diff --git a/src/agents/pi-embedded-runner/compact-reasons.test.ts b/src/agents/pi-embedded-runner/compact-reasons.test.ts
new file mode 100644
index 00000000000..85f8101cb58
--- /dev/null
+++ b/src/agents/pi-embedded-runner/compact-reasons.test.ts
@@ -0,0 +1,40 @@
+import { describe, expect, it } from "vitest";
+import { classifyCompactionReason, resolveCompactionFailureReason } from "./compact-reasons.js";
+
+describe("resolveCompactionFailureReason", () => {
+  it("replaces generic compaction cancellation with the safeguard reason", () => {
+    expect(
+      resolveCompactionFailureReason({
+        reason: "Compaction cancelled",
+        safeguardCancelReason:
+          "Compaction safeguard could not resolve an API key for anthropic/claude-opus-4-6.",
+      }),
+    ).toBe("Compaction safeguard could not resolve an API key for anthropic/claude-opus-4-6.");
+  });
+
+  it("preserves non-generic compaction failures", () => {
+    expect(
+      resolveCompactionFailureReason({
+        reason: "Compaction timed out",
+        safeguardCancelReason:
+          "Compaction safeguard could not resolve an API key for anthropic/claude-opus-4-6.",
+      }),
+    ).toBe("Compaction timed out");
+  });
+});
+
+describe("classifyCompactionReason", () => {
+  it('classifies "nothing to compact" as a skip-like reason', () => {
+    expect(classifyCompactionReason("Nothing to compact (session too small)")).toBe(
+      "no_compactable_entries",
+    );
+  });
+
+  it("classifies safeguard messages as guard-blocked", () => {
+    expect(
+      classifyCompactionReason(
+        "Compaction safeguard could not resolve an API key for anthropic/claude-opus-4-6.",
+      ),
+    ).toBe("guard_blocked");
+  });
+});
diff --git a/src/agents/pi-embedded-runner/compact-reasons.ts b/src/agents/pi-embedded-runner/compact-reasons.ts
new file mode 100644
index 00000000000..1772faeaaa2
--- /dev/null
+++ b/src/agents/pi-embedded-runner/compact-reasons.ts
@@ -0,0 +1,59 @@
+function isGenericCompactionCancelledReason(reason: string): boolean {
+  const normalized = reason.trim().toLowerCase();
+  return normalized === "compaction cancelled" || normalized === "error: compaction cancelled";
+}
+
+export function resolveCompactionFailureReason(params: {
+  reason: string;
+  safeguardCancelReason?: string | null;
+}): string {
+  if (isGenericCompactionCancelledReason(params.reason) && params.safeguardCancelReason) {
+    return params.safeguardCancelReason;
+  }
+  return params.reason;
+}
+
+export function classifyCompactionReason(reason?: string): string {
+  const text = (reason ?? "").trim().toLowerCase();
+  if (!text) {
+    return "unknown";
+  }
+  if (text.includes("nothing to compact")) {
+    return "no_compactable_entries";
+  }
+  if (text.includes("below threshold")) {
+    return "below_threshold";
+  }
+  if (text.includes("already compacted")) {
+    return "already_compacted_recently";
+  }
+  if (text.includes("still exceeds target")) {
+    return "live_context_still_exceeds_target";
+  }
+  if (text.includes("guard")) {
+    return "guard_blocked";
+  }
+  if (text.includes("summary")) {
+    return "summary_failed";
+  }
+  if (text.includes("timed out") || text.includes("timeout")) {
+    return "timeout";
+  }
+  if (
+    text.includes("400") ||
+    text.includes("401") ||
+    text.includes("403") ||
+    text.includes("429")
+  ) {
+    return "provider_error_4xx";
+  }
+  if (
+    text.includes("500") ||
+    text.includes("502") ||
+    text.includes("503") ||
+    text.includes("504")
+  ) {
+    return "provider_error_5xx";
+  }
+  return "unknown";
+}
diff --git a/src/agents/pi-embedded-runner/compact.ts b/src/agents/pi-embedded-runner/compact.ts
index 7641afbffd7..219ae9bc028 100644
--- a/src/agents/pi-embedded-runner/compact.ts
+++ b/src/agents/pi-embedded-runner/compact.ts
@@ -64,6 +64,7 @@ import {
   validateAnthropicTurns,
   validateGeminiTurns,
 } from "../pi-embedded-helpers.js";
+import { consumeCompactionSafeguardCancelReason } from "../pi-extensions/compaction-safeguard-runtime.js";
 import { createPreparedEmbeddedPiSettingsManager } from "../pi-project-settings.js";
 import { createOpenClawCodingTools } from "../pi-tools.js";
 import { ensureRuntimePluginsLoaded } from "../runtime-plugins.js";
@@ -83,6 +84,7 @@ import {
   type SkillSnapshot,
 } from "../skills.js";
 import { resolveTranscriptPolicy } from "../transcript-policy.js";
+import { classifyCompactionReason, resolveCompactionFailureReason } from "./compact-reasons.js";
 import {
   compactWithSafetyTimeout,
   resolveCompactionTimeoutMs,
@@ -253,51 +255,6 @@ function summarizeCompactionMessages(messages: AgentMessage[]): CompactionMessag
   };
 }
 
