diff --git a/gateway/run.py b/gateway/run.py
index 5bac7da55c..f728c4a702 100644
--- a/gateway/run.py
+++ b/gateway/run.py
@@ -17,6 +17,7 @@ import asyncio
 import logging
 import os
 import re
+import shlex
 import sys
 import signal
 import threading
@@ -674,8 +675,17 @@ class GatewayRunner:
         except Exception as e:
             logger.warning("Channel directory build failed: %s", e)
         
-        # Check if we're restarting after a /update command
-        await self._send_update_notification()
+        # Check if we're restarting after a /update command. If the update is
+        # still running, keep watching so we notify once it actually finishes.
+        notified = await self._send_update_notification()
+        if not notified and any(
+            path.exists()
+            for path in (
+                _hermes_home / ".update_pending.json",
+                _hermes_home / ".update_pending.claimed.json",
+            )
+        ):
+            self._schedule_update_notification_watch()
 
         # Start background session expiry watcher for proactive memory flushing
         asyncio.create_task(self._session_expiry_watcher())
@@ -2714,9 +2724,9 @@ class GatewayRunner:
         """Handle /update command — update Hermes Agent to the latest version.
 
         Spawns ``hermes update`` in a separate systemd scope so it survives the
-        gateway restart that ``hermes update`` triggers at the end.  A marker
-        file is written so the *new* gateway process can notify the user of the
-        result on startup.
+        gateway restart that ``hermes update`` may trigger at the end. Marker
+        files are written so either the current gateway process or the next one
+        can notify the user when the update finishes.
         """
         import json
         import shutil
@@ -2733,9 +2743,9 @@ class GatewayRunner:
         if not hermes_bin:
             return "✗ `hermes` command not found on PATH."
 
-        # Write marker so the restarted gateway can notify this chat
         pending_path = _hermes_home / ".update_pending.json"
         output_path = _hermes_home / ".update_output.txt"
+        exit_code_path = _hermes_home / ".update_exit_code"
         pending = {
             "platform": event.source.platform.value,
             "chat_id": event.source.chat_id,
@@ -2743,10 +2753,14 @@ class GatewayRunner:
             "timestamp": datetime.now().isoformat(),
         }
         pending_path.write_text(json.dumps(pending))
+        exit_code_path.unlink(missing_ok=True)
 
         # Spawn `hermes update` in a separate cgroup so it survives gateway
-        # restart.  systemd-run --user --scope creates a transient scope unit.
-        update_cmd = f"{hermes_bin} update > {output_path} 2>&1"
+        # restart. systemd-run --user --scope creates a transient scope unit.
+        update_cmd = (
+            f"{shlex.quote(hermes_bin)} update > {shlex.quote(str(output_path))} 2>&1; "
+            f"status=$?; printf '%s' \"$status\" > {shlex.quote(str(exit_code_path))}"
+        )
         try:
             systemd_run = shutil.which("systemd-run")
             if systemd_run:
@@ -2768,26 +2782,91 @@ class GatewayRunner:
                 )
         except Exception as e:
             pending_path.unlink(missing_ok=True)
+            exit_code_path.unlink(missing_ok=True)
             return f"✗ Failed to start update: {e}"
 
+        self._schedule_update_notification_watch()
         return "⚕ Starting Hermes update… I'll notify you when it's done."
 
-    async def _send_update_notification(self) -> None:
-        """If the gateway is starting after a ``/update``, notify the user."""
+    def _schedule_update_notification_watch(self) -> None:
+        """Ensure a background task is watching for update completion."""
+        existing_task = getattr(self, "_update_notification_task", None)
+        if existing_task and not existing_task.done():
+            return
+
+        try:
+            self._update_notification_task = asyncio.create_task(
+                self._watch_for_update_completion()
+            )
+        except RuntimeError:
+            logger.debug("Skipping update notification watcher: no running event loop")
+
+    async def _watch_for_update_completion(
+        self,
+        poll_interval: float = 2.0,
+        timeout: float = 1800.0,
+    ) -> None:
+        """Wait for ``hermes update`` to finish, then send its notification."""
+        pending_path = _hermes_home / ".update_pending.json"
+        claimed_path = _hermes_home / ".update_pending.claimed.json"
+        exit_code_path = _hermes_home / ".update_exit_code"
+        loop = asyncio.get_running_loop()
+        deadline = loop.time() + timeout
+
+        while (pending_path.exists() or claimed_path.exists()) and loop.time() < deadline:
+            if exit_code_path.exists():
+                await self._send_update_notification()
+                return
+            await asyncio.sleep(poll_interval)
+
+        if (pending_path.exists() or claimed_path.exists()) and not exit_code_path.exists():
+            logger.warning("Update watcher timed out waiting for completion marker")
+            exit_code_path.write_text("124")
+            await self._send_update_notification()
+
+    async def _send_update_notification(self) -> bool:
+        """If an update finished, notify the user.
+
+        Returns False when the update is still running so a caller can retry
+        later. Returns True after a definitive send/skip decision.
+        """
         import json
         import re as _re
 
