diff --git a/packages/argent/src/cli.ts b/packages/argent/src/cli.ts
index 7901037e..8411777c 100644
--- a/packages/argent/src/cli.ts
+++ b/packages/argent/src/cli.ts
@@ -26,6 +26,7 @@ import type * as Installer from "@argent/installer";
 import type * as Mcp from "@argent/mcp";
 import type * as Cli from "@argent/cli";
 import { BUNDLED_RUNTIME_PATHS } from "./bundled-paths.js";
+import { installFatalHandlers } from "./fatal-handlers.js";
 
 const PACKAGE_NAME = "@swmansion/argent";
 
@@ -44,16 +45,7 @@ function getInstalledVersion(): string | null {
 const [, , command, ...rest] = process.argv;
 const isMcpServer = command === "mcp";
 
-process.on("uncaughtException", (err) => {
-  process.stderr.write(`[argent] Uncaught exception: ${err.stack ?? err}\n`);
-  if (!isMcpServer) process.exit(1);
-});
-process.on("unhandledRejection", (reason) => {
-  process.stderr.write(
-    `[argent] Unhandled rejection: ${reason instanceof Error ? (reason.stack ?? reason.message) : reason}\n`
-  );
-  if (!isMcpServer) process.exit(1);
-});
+installFatalHandlers({ isMcpServer });
 
