diff --git a/apps/web/src/components/files/FileBrowserPanel.tsx b/apps/web/src/components/files/FileBrowserPanel.tsx
index 49894db3c8cf..25ac3cfbb27e 100644
--- a/apps/web/src/components/files/FileBrowserPanