diff --git a/tests/test_install_no_initial_commit.py b/tests/test_install_no_initial_commit.py
new file mode 100644
index 00000000000..586f7b35cb0
--- /dev/null
+++ b/tests/test_install_no_initial_commit.py
@@ -0,0 +1,119 @@
+"""Regression for #40998: installer fails on an interrupted prior clone.
+
+A previous clone that died before its first commit leaves ``$INSTALL_DIR/.git``
+present but with no resolvable ``HEAD``. ``git rev-parse --is-inside-work-tree``
+and ``git status`` both still succeed there, so the installer treated it as a
+valid checkout and tried to *update* it -- but ``git stash``/``git checkout``
+abort with "You do not have the initial commit yet", failing the install at the
+"Cloning Hermes repository" stage.
+
+Both installers must instead treat a commit-less checkout as broken and
+re-clone fresh.
+"""
+
+from __future__ import annotations
+
+import re
+import shlex
+import shutil
+import subprocess
+from pathlib import Path
+
+import pytest
+
+REPO_ROOT = Path(__file__).resolve().parent.parent
+INSTALL_SH = REPO_ROOT / "scripts" / "install.sh"
+INSTALL_PS1 = REPO_ROOT / "scripts" / "install.ps1"
+
+pytestmark = pytest.mark.skipif(
+    shutil.which("git") is None or shutil.which("bash") is None,
+    reason="needs git and bash",
+)
+
+
+def _git(cwd: Path, *args: str) -> None:
+    subprocess.run(
+        ["git", "-c", "user.email=t@t", "-c", "user.name=t", *args],
+        cwd=cwd,
+        check=True,
+        capture_output=True,
+    )
+
+
+def _extract_no_commit_guard() -> str:
+    """Pull the clone_repo() guard that drops a commit-less checkout."""
+    text = INSTALL_SH.read_text()
+    m = re.search(
+        r'if \[ -d "\$INSTALL_DIR/\.git" \] && ! git -C "\$INSTALL_DIR" '
+        r"rev-parse --verify HEAD.*?\n    fi",
+        text,
+        re.DOTALL,
+    )
+    assert m is not None, "no-commit guard not found in install.sh clone_repo()"
+    return m.group(0)
+
+
+def _run_guard(install_dir: Path) -> None:
+    block = _extract_no_commit_guard()
+    script = (
+        "log_warn() { echo \"WARN: $*\"; }\n"
+        f"INSTALL_DIR={shlex.quote(str(install_dir))}\n"
+        f"{block}\n"
+    )
+    res = subprocess.run(["bash", "-c", script], capture_output=True, text=True)
+    assert res.returncode == 0, res.stderr
+
+
+def test_install_sh_guard_removes_commitless_checkout(tmp_path: Path) -> None:
+    install_dir = tmp_path / "hermes-agent"
+    install_dir.mkdir()
+    _git(install_dir, "init")
+    (install_dir / "leftover.txt").write_text("partial download")  # untracked
+
+    # Sanity: this is exactly the state that breaks `git stash`.
+    head = subprocess.run(
+        ["git", "-C", str(install_dir), "rev-parse", "--verify", "HEAD"],
+        capture_output=True,
+    )
+    assert head.returncode != 0
+
+    _run_guard(install_dir)
+    assert not install_dir.exists(), "commit-less checkout should be removed"
+
+
+def test_install_sh_guard_keeps_repo_with_commits(tmp_path: Path) -> None:
+    install_dir = tmp_path / "hermes-agent"
+    install_dir.mkdir()
+    _git(install_dir, "init")
+    (install_dir / "f.txt").write_text("real content")
+    _git(install_dir, "add", "f.txt")
+    _git(install_dir, "commit", "-m", "init")
+
+    _run_guard(install_dir)
+    assert install_dir.exists()
+    assert (install_dir / "f.txt").exists(), "a real checkout must be left intact"
+
+
+def test_install_sh_guard_ignores_non_repo_dir(tmp_path: Path) -> None:
+    install_dir = tmp_path / "hermes-agent"
+    install_dir.mkdir()
+    (install_dir / "f.txt").write_text("not a repo")
+
+    _run_guard(install_dir)
+    # No .git → not our concern; the existing "not a git repository" branch
+    # still handles it. The guard must leave it untouched.
+    assert install_dir.exists()
+    assert (install_dir / "f.txt").exists()
+
+
+def test_install_ps1_validity_requires_initial_commit() -> None:
+    """The PowerShell repo-validity gate must also require a resolvable HEAD."""
+    text = INSTALL_PS1.read_text()
+    assert "rev-parse --verify HEAD" in text, (
+        "install.ps1 must probe for an initial commit (#40998)"
+    )
+    # Contract: $repoValid is only set when the HEAD probe succeeded too.
+    assert re.search(
+        r"if \(\$revParseOk -and \$statusOk -and \$hasCommit\) \{",
+        text,
+    ), "repo validity must be gated on $hasCommit, not just rev-parse + status"