diff --git a/filters/src/guardrails/filter.rs b/filters/src/guardrails/filter.rs
index 9807390d15..7e2bc2a89e 100644
--- a/filters/src/guardrails/filter.rs
+++ b/filters/src/guardrails/filter.rs
@@ -164,9 +164,10 @@ fn record_verdict(ctx: &mut HttpFilterContext<'_>, result: GuardResult) -> Resul
             Ok(FilterAction::Reject(Rejection::status(403).with_body(reason)))
         },
         GuardResult::Redact { reason, .. } => {
-            // Full body replacement deferred to #579 (NeMo mask/redact action).
-            tracing::warn!(verdict, %reason, "ai_guardrails: provider verdict; forwarding unchanged until #579");
-            Ok(FilterAction::Continue)
+            // Fail closed: the original content must not be forwarded while the
+            // status is recorded as redacted.
+            tracing::warn!(verdict, %reason, "ai_guardrails: redact verdict; rejecting request");
+            Ok(FilterAction::Reject(Rejection::status(403).with_body(reason)))
         },
     }
 }
diff --git a/filters/src/guardrails/tests.rs b/filters/src/guardrails/tests.rs
index e454cfc756..83c46d942d 100644
--- a/filters/src/guardrails/tests.rs
+++ b/filters/src/guardrails/tests.rs
@@ -339,10 +339,8 @@ async fn on_request_body_blocked_writes_filter_results() {
     );
 }
 
-#[tokio::test]
-async fn on_request_body_modified_writes_filter_results() {
+async fn nemo_pii_redact_filter() -> (Box<dyn praxis_filter::HttpFilter>, wiremock::MockServer) {
     use wiremock::{Mock, MockServer, ResponseTemplate, matchers::method};
-
     let mock_server = MockServer::start().await;
     Mock::given(method("POST"))
         .respond_with(ResponseTemplate::new(200).set_body_json(serde_json::json!({
@@ -352,24 +350,53 @@ async fn on_request_body_modified_writes_filter_results() {
         })))
         .mount(&mock_server)
         .await;
+    let filter = nemo_filter(&format!("{}/v1/guardrail/checks", mock_server.uri()));
+    (filter, mock_server)
+}
 
-    let endpoint = format!("{}/v1/guardrail/checks", mock_server.uri());
-    let filter = nemo_filter(&endpoint);
+#[tokio::test]
+async fn on_request_body_modified_rejects_with_403() {
+    let (filter, _server) = nemo_pii_redact_filter().await;
     let req = crate::test_utils::make_request(http::Method::POST, "/v1/chat");
     let mut ctx = crate::test_utils::make_filter_context(&req);
     let mut body = Some(bytes::Bytes::from_static(
         br#"{"messages":[{"role":"user","content":"my ssn is 123-45-6789"}]}"#,
     ));
 
-    let action = filter.on_request_body(&mut ctx, &mut body, true).await.unwrap();
+    let rejection = as_rejection(filter.on_request_body(&mut ctx, &mut body, true).await.unwrap());
+    assert_eq!(
+        rejection.status, 403,
+        "redact verdict must reject with HTTP 403"
+    );
+    let body_text = String::from_utf8_lossy(rejection.body.as_deref().unwrap_or_default());
     assert!(
-        matches!(action, praxis_filter::FilterAction::Continue),
-        "modified verdict should forward unchanged (redact placeholder deferred to #579)"
+        body_text.contains("pii masking"),
+        "rejection body should include the blocked rail name, got: {body_text}"
+    );
+    assert_eq!(
+        ctx.filter_results.get("ai_guardrails").unwrap().get("status"),
+        Some("redacted"),
+        "redact verdict should record 'redacted' status in filter_results even when rejecting"
+    );
+}
+
+#[tokio::test]
+async fn on_request_body_modified_never_forwards_original_secret() {
+    let (filter, _server) = nemo_pii_redact_filter().await;
+    let req = crate::test_utils::make_request(http::Method::POST, "/v1/chat");
+    let mut ctx = crate::test_utils::make_filter_context(&req);
+    let original_body = br#"{"messages":[{"role":"user","content":"my ssn is 123-45-6789"}]}"#;
+    let mut body = Some(bytes::Bytes::from_static(original_body));
+
+    let rejection = as_rejection(filter.on_request_body(&mut ctx, &mut body, true).await.unwrap());
+    assert!(
+        !String::from_utf8_lossy(&rejection.body.clone().unwrap_or_default()).contains("123-45-6789"),
+        "the original secret must not appear in the rejection body"
     );
     assert_eq!(
         ctx.filter_results.get("ai_guardrails").unwrap().get("status"),
         Some("redacted"),
-        "modified verdict should record a 'redacted' status in filter_results"
+        "status must be 'redacted', not 'passed', so downstream branch logic is not misled"
     );
 }
 
diff --git a/tests/integration/tests/suite/examples/guardrails.rs b/tests/integration/tests/suite/examples/guardrails.rs
index a693cf8188..f48ee4169b 100644
--- a/tests/integration/tests/suite/examples/guardrails.rs
+++ b/tests/integration/tests/suite/examples/guardrails.rs
@@ -73,10 +73,10 @@ fn nemo_guardrails_block_rejects_with_403() {
     );
 }
 
-/// `NeMo` returns `"modified"` (redact placeholder) → request is forwarded
-/// to the upstream unchanged and the upstream response is returned.
+/// `NeMo` returns `"modified"` (redact verdict) → proxy rejects with 403.
+/// The original sensitive body must never be forwarded to the upstream.
 #[test]
-fn nemo_guardrails_redact_placeholder_continues() {
+fn nemo_guardrails_redact_rejects_with_403() {
     let backend = start_backend_with_shutdown("ok");
     let nemo = nemo_mock(
         r#"{"status":"modified","content":"my ssn is [REDACTED]","rails_status":{"pii masking":{"status":"blocked"}}}"#,
@@ -96,10 +96,13 @@ fn nemo_guardrails_redact_placeholder_continues() {
     );
 
     assert_eq!(
-        status, 200,
-        "NeMo 'modified' should continue (body replacement deferred to #579)"
+        status, 403,
+        "NeMo 'modified' must reject with 403"
+    );
+    assert!(
+        body.contains("pii masking"),
+        "triggered rail name should appear in rejection body; got: {body}"
     );
-    assert_eq!(body, "ok", "upstream response should reach the client");
 }
 
 /// `NeMo` is unreachable → provider error propagates and the proxy does not