         pending_path = _hermes_home / ".update_pending.json"
+        claimed_path = _hermes_home / ".update_pending.claimed.json"
         output_path = _hermes_home / ".update_output.txt"
+        exit_code_path = _hermes_home / ".update_exit_code"
 
-        if not pending_path.exists():
-            return
+        if not pending_path.exists() and not claimed_path.exists():
+            return False
 
+        cleanup = True
+        active_pending_path = claimed_path
         try:
-            pending = json.loads(pending_path.read_text())
+            if pending_path.exists():
+                try:
+                    pending_path.replace(claimed_path)
+                except FileNotFoundError:
+                    if not claimed_path.exists():
+                        return True
+            elif not claimed_path.exists():
+                return True
+
+            pending = json.loads(claimed_path.read_text())
             platform_str = pending.get("platform")
             chat_id = pending.get("chat_id")
 
+            if not exit_code_path.exists():
+                logger.info("Update notification deferred: update still running")
+                cleanup = False
+                active_pending_path = pending_path
+                claimed_path.replace(pending_path)
+                return False
+
+            exit_code_raw = exit_code_path.read_text().strip() or "1"
+            exit_code = int(exit_code_raw)
+
             # Read the captured update output
             output = ""
             if output_path.exists():
@@ -2801,19 +2880,34 @@ class GatewayRunner:
                 # Strip ANSI escape codes for clean display
                 output = _re.sub(r'\x1b\[[0-9;]*m', '', output).strip()
                 if output:
-                    # Truncate if too long for a single message
                     if len(output) > 3500:
                         output = "…" + output[-3500:]
-                    msg = f"✅ Hermes update finished — gateway restarted.\n\n```\n{output}\n```"
+                    if exit_code == 0:
+                        msg = f"✅ Hermes update finished.\n\n```\n{output}\n```"
+                    else:
+                        msg = f"❌ Hermes update failed.\n\n```\n{output}\n```"
                 else:
-                    msg = "✅ Hermes update finished — gateway restarted successfully."
+                    if exit_code == 0:
+                        msg = "✅ Hermes update finished successfully."
+                    else:
+                        msg = "❌ Hermes update failed. Check the gateway logs or run `hermes update` manually for details."
                 await adapter.send(chat_id, msg)
-                logger.info("Sent post-update notification to %s:%s", platform_str, chat_id)
+                logger.info(
+                    "Sent post-update notification to %s:%s (exit=%s)",
+                    platform_str,
+                    chat_id,
+                    exit_code,
+                )
         except Exception as e:
             logger.warning("Post-update notification failed: %s", e)
         finally:
-            pending_path.unlink(missing_ok=True)
-            output_path.unlink(missing_ok=True)
+            if cleanup:
+                active_pending_path.unlink(missing_ok=True)
+                claimed_path.unlink(missing_ok=True)
+                output_path.unlink(missing_ok=True)
+                exit_code_path.unlink(missing_ok=True)
+
+        return True
 
     def _set_session_env(self, context: SessionContext) -> None:
         """Set environment variables for the current session."""
diff --git a/tests/gateway/test_update_command.py b/tests/gateway/test_update_command.py
index 063f3c5acf..a76ce7c828 100644
--- a/tests/gateway/test_update_command.py
+++ b/tests/gateway/test_update_command.py
@@ -133,6 +133,7 @@ class TestHandleUpdateCommand:
         assert data["platform"] == "telegram"
         assert data["chat_id"] == "99999"
         assert "timestamp" in data
+        assert not (hermes_home / ".update_exit_code").exists()
 
     @pytest.mark.asyncio
     async def test_spawns_systemd_run(self, tmp_path):
@@ -160,6 +161,7 @@ class TestHandleUpdateCommand:
         call_args = mock_popen.call_args[0][0]
         assert call_args[0] == "/usr/bin/systemd-run"
         assert "--scope" in call_args
+        assert ".update_exit_code" in call_args[-1]
         assert "Starting Hermes update" in result
 
