diff --git a/packages/ui/src/container.ts b/packages/ui/src/container.ts
index 4dc13233..39238b43 100644
--- a/packages/ui/src/container.ts
+++ b/packages/ui/src/container.ts
@@ -821,14 +821,20 @@ function wireContainerHandlers(
         }
 
         return fromPromise(
-          showPermissionRequestModal(label, "Notifications").then(() => {
-            setPermissionStatus(label, "Notifications", "granted");
-          }),
-          () => "denied" as const,
+          showPermissionRequestModal(label, "Notifications"),
+          () => "dismissed" as const,
         )
-          .map(() => true)
+          .map((decision) => {
+            if (decision === "granted") {
+              setPermissionStatus(label, "Notifications", "granted");
+              return true;
+            }
+            if (decision === "denied") {
+              setPermissionStatus(label, "Notifications", "denied");
+            }
+            return false;
+          })
           .orElse(() => {
-            setPermissionStatus(label, "Notifications", "denied");
             return ok(false);
           });
       }
@@ -858,29 +864,31 @@ function wireContainerHandlers(
 
       // status === 'ask': show consent modal
       return fromPromise(
-        showPermissionRequestModal(label, permission).then(() => {
-          setPermissionStatus(label, permission, "granted");
-          // Defer the reload to the next event loop tick so the
-          // container can finish sending the response before being
-          // disposed. Without this, cleanup() runs synchronously
-          // inside the dispatch, disposing the transport mid-response.
-          setTimeout(() => {
-            window.dispatchEvent(
-              new CustomEvent("dotli:device-permission-changed", {
-                detail: { label, permission },
-              }),
-            );
-          }, 0);
-        }),
-        () => "denied" as const,
+        showPermissionRequestModal(label, permission),
+        () => "dismissed" as const,
       )
-        .map(() => {
-          // User allowed, but the iframe reloads, so return false for now
+        .map((decision) => {
+          if (decision === "granted") {
+            setPermissionStatus(label, permission, "granted");
+            // Defer the reload to the next event loop tick so the
+            // container can finish sending the response before being
+            // disposed. Without this, cleanup() runs synchronously
+            // inside the dispatch, disposing the transport mid-response.
+            setTimeout(() => {
+              window.dispatchEvent(
+                new CustomEvent("dotli:device-permission-changed", {
+                  detail: { label, permission },
+                }),
+              );
+            }, 0);
+          } else if (decision === "denied") {
+            setPermissionStatus(label, permission, "denied");
+          }
+          // User allowed reloads the iframe, so return false for now. Deny and
+          // dismiss also fail closed for this request.
           return false;
         })
         .orElse(() => {
-          // User denied (rejected promise) or dialog dismissed
-          setPermissionStatus(label, permission, "denied");
           return ok(false);
         });
     }),
@@ -1290,19 +1298,25 @@ function promptCachedSubmitPermission(
   }
 
   return fromPromise(
-    showPermissionRequestModal(productLabel, storageKey).then(() => {
-      setPermissionStatus(productLabel, storageKey, "granted");
-      window.dispatchEvent(
-        new CustomEvent("dotli:permission-changed", {
-          detail: { label: productLabel },
-        }),
-      );
-    }),
-    () => "denied" as const,
+    showPermissionRequestModal(productLabel, storageKey),
+    () => "dismissed" as const,
   )
-    .map(() => true)
+    .map((decision) => {
+      if (decision === "granted") {
+        setPermissionStatus(productLabel, storageKey, "granted");
+        window.dispatchEvent(
+          new CustomEvent("dotli:permission-changed", {
+            detail: { label: productLabel },
+          }),
+        );
+        return true;
+      }
+      if (decision === "denied") {
+        setPermissionStatus(productLabel, storageKey, "denied");
+      }
+      return false;
+    })
     .orElse(() => {
-      setPermissionStatus(productLabel, storageKey, "denied");
       return okAsync(false);
     });
 }
diff --git a/packages/ui/src/permission-modal.ts b/packages/ui/src/permission-modal.ts
index d99f53fc..16bf18fc 100644
--- a/packages/ui/src/permission-modal.ts
+++ b/packages/ui/src/permission-modal.ts
@@ -14,7 +14,8 @@ import {
 // Biometrics, Notifications) and the internal submitted gates (ChainSubmit,
 // PreimageSubmit, StatementSubmit). `OpenUrl` is auto-granted at the
 // container level and never reaches this modal.
-// Returns a Promise that resolves on "Allow" and rejects on "Deny".
+// Returns an explicit decision so callers can distinguish "Deny" from
+// dismissing the dialog without storing a denial.
 //
 // DOM structure follows the signing modal pattern (signing.css).
 
@@ -93,15 +94,16 @@ const PERMISSION_ICONS: Record<EnforceablePermissionName, string> = {
     '<circle cx="12" cy="7" r="4"/></svg>',
 };
 
+export type PermissionPromptDecision = "granted" | "denied" | "dismissed";
+
 /**
- * Show a permission request modal. Resolves when the user clicks "Allow",
- * rejects when the user clicks "Deny".
+ * Show a permission request modal.
  */
 export function showPermissionRequestModal(
   label: string,
   permission: EnforceablePermissionName,
-): Promise<void> {
-  return new Promise((resolve, reject) => {
+): Promise<PermissionPromptDecision> {
+  return new Promise((resolve) => {
     const backdrop = document.createElement("div");
     backdrop.className = "signing-modal-backdrop";
 
@@ -187,19 +189,19 @@ export function showPermissionRequestModal(
 
     denyBtn.addEventListener("click", () => {
       cleanup();
-      reject(new Error("User denied permission"));
+      resolve("denied");
     });
 
     allowBtn.addEventListener("click", () => {
       cleanup();
-      resolve();
+      resolve("granted");
     });
 
     // Close on backdrop click (outside modal)
     backdrop.addEventListener("click", (e) => {
       if (e.target === backdrop) {
         cleanup();
-        reject(new Error("User dismissed permission dialog"));
+        resolve("dismissed");
       }
     });
   });
diff --git a/packages/ui/tests/permission-modal.test.ts b/packages/ui/tests/permission-modal.test.ts
new file mode 100644
index 00000000..bb3d657a
--- /dev/null
+++ b/packages/ui/tests/permission-modal.test.ts
@@ -0,0 +1,32 @@
+import { afterEach, describe, expect, it } from "vitest";
+import { showPermissionRequestModal } from "@dotli/ui/permission-modal";
+
+afterEach(() => {
+  document.body.replaceChildren();
+});
+
+describe("permission request modal", () => {
+  it("resolves granted when the user allows", async () => {
+    const decision = showPermissionRequestModal("myapp", "Camera");
+
+    document.querySelector<HTMLButtonElement>(".signing-btn-sign")?.click();
+
+    await expect(decision).resolves.toBe("granted");
+  });
+
+  it("resolves denied when the user denies", async () => {
+    const decision = showPermissionRequestModal("myapp", "Camera");
+
+    document.querySelector<HTMLButtonElement>(".signing-btn-cancel")?.click();
+
+    await expect(decision).resolves.toBe("denied");
+  });
+
+  it("resolves dismissed when the backdrop is clicked", async () => {
+    const decision = showPermissionRequestModal("myapp", "Camera");
+
+    document.querySelector<HTMLDivElement>(".signing-modal-backdrop")?.click();
+
+    await expect(decision).resolves.toBe("dismissed");
+  });
+});