 function printHelp(): void {
   const version = getInstalledVersion() ?? "unknown";
diff --git a/packages/argent/src/fatal-handlers.ts b/packages/argent/src/fatal-handlers.ts
new file mode 100644
index 00000000..fd441d47
--- /dev/null
+++ b/packages/argent/src/fatal-handlers.ts
@@ -0,0 +1,53 @@
+// Process-level handlers for uncaughtException and unhandledRejection.
+//
+// In MCP-server mode we do NOT exit on every uncaught error — many are
+// transient and the editor expects the server to keep running. But the naive
+// version (`stderr.write(...); if (!isMcp) exit`) burns 100% CPU when stderr
+// itself is broken (e.g. the parent process is gone): the write emits an
+// async 'error' event on the stream, which without a listener becomes another
+// uncaughtException, runs the handler, writes to the same broken stream, ...
+//
+// The fix has three pieces:
+//   1. `'error'` listeners on stdout/stderr — broken stdio is fatal; exit
+//      before the failure round-trips into uncaughtException. This is what
+//      breaks the production loop.
+//   2. try/catch around `stderr.write` — synchronous write failures also exit
+//      cleanly instead of escaping into another uncaughtException.
+//   3. try/catch around the formatter — a throwing `.stack` getter or
+//      `toString` (the production trace pointed at defaultPrepareStackTrace)
+//      can't take down the handler.
+
+let installed = false;
+
+export function installFatalHandlers(opts: { isMcpServer: boolean }): void {
+  if (installed) return;
+  installed = true;
+
+  for (const stream of [process.stdout, process.stderr] as const) {
+    stream.on("error", () => process.exit(1));
+  }
+
+  function reportFatal(label: string, getDetail: () => string): void {
+    try {
+      let detail: string;
+      try {
+        detail = getDetail();
+      } catch {
+        detail = "<failed to format>";
+      }
+      process.stderr.write(`[argent] ${label}: ${detail}\n`);
+    } catch {
+      process.exit(1);
+    }
+    if (!opts.isMcpServer) process.exit(1);
+  }
+
+  process.on("uncaughtException", (err) => {
+    reportFatal("Uncaught exception", () => String((err as Error)?.stack ?? err));
+  });
+  process.on("unhandledRejection", (reason) => {
+    reportFatal("Unhandled rejection", () =>
+      reason instanceof Error ? (reason.stack ?? reason.message) : String(reason)
+    );
+  });
+}
diff --git a/packages/argent/test/fatal-handlers.test.ts b/packages/argent/test/fatal-handlers.test.ts
new file mode 100644
index 00000000..44290851
--- /dev/null
+++ b/packages/argent/test/fatal-handlers.test.ts
@@ -0,0 +1,161 @@
+import { spawn } from "node:child_process";
+import * as fs from "node:fs";
+import * as os from "node:os";
+import * as path from "node:path";
+import * as esbuild from "esbuild";
+import { afterAll, beforeAll, describe, expect, it } from "vitest";
+
+// Compile src/fatal-handlers.ts to a tmp .mjs once before all tests so the
+// spawned child node processes can `import` it without depending on a prior
+// `npm run build` step. Self-contained: no dist/ build dependency.
+let handlerUrl = "";
+let tmpDir = "";
+
+beforeAll(async () => {
+  tmpDir = fs.mkdtempSync(path.join(os.tmpdir(), "argent-fatal-handlers-"));
+  const srcPath = path.resolve(import.meta.dirname, "../src/fatal-handlers.ts");
+  const out = await esbuild.transform(fs.readFileSync(srcPath, "utf8"), {
+    loader: "ts",
+    format: "esm",
+    target: "node20",
+  });
+  const handlerPath = path.join(tmpDir, "fatal-handlers.mjs");
+  fs.writeFileSync(handlerPath, out.code);
+  handlerUrl = JSON.stringify(`file://${handlerPath}`);
+});
+
+afterAll(() => {
+  if (tmpDir) fs.rmSync(tmpDir, { recursive: true, force: true });
+});
+
+interface RunResult {
+  exitCode: number | null;
+  signal: NodeJS.Signals | null;
+  stdout: string;
+  stderr: string;
+  durationMs: number;
+}
+
+function runChild(scriptBody: string, timeoutMs = 3_000): Promise<RunResult> {
+  return new Promise((resolve, reject) => {
+    const start = Date.now();
+    const child = spawn(process.execPath, ["--input-type=module", "-e", scriptBody], {
+      stdio: ["ignore", "pipe", "pipe"],
+    });
+    let stdout = "";
+    let stderr = "";
+    child.stdout.on("data", (chunk) => (stdout += chunk.toString()));
+    child.stderr.on("data", (chunk) => (stderr += chunk.toString()));
+    const killer = setTimeout(() => {
+      child.kill("SIGKILL");
+      reject(
+        new Error(`child still running after ${timeoutMs}ms — fix is broken; output: ${stderr}`)
+      );
+    }, timeoutMs);
+    child.on("exit", (code, signal) => {
+      clearTimeout(killer);
+      resolve({
+        exitCode: code,
+        signal,
+        stdout,
+        stderr,
+        durationMs: Date.now() - start,
+      });
+    });
+    child.on("error", (err) => {
+      clearTimeout(killer);
+      reject(err);
+    });
+  });
+}
+
+describe("installFatalHandlers", () => {
+  it("exits cleanly when stderr is broken (the orphaned-process loop scenario)", async () => {
+    // Reproduces the production bug: an orphaned MCP process whose stderr
+    // pipe broke entered an exception loop. Each stderr.write emitted an
+    // async 'error' event, which without a listener became another
+    // uncaughtException, calling the handler again, ...
+    const script = `
+      import { installFatalHandlers } from ${handlerUrl};
+      const origWrite = process.stderr.write.bind(process.stderr);
+      let writes = 0;
+      process.stderr.write = (chunk, ...rest) => {
+        writes++;
+        if (writes > 50) {
+          // Hardstop: if we get here the fix is broken.
+          process._rawDebug("LOOP NOT FIXED writes=" + writes);
+          process.exit(99);
+        }
+        // Synthesize the broken-pipe behavior: every write emits an async error.
+        setImmediate(() => process.stderr.emit("error", new Error("synthetic EPIPE")));
+        return true;
+      };
+      installFatalHandlers({ isMcpServer: true });
+      throw new Error("initial boom");
+    `;
+    const result = await runChild(script);
+    expect(result.exitCode).toBe(1);
+    expect(result.durationMs).toBeLessThan(2_000);
+  });
+
+  it("exits with code 1 in non-mcp mode on uncaught exception", async () => {
+    const script = `
+      import { installFatalHandlers } from ${handlerUrl};
+      installFatalHandlers({ isMcpServer: false });
+      throw new Error("boom");
+    `;
+    const result = await runChild(script);
+    expect(result.exitCode).toBe(1);
+    expect(result.stderr).toContain("[argent] Uncaught exception");
+    expect(result.stderr).toContain("boom");
+  });
+
+  it("does NOT exit in mcp mode when stderr works (transient errors stay non-fatal)", async () => {
+    // Regression guard: the bug fix must not change the existing "MCP server
+    // keeps running on uncaught exceptions" semantics. After throwing once,
+    // the process should still be alive and able to do work.
+    const script = `
+      import { installFatalHandlers } from ${handlerUrl};
+      installFatalHandlers({ isMcpServer: true });
+      process.nextTick(() => { throw new Error("transient"); });
+      setTimeout(() => {
+        process.stdout.write("STILL_ALIVE");
+        process.exit(0);
+      }, 200);
+    `;
+    const result = await runChild(script);
+    expect(result.exitCode).toBe(0);
+    expect(result.stdout).toContain("STILL_ALIVE");
+    expect(result.stderr).toContain("[argent] Uncaught exception");
+    expect(result.stderr).toContain("transient");
+  });
+
+  it("formats unhandled rejections", async () => {
+    const script = `
+      import { installFatalHandlers } from ${handlerUrl};
+      installFatalHandlers({ isMcpServer: false });
+      Promise.reject(new Error("rejected-thing"));
+    `;
+    const result = await runChild(script);
+    expect(result.exitCode).toBe(1);
+    expect(result.stderr).toContain("[argent] Unhandled rejection");
+    expect(result.stderr).toContain("rejected-thing");
+  });
+
+  it("survives errors thrown from inside the stack-formatter (defaultPrepareStackTrace)", async () => {
+    // Real production trace showed time spent in defaultPrepareStackTrace,
+    // suggesting the original error's .stack getter was throwing. The fix
+    // wraps the formatter in a try/catch so a failing .stack does not start
+    // the loop.
+    const script = `
+      import { installFatalHandlers } from ${handlerUrl};
+      installFatalHandlers({ isMcpServer: false });
+      const err = new Error("boom");
+      Object.defineProperty(err, "stack", { get() { throw new Error("stack-getter-blew-up"); } });
+      throw err;
+    `;
+    const result = await runChild(script);
+    expect(result.exitCode).toBe(1);
+    expect(result.stderr).toContain("[argent] Uncaught exception");
+  });
+});