-function classifyCompactionReason(reason?: string): string {
-  const text = (reason ?? "").trim().toLowerCase();
-  if (!text) {
-    return "unknown";
-  }
-  if (text.includes("nothing to compact")) {
-    return "no_compactable_entries";
-  }
-  if (text.includes("below threshold")) {
-    return "below_threshold";
-  }
-  if (text.includes("already compacted")) {
-    return "already_compacted_recently";
-  }
-  if (text.includes("still exceeds target")) {
-    return "live_context_still_exceeds_target";
-  }
-  if (text.includes("guard")) {
-    return "guard_blocked";
-  }
-  if (text.includes("summary")) {
-    return "summary_failed";
-  }
-  if (text.includes("timed out") || text.includes("timeout")) {
-    return "timeout";
-  }
-  if (
-    text.includes("400") ||
-    text.includes("401") ||
-    text.includes("403") ||
-    text.includes("429")
-  ) {
-    return "provider_error_4xx";
-  }
-  if (
-    text.includes("500") ||
-    text.includes("502") ||
-    text.includes("503") ||
-    text.includes("504")
-  ) {
-    return "provider_error_5xx";
-  }
-  return "unknown";
-}
-
 function resolvePostCompactionIndexSyncMode(config?: OpenClawConfig): "off" | "async" | "await" {
   const mode = config?.agents?.defaults?.compaction?.postIndexSync;
   if (mode === "off" || mode === "async" || mode === "await") {
@@ -741,6 +698,7 @@ export async function compactEmbeddedPiSessionDirect(
   });
 
   let restoreSkillEnv: (() => void) | undefined;
+  let compactionSessionManager: unknown = null;
   try {
     const { shouldLoadSkillEntries, skillEntries } = resolveEmbeddedRunSkillEntries({
       workspaceDir: effectiveWorkspace,
@@ -1004,6 +962,7 @@ export async function compactEmbeddedPiSessionDirect(
         allowSyntheticToolResults: transcriptPolicy.allowSyntheticToolResults,
         allowedToolNames,
       });
+      compactionSessionManager = sessionManager;
       trackSessionManagerAccess(params.sessionFile);
       const settingsManager = createPreparedEmbeddedPiSettingsManager({
         cwd: effectiveWorkspace,
@@ -1162,7 +1121,10 @@ export async function compactEmbeddedPiSessionDirect(
           // the sanity check below becomes a no-op instead of crashing compaction.
         }
         const result = await compactWithSafetyTimeout(
-          () => session.compact(params.customInstructions),
+          () => {
+            consumeCompactionSafeguardCancelReason(compactionSessionManager);
+            return session.compact(params.customInstructions);
+          },
           compactionTimeoutMs,
           {
             abortSignal: params.abortSignal,
@@ -1260,7 +1222,10 @@ export async function compactEmbeddedPiSessionDirect(
       await sessionLock.release();
     }
   } catch (err) {
-    const reason = describeUnknownError(err);
+    const reason = resolveCompactionFailureReason({
+      reason: describeUnknownError(err),
+      safeguardCancelReason: consumeCompactionSafeguardCancelReason(compactionSessionManager),
+    });
     return fail(reason);
   } finally {
     restoreSkillEnv?.();
diff --git a/src/agents/pi-extensions/compaction-safeguard-runtime.ts b/src/agents/pi-extensions/compaction-safeguard-runtime.ts
index 42ccb90aa49..902cc9d3df3 100644
--- a/src/agents/pi-extensions/compaction-safeguard-runtime.ts
+++ b/src/agents/pi-extensions/compaction-safeguard-runtime.ts
@@ -17,6 +17,12 @@ export type CompactionSafeguardRuntimeValue = {
   recentTurnsPreserve?: number;
   qualityGuardEnabled?: boolean;
   qualityGuardMaxRetries?: number;
+  /**
+   * Pending human-readable cancel reason from the current safeguard compaction
+   * attempt. OpenClaw consumes this to replace the upstream generic
+   * "Compaction cancelled" message.
+   */
+  cancelReason?: string;
 };
 
