming .prose-chat {
+  text-wrap: wrap;
+}
+
+.assistant-turn-fragment.smooth-cursor .prose-chat > :last-child:not(ul):not(ol):not(blockquote):not(pre):not(table):not(.table-wrap)::after,
+.assistant-turn-fragment.smooth-cursor .prose-chat > :is(ul, ol):last-child li:last-child:not(:has(ul, ol)):not(:has(p))::after,
+.assistant-turn-fragment.smooth-cursor .prose-chat > :is(ul, ol):last-child li:last-child > :last-child::after,
+.assistant-turn-fragment.smooth-cursor .prose-chat > blockquote:last-child > :last-child::after,
+.assistant-turn-fragment.smooth-cursor .prose-chat > pre:last-child > code::after {
   content: "";
   display: inline-block;
   width: 2px;
@@ -3294,7 +3302,11 @@
 }
 
 @media (prefers-reduced-motion: reduce) {
-  .assistant-turn-fragment.smooth-cursor .prose-chat > :last-child::after {
+  .assistant-turn-fragment.smooth-cursor .prose-chat > :last-child:not(ul):not(ol):not(blockquote):not(pre):not(table):not(.table-wrap)::after,
+  .assistant-turn-fragment.smooth-cursor .prose-chat > :is(ul, ol):last-child li:last-child:not(:has(ul, ol)):not(:has(p))::after,
+  .assistant-turn-fragment.smooth-cursor .prose-chat > :is(ul, ol):last-child li:last-child > :last-child::after,
+  .assistant-turn-fragment.smooth-cursor .prose-chat > blockquote:last-child > :last-child::after,
+  .assistant-turn-fragment.smooth-cursor .prose-chat > pre:last-child > code::after {
     animation: none;
     opacity: 0.7;
   }
diff --git a/apps/desktop/test/chat-streaming-layout.test.mjs b/apps/desktop/test/chat-streaming-layout.test.mjs
new file mode 100644
index 000000000..e44b9f6df
--- /dev/null
+++ b/apps/desktop/test/chat-streaming-layout.test.mjs
@@ -0,0 +1,47 @@
+import assert from "node:assert/strict";
+import { readFile } from "node:fs/promises";
+import test from "node:test";
+
+const assistantTurnPartsSource = await readFile(
+  new URL("../src/features/chat/transcript/AssistantTurnParts.tsx", import.meta.url),
+  "utf8",
+);
+const messagesCss = await readFile(
+  new URL("../src/styles/messages.css", import.meta.url),
+  "utf8",
+);
+
+test("streaming cursor remains steady throughout active streaming without flapping", () => {
+  // Must not flap on/off between network chunks when buffer catches up with current source length
+  assert.match(
+    assistantTurnPartsSource,
+    /const showCursor = streaming && enabled && Boolean\(displayContent\);/,
+  );
+  assert.doesNotMatch(
+    assistantTurnPartsSource,
+    /displayContent\.length < \(message\.content \|\| ""\)\.length/,
+  );
+});
+
+test("streaming prose chat stabilizes line wrapping against orphan-rebalancing reflow", () => {
+  assert.match(
+    messagesCss,
+    /\.assistant-turn-fragment\.streaming \.prose-chat\s*\{\s*text-wrap:\s*wrap;\s*\}/,
+  );
+});
+
+test("streaming cursor attaches to inline leaf blocks and list items instead of container lists", () => {
+  // List cursor must be placed on the last li / last li's child to prevent orphan line boxes under ul/ol
+  assert.match(
+    messagesCss,
+    /\.assistant-turn-fragment\.smooth-cursor \.prose-chat > :is\(ul, ol\):last-child li:last-child:not\(:has\(ul, ol\)\):not\(:has\(p\)\)::after/,
+  );
+  assert.match(
+    messagesCss,
+    /\.assistant-turn-fragment\.smooth-cursor \.prose-chat > :is\(ul, ol\):last-child li:last-child > :last-child::after/,
+  );
+  assert.match(
+    messagesCss,
+    /\.assistant-turn-fragment\.smooth-cursor \.prose-chat > :last-child:not\(ul\):not\(ol\)/,
+  );
+});