     @pytest.mark.asyncio
@@ -196,6 +198,7 @@ class TestHandleUpdateCommand:
         call_args = mock_popen.call_args[0][0]
         assert call_args[0] == "bash"
         assert "nohup" in call_args[2]
+        assert ".update_exit_code" in call_args[2]
         assert "Starting Hermes update" in result
 
     @pytest.mark.asyncio
@@ -222,6 +225,7 @@ class TestHandleUpdateCommand:
         assert "Failed to start update" in result
         # Pending file should be cleaned up
         assert not (hermes_home / ".update_pending.json").exists()
+        assert not (hermes_home / ".update_exit_code").exists()
 
     @pytest.mark.asyncio
     async def test_returns_user_friendly_message(self, tmp_path):
@@ -266,6 +270,53 @@ class TestSendUpdateNotification:
             # Should not raise
             await runner._send_update_notification()
 
+    @pytest.mark.asyncio
+    async def test_defers_notification_while_update_still_running(self, tmp_path):
+        """Returns False and keeps marker files when the update has not exited yet."""
+        runner = _make_runner()
+        hermes_home = tmp_path / "hermes"
+        hermes_home.mkdir()
+
+        pending_path = hermes_home / ".update_pending.json"
+        pending_path.write_text(json.dumps({
+            "platform": "telegram", "chat_id": "67890", "user_id": "12345",
+        }))
+        (hermes_home / ".update_output.txt").write_text("still running")
+
+        mock_adapter = AsyncMock()
+        runner.adapters = {Platform.TELEGRAM: mock_adapter}
+
+        with patch("gateway.run._hermes_home", hermes_home):
+            result = await runner._send_update_notification()
+
+        assert result is False
+        mock_adapter.send.assert_not_called()
+        assert pending_path.exists()
+
+    @pytest.mark.asyncio
+    async def test_recovers_from_claimed_pending_file(self, tmp_path):
+        """A claimed pending file from a crashed notifier is still deliverable."""
+        runner = _make_runner()
+        hermes_home = tmp_path / "hermes"
+        hermes_home.mkdir()
+
+        claimed_path = hermes_home / ".update_pending.claimed.json"
+        claimed_path.write_text(json.dumps({
+            "platform": "telegram", "chat_id": "67890", "user_id": "12345",
+        }))
+        (hermes_home / ".update_output.txt").write_text("done")
+        (hermes_home / ".update_exit_code").write_text("0")
+
+        mock_adapter = AsyncMock()
+        runner.adapters = {Platform.TELEGRAM: mock_adapter}
+
+        with patch("gateway.run._hermes_home", hermes_home):
+            result = await runner._send_update_notification()
+
+        assert result is True
+        mock_adapter.send.assert_called_once()
+        assert not claimed_path.exists()
+
     @pytest.mark.asyncio
     async def test_sends_notification_with_output(self, tmp_path):
         """Sends update output to the correct platform and chat."""
@@ -284,6 +335,7 @@ class TestSendUpdateNotification:
         (hermes_home / ".update_output.txt").write_text(
             "→ Found 3 new commit(s)\n✓ Code updated!\n✓ Update complete!"
         )
+        (hermes_home / ".update_exit_code").write_text("0")
 
         # Mock the adapter
         mock_adapter = AsyncMock()
@@ -310,6 +362,7 @@ class TestSendUpdateNotification:
         (hermes_home / ".update_output.txt").write_text(
             "\x1b[32m✓ Code updated!\x1b[0m\n\x1b[1mDone\x1b[0m"
         )
+        (hermes_home / ".update_exit_code").write_text("0")
 
         mock_adapter = AsyncMock()
         runner.adapters = {Platform.TELEGRAM: mock_adapter}
@@ -331,6 +384,7 @@ class TestSendUpdateNotification:
         pending = {"platform": "telegram", "chat_id": "111", "user_id": "222"}
         (hermes_home / ".update_pending.json").write_text(json.dumps(pending))
         (hermes_home / ".update_output.txt").write_text("x" * 5000)
+        (hermes_home / ".update_exit_code").write_text("0")
 
         mock_adapter = AsyncMock()
         runner.adapters = {Platform.TELEGRAM: mock_adapter}
@@ -344,6 +398,29 @@ class TestSendUpdateNotification:
         # Total message should not be absurdly long
         assert len(sent_text) < 4500
 