 const registry = createSessionManagerRuntimeRegistry<CompactionSafeguardRuntimeValue>();
@@ -24,3 +30,40 @@ const registry = createSessionManagerRuntimeRegistry<CompactionSafeguardRuntimeV
 export const setCompactionSafeguardRuntime = registry.set;
 
 export const getCompactionSafeguardRuntime = registry.get;
+
+export function setCompactionSafeguardCancelReason(
+  sessionManager: unknown,
+  reason: string | undefined,
+): void {
+  const current = getCompactionSafeguardRuntime(sessionManager);
+  const trimmed = reason?.trim();
+
+  if (!current) {
+    if (!trimmed) {
+      return;
+    }
+    setCompactionSafeguardRuntime(sessionManager, { cancelReason: trimmed });
+    return;
+  }
+
+  const next = { ...current };
+  if (trimmed) {
+    next.cancelReason = trimmed;
+  } else {
+    delete next.cancelReason;
+  }
+  setCompactionSafeguardRuntime(sessionManager, next);
+}
+
+export function consumeCompactionSafeguardCancelReason(sessionManager: unknown): string | null {
+  const current = getCompactionSafeguardRuntime(sessionManager);
+  const reason = current?.cancelReason?.trim();
+  if (!reason) {
+    return null;
+  }
+
+  const next = { ...current };
+  delete next.cancelReason;
+  setCompactionSafeguardRuntime(sessionManager, Object.keys(next).length > 0 ? next : null);
+  return reason;
+}
diff --git a/src/agents/pi-extensions/compaction-safeguard.test.ts b/src/agents/pi-extensions/compaction-safeguard.test.ts
index e7032183ce9..2240d86d03f 100644
--- a/src/agents/pi-extensions/compaction-safeguard.test.ts
+++ b/src/agents/pi-extensions/compaction-safeguard.test.ts
@@ -10,7 +10,9 @@ import * as compactionModule from "../compaction.js";
 import { buildEmbeddedExtensionFactories } from "../pi-embedded-runner/extensions.js";
 import { castAgentMessage } from "../test-helpers/agent-message-fixtures.js";
 import {
+  consumeCompactionSafeguardCancelReason,
   getCompactionSafeguardRuntime,
+  setCompactionSafeguardCancelReason,
   setCompactionSafeguardRuntime,
 } from "./compaction-safeguard-runtime.js";
 import compactionSafeguardExtension, { __testing } from "./compaction-safeguard.js";
@@ -539,6 +541,24 @@ describe("compaction-safeguard runtime registry", () => {
     });
   });
 
+  it("consumes cancel reasons without dropping other runtime fields", () => {
+    const sm = {};
+    setCompactionSafeguardRuntime(sm, { maxHistoryShare: 0.6 });
+    setCompactionSafeguardCancelReason(sm, "no API key");
+
+    expect(consumeCompactionSafeguardCancelReason(sm)).toBe("no API key");
+    expect(consumeCompactionSafeguardCancelReason(sm)).toBeNull();
+    expect(getCompactionSafeguardRuntime(sm)).toEqual({ maxHistoryShare: 0.6 });
+  });
+
+  it("clears cancel reason when set to undefined", () => {
+    const sm = {};
+    setCompactionSafeguardCancelReason(sm, "temporary reason");
+    expect(consumeCompactionSafeguardCancelReason(sm)).toBe("temporary reason");
+    setCompactionSafeguardCancelReason(sm, undefined);
+    expect(consumeCompactionSafeguardCancelReason(sm)).toBeNull();
+  });
+
   it("wires oversized safeguard runtime values when config validation is bypassed", () => {
     const sessionManager = {} as unknown as Parameters<
       typeof buildEmbeddedExtensionFactories
diff --git a/src/agents/pi-extensions/compaction-safeguard.ts b/src/agents/pi-extensions/compaction-safeguard.ts
index a9b25a72e6a..85052728a9c 100644
--- a/src/agents/pi-extensions/compaction-safeguard.ts
+++ b/src/agents/pi-extensions/compaction-safeguard.ts
@@ -31,7 +31,10 @@ import {
   composeSplitTurnInstructions,
   resolveCompactionInstructions,
 } from "./compaction-instructions.js";
-import { getCompactionSafeguardRuntime } from "./compaction-safeguard-runtime.js";
+import {
+  getCompactionSafeguardRuntime,
+  setCompactionSafeguardCancelReason,
+} from "./compaction-safeguard-runtime.js";
 
 const log = createSubsystemLogger("compaction-safeguard");
 
@@ -783,6 +786,7 @@ export default function compactionSafeguardExtension(api: ExtensionAPI): void {
     const hasRealTurnPrefix = preparation.turnPrefixMessages.some((message, index, messages) =>
       isRealConversationMessage(message, messages, index),
     );
+    setCompactionSafeguardCancelReason(ctx.sessionManager, undefined);
     if (!hasRealSummarizable && !hasRealTurnPrefix) {
       // When there are no summarizable messages AND no real turn-prefix content,
       // cancelling compaction leaves context unchanged but the SDK re-triggers
@@ -840,6 +844,10 @@ export default function compactionSafeguardExtension(api: ExtensionAPI): void {
             "was not called and model was not passed through runtime registry.",
         );
       }
+      setCompactionSafeguardCancelReason(
+        ctx.sessionManager,
+        "Compaction safeguard could not resolve a summarization model.",
+      );
       return { cancel: true };
     }
 
@@ -848,6 +856,10 @@ export default function compactionSafeguardExtension(api: ExtensionAPI): void {
       log.warn(
         "Compaction safeguard: no API key available; cancelling compaction to preserve history.",
       );
+      setCompactionSafeguardCancelReason(
+        ctx.sessionManager,
+        `Compaction safeguard could not resolve an API key for ${model.provider}/${model.id}.`,
+      );
       return { cancel: true };
     }
 
@@ -1103,10 +1115,13 @@ export default function compactionSafeguardExtension(api: ExtensionAPI): void {
         },
       };
     } catch (error) {
+      const message = error instanceof Error ? error.message : String(error);
       log.warn(
-        `Compaction summarization failed; cancelling compaction to preserve history: ${
-          error instanceof Error ? error.message : String(error)
-        }`,
+        `Compaction summarization failed; cancelling compaction to preserve history: ${message}`,
+      );
+      setCompactionSafeguardCancelReason(
+        ctx.sessionManager,
+        `Compaction safeguard could not summarize the session: ${message}`,
       );
       return { cancel: true };
     }
diff --git a/src/auto-reply/reply/commands-compact.ts b/src/auto-reply/reply/commands-compact.ts
index 9c3c9f28c29..14ba1fe7a16 100644
--- a/src/auto-reply/reply/commands-compact.ts
+++ b/src/auto-reply/reply/commands-compact.ts
@@ -44,6 +44,35 @@ function extractCompactInstructions(params: {
   return rest.length ? rest : undefined;
 }
 
+function isCompactionSkipReason(reason?: string): boolean {
+  const text = reason?.trim().toLowerCase() ?? "";
+  return (
+    text.includes("nothing to compact") ||
+    text.includes("below threshold") ||
+    text.includes("already compacted") ||
+    text.includes("no real conversation messages")
+  );
+}
+
+function formatCompactionReason(reason?: string): string | undefined {
+  const text = reason?.trim();
+  if (!text) {
+    return undefined;
+  }
+
+  const lower = text.toLowerCase();
+  if (lower.includes("nothing to compact")) {
+    return "context is below the compaction threshold";
+  }
+  if (lower.includes("already compacted")) {
+    return "session was already compacted recently";
+  }
+  if (lower.includes("no real conversation messages")) {
+    return "no real conversation messages yet";
+  }
+  return text;
+}
+
 export const handleCompactCommand: CommandHandler = async (params) => {
   const compactRequested =
     params.command.commandBodyNormalized === "/compact" ||
@@ -110,15 +139,16 @@ export const handleCompactCommand: CommandHandler = async (params) => {
     ownerNumbers: params.command.ownerList.length > 0 ? params.command.ownerList : undefined,
   });
 
