diff --git a/cli.py b/cli.py
index 05015752a..588988d8c 100644
--- a/cli.py
+++ b/cli.py
@@ -8370,6 +8370,17 @@ class HermesCLI:
 
             def run_agent():
                 nonlocal result
+                # Set callbacks inside the agent thread so thread-local storage
+                # in terminal_tool is populated for this thread.  The main thread
+                # registration (run() line ~9046) is invisible here because
+                # _callback_tls is threading.local().  Matches the pattern used
+                # by acp_adapter/server.py for ACP sessions.
+                set_sudo_password_callback(self._sudo_password_callback)
+                set_approval_callback(self._approval_callback)
+                try:
+                    set_secret_capture_callback(self._secret_capture_callback)
+                except Exception:
+                    pass
                 agent_message = _voice_prefix + message if _voice_prefix else message
                 # Prepend pending model switch note so the model knows about the switch
                 _msn = getattr(self, '_pending_model_switch_note', None)
@@ -8395,6 +8406,15 @@ class HermesCLI:
                         "failed": True,
                         "error": _summary,
                     }
+                finally:
+                    # Clear thread-local callbacks so a reused thread doesn't
+                    # hold stale references to a disposed CLI instance.
+                    try:
+                        set_sudo_password_callback(None)
+                        set_approval_callback(None)
+                        set_secret_capture_callback(None)
+                    except Exception:
+                        pass
 
             # Start agent in background thread (daemon so it cannot keep the
             # process alive when the user closes the terminal tab — SIGHUP
diff --git a/ui-tui/src/app/useInputHandlers.ts b/ui-tui/src/app/useInputHandlers.ts
index f0e5b3047..25243e992 100644
--- a/ui-tui/src/app/useInputHandlers.ts
+++ b/ui-tui/src/app/useInputHandlers.ts
@@ -172,6 +172,17 @@ export function useInputHandlers(ctx: InputHandlerContext): InputHandlerResult {
     const live = getUiState()
 
     if (isBlocked) {
+      // When approval/clarify/confirm overlays are active, their own useInput
+      // handlers must receive keystrokes (arrow keys, numbers, Enter).  Only
+      // intercept Ctrl+C here so the user can deny/dismiss — all other keys
+      // fall through to the component-level handlers.
+      if (overlay.approval || overlay.clarify || overlay.confirm) {
+        if (isCtrl(key, ch, 'c')) {
+          cancelOverlayFromCtrlC()
+        }
+        return
+      }
+
       if (overlay.pager) {
         if (key.escape || isCtrl(key, ch, 'c') || ch === 'q') {
           return patchOverlayState({ pager: null })