+    @pytest.mark.asyncio
+    async def test_sends_failure_message_when_update_fails(self, tmp_path):
+        """Non-zero exit codes produce a failure notification with captured output."""
+        runner = _make_runner()
+        hermes_home = tmp_path / "hermes"
+        hermes_home.mkdir()
+
+        pending = {"platform": "telegram", "chat_id": "111", "user_id": "222"}
+        (hermes_home / ".update_pending.json").write_text(json.dumps(pending))
+        (hermes_home / ".update_output.txt").write_text("Traceback: boom")
+        (hermes_home / ".update_exit_code").write_text("1")
+
+        mock_adapter = AsyncMock()
+        runner.adapters = {Platform.TELEGRAM: mock_adapter}
+
+        with patch("gateway.run._hermes_home", hermes_home):
+            result = await runner._send_update_notification()
+
+        assert result is True
+        sent_text = mock_adapter.send.call_args[0][1]
+        assert "update failed" in sent_text.lower()
+        assert "Traceback: boom" in sent_text
+
     @pytest.mark.asyncio
     async def test_sends_generic_message_when_no_output(self, tmp_path):
         """Sends a success message even if the output file is missing."""
@@ -354,6 +431,7 @@ class TestSendUpdateNotification:
         pending = {"platform": "telegram", "chat_id": "111", "user_id": "222"}
         (hermes_home / ".update_pending.json").write_text(json.dumps(pending))
         # No .update_output.txt created
+        (hermes_home / ".update_exit_code").write_text("0")
 
         mock_adapter = AsyncMock()
         runner.adapters = {Platform.TELEGRAM: mock_adapter}
@@ -362,7 +440,7 @@ class TestSendUpdateNotification:
             await runner._send_update_notification()
 
         sent_text = mock_adapter.send.call_args[0][1]
-        assert "restarted successfully" in sent_text
+        assert "finished successfully" in sent_text
 
     @pytest.mark.asyncio
     async def test_cleans_up_files_after_notification(self, tmp_path):
@@ -373,10 +451,12 @@ class TestSendUpdateNotification:
 
         pending_path = hermes_home / ".update_pending.json"
         output_path = hermes_home / ".update_output.txt"
+        exit_code_path = hermes_home / ".update_exit_code"
         pending_path.write_text(json.dumps({
             "platform": "telegram", "chat_id": "111", "user_id": "222",
         }))
         output_path.write_text("✓ Done")
+        exit_code_path.write_text("0")
 
         mock_adapter = AsyncMock()
         runner.adapters = {Platform.TELEGRAM: mock_adapter}
@@ -386,6 +466,7 @@ class TestSendUpdateNotification:
 
         assert not pending_path.exists()
         assert not output_path.exists()
+        assert not exit_code_path.exists()
 
     @pytest.mark.asyncio
     async def test_cleans_up_on_error(self, tmp_path):
@@ -396,10 +477,12 @@ class TestSendUpdateNotification:
 
         pending_path = hermes_home / ".update_pending.json"
         output_path = hermes_home / ".update_output.txt"
+        exit_code_path = hermes_home / ".update_exit_code"
         pending_path.write_text(json.dumps({
             "platform": "telegram", "chat_id": "111", "user_id": "222",
         }))
         output_path.write_text("✓ Done")
+        exit_code_path.write_text("0")
 
         # Adapter send raises
         mock_adapter = AsyncMock()
@@ -412,6 +495,7 @@ class TestSendUpdateNotification:
         # Files should still be cleaned up (finally block)
         assert not pending_path.exists()
         assert not output_path.exists()
+        assert not exit_code_path.exists()
 
     @pytest.mark.asyncio
     async def test_handles_corrupt_pending_file(self, tmp_path):
@@ -440,8 +524,10 @@ class TestSendUpdateNotification:
         pending = {"platform": "discord", "chat_id": "111", "user_id": "222"}
         pending_path = hermes_home / ".update_pending.json"
         output_path = hermes_home / ".update_output.txt"
+        exit_code_path = hermes_home / ".update_exit_code"
         pending_path.write_text(json.dumps(pending))
         output_path.write_text("Done")
+        exit_code_path.write_text("0")
 
         # Only telegram adapter available, but pending says discord
         mock_adapter = AsyncMock()
@@ -454,6 +540,7 @@ class TestSendUpdateNotification:
         mock_adapter.send.assert_not_called()
         # Files should still be cleaned up
         assert not pending_path.exists()
+        assert not exit_code_path.exists()
 
 
 # ---------------------------------------------------------------------------