-  const compactLabel = result.ok
-    ? result.compacted
-      ? result.result?.tokensBefore != null && result.result?.tokensAfter != null
-        ? `Compacted (${formatTokenCount(result.result.tokensBefore)} → ${formatTokenCount(result.result.tokensAfter)})`
-        : result.result?.tokensBefore
-          ? `Compacted (${formatTokenCount(result.result.tokensBefore)} before)`
-          : "Compacted"
-      : "Compaction skipped"
-    : "Compaction failed";
+  const compactLabel =
+    result.ok || isCompactionSkipReason(result.reason)
+      ? result.compacted
+        ? result.result?.tokensBefore != null && result.result?.tokensAfter != null
+          ? `Compacted (${formatTokenCount(result.result.tokensBefore)} → ${formatTokenCount(result.result.tokensAfter)})`
+          : result.result?.tokensBefore
+            ? `Compacted (${formatTokenCount(result.result.tokensBefore)} before)`
+            : "Compacted"
+        : "Compaction skipped"
+      : "Compaction failed";
   if (result.ok && result.compacted) {
     await incrementCompactionCount({
       sessionEntry: params.sessionEntry,
@@ -136,7 +166,7 @@ export const handleCompactCommand: CommandHandler = async (params) => {
     typeof totalTokens === "number" && totalTokens > 0 ? totalTokens : null,
     params.contextTokens ?? params.sessionEntry.contextTokens ?? null,
   );
-  const reason = result.reason?.trim();
+  const reason = formatCompactionReason(result.reason);
   const line = reason
     ? `${compactLabel}: ${reason} • ${contextSummary}`
     : `${compactLabel} • ${contextSummary}`;
diff --git a/src/auto-reply/reply/commands.test.ts b/src/auto-reply/reply/commands.test.ts
index 6e50d387e63..e1399b19888 100644
--- a/src/auto-reply/reply/commands.test.ts
+++ b/src/auto-reply/reply/commands.test.ts
@@ -120,6 +120,7 @@ const { clearPluginCommands, registerPluginCommand } = await import("../../plugi
 const { abortEmbeddedPiRun, compactEmbeddedPiSession } =
   await import("../../agents/pi-embedded.js");
 const { __testing: subagentControlTesting } = await import("../../agents/subagent-control.js");
+const { enqueueSystemEvent } = await import("../../infra/system-events.js");
 const { resetBashChatCommandForTests } = await import("./bash-command.js");
 const { handleCompactCommand } = await import("./commands-compact.js");
 const { buildCommandsPaginationKeyboard } = await import("./commands-info.js");
@@ -625,6 +626,76 @@ describe("/compact command", () => {
       }),
     );
   });
+
+  it("labels benign no-op compaction results as skipped", async () => {
+    const cfg = {
+      commands: { text: true },
+      channels: { whatsapp: { allowFrom: ["*"] } },
+    } as OpenClawConfig;
+    const params = buildParams("/compact", cfg);
+    vi.mocked(compactEmbeddedPiSession).mockResolvedValueOnce({
+      ok: false,
+      compacted: false,
+      reason: "Nothing to compact (session too small)",
+    });
+
+    const result = await handleCompactCommand(
+      {
+        ...params,
+        sessionEntry: {
+          sessionId: "session-1",
+          updatedAt: Date.now(),
+          totalTokens: 31_000,
+          contextTokens: 200_000,
+        },
+      },
+      true,
+    );
+
+    expect(result).toEqual({
+      shouldContinue: false,
+      reply: {
+        text: "⚙️ Compaction skipped: context is below the compaction threshold • Context 31k/?",
+      },
+    });
+    expect(vi.mocked(enqueueSystemEvent)).toHaveBeenCalledWith(
+      "Compaction skipped: context is below the compaction threshold • Context 31k/?",
+      { sessionKey: params.sessionKey },
+    );
+  });
+
+  it("keeps true compaction errors labeled as failures", async () => {
+    const cfg = {
+      commands: { text: true },
+      channels: { whatsapp: { allowFrom: ["*"] } },
+    } as OpenClawConfig;
+    const params = buildParams("/compact", cfg);
+    vi.mocked(compactEmbeddedPiSession).mockResolvedValueOnce({
+      ok: false,
+      compacted: false,
+      reason: "Compaction safeguard could not resolve an API key for anthropic/claude-opus-4-6.",
+    });
+
+    const result = await handleCompactCommand(
+      {
+        ...params,
+        sessionEntry: {
+          sessionId: "session-1",
+          updatedAt: Date.now(),
+          totalTokens: 109_000,
+          contextTokens: 200_000,
+        },
+      },
+      true,
+    );
+
+    expect(result).toEqual({
+      shouldContinue: false,
+      reply: {
+        text: "⚙️ Compaction failed: Compaction safeguard could not resolve an API key for anthropic/claude-opus-4-6. • Context 109k/?",
+      },
+    });
+  });
 });
 
 describe("abort trigger command", () => {