diff --git a/.devcontainer/CHANGELOG.md b/.devcontainer/CHANGELOG.md
index a56f290..5126979 100644
--- a/.devcontainer/CHANGELOG.md
+++ b/.devcontainer/CHANGELOG.md
@@ -10,6 +10,13 @@
 #### ChromaTerm
 - **Regex lookbehinds** — replaced alternation inside lookbehinds (`(?<=[\s(]|^)` and `(?<=commit |merge |...)`) with non-capturing groups containing individual lookbehinds (`(?:(?<=[\s(])|^)` and `(?:(?<=commit )|(?<=merge )|...)`) for PCRE2 compatibility
 
+#### Terminal Color Support
+- **devcontainer.json** — added `TERM` and `COLORTERM=truecolor` to `remoteEnv`; Docker defaults to `TERM=xterm` (8 colors) which caused Claude Code and other CLI tools to downgrade rendering
+- **devcontainer.json** — `TERM` uses `${localEnv:TERM:xterm-256color}` to forward the host terminal type (e.g., `xterm-kitty`) instead of unconditionally overriding it
+- **setup-aliases.sh** — added terminal color defaults to managed shell block so tmux panes, `docker exec`, and SSH sessions also get 256-color and truecolor support
+- **kitty-terminfo/README.md** — updated documentation to reflect `localEnv` forwarding and clarify behavior across VS Code vs non-VS Code entry points
+- **CLAUDE.md** — documented `TERM` and `COLORTERM` environment variables in the Environment section
+
 ### Removed
 
 #### VS Code Extensions
diff --git a/.devcontainer/CLAUDE.md b/.devcontainer/CLAUDE.md
index dcfa5f1..9df168b 100644
--- a/.devcontainer/CLAUDE.md
+++ b/.devcontainer/CLAUDE.md
@@ -79,6 +79,8 @@ Rules in `config/defaults/rules/` deploy to `.claude/rules/` on every container
 | `CLAUDE_CONFIG_DIR` | `/workspaces/.claude` |
 | `ANTHROPIC_MODEL` | `claude-opus-4-6` |
 | `WORKSPACE_ROOT` | `/workspaces` |
+| `TERM` | `${localEnv:TERM:xterm-256color}` (via `remoteEnv` — forwards host TERM, falls back to 256-color) |
+| `COLORTERM` | `truecolor` (via `remoteEnv` — enables 24-bit color support) |
 
 All experimental feature flags are in `settings.json` under `env`. Setup steps controlled by boolean flags in `.env`.
 
diff --git a/.devcontainer/devcontainer.json b/.devcontainer/devcontainer.json
index 888969b..27226fd 100755
--- a/.devcontainer/devcontainer.json
+++ b/.devcontainer/devcontainer.json
@@ -10,6 +10,8 @@
 		"CLAUDE_CONFIG_DIR": "/workspaces/.claude",
 		"GH_CONFIG_DIR": "/workspaces/.gh",
 		"TMPDIR": "/workspaces/.tmp",
+		"TERM": "${localEnv:TERM:xterm-256color}",
+		"COLORTERM": "truecolor",
 		"CLAUDECODE": null
 	},
 
diff --git a/.devcontainer/features/kitty-terminfo/README.md b/.devcontainer/features/kitty-terminfo/README.md
index fd2dde0..af5f3c9 100644
--- a/.devcontainer/features/kitty-terminfo/README.md
+++ b/.devcontainer/features/kitty-terminfo/README.md
@@ -14,7 +14,9 @@ Downloads and compiles the official kitty terminfo entry from the [Kitty termina
 
 ## Usage
 
-No configuration needed. Once installed, containers automatically recognize `TERM=xterm-kitty` and provide full capability support.
+The container defaults to `TERM=xterm-256color` with `COLORTERM=truecolor`, which provides full 256-color and 24-bit truecolor support for all terminals.
+
+For Kitty users: the `devcontainer.json` `remoteEnv` uses `${localEnv:TERM:xterm-256color}`, which forwards your host `TERM` into VS Code sessions. If your host sets `TERM=xterm-kitty`, the installed terminfo ensures full Kitty-specific capability support (correct `bce` behavior, status line, etc.). For non-VS Code entry points (tmux, `docker exec`, SSH), `setup-aliases.sh` upgrades `TERM=xterm` to `xterm-256color` but preserves any other value. If no Kitty TERM is forwarded, `xterm-256color` provides equivalent color rendering.
 
 ```bash
 # Verify installation
diff --git a/.devcontainer/scripts/setup-aliases.sh b/.devcontainer/scripts/setup-aliases.sh
index 3e15818..532619a 100755
--- a/.devcontainer/scripts/setup-aliases.sh
+++ b/.devcontainer/scripts/setup-aliases.sh
@@ -74,6 +74,12 @@ export GH_CONFIG_DIR="${GH_CONFIG_DIR:-/workspaces/.gh}"
 export LANG=en_US.UTF-8
 export LC_ALL=en_US.UTF-8
 
+# Terminal color defaults — Docker sets TERM=xterm (8 colors); upgrade to 256-color
+if [ "\$TERM" = "xterm" ] || [ -z "\$TERM" ]; then
+    export TERM=xterm-256color
+fi
+export COLORTERM="\${COLORTERM:-truecolor}"
+
 # Prefer native binary over npm-installed version
 if [ -x "\$HOME/.local/bin/claude" ]; then
     _CLAUDE_BIN="\$HOME/.local/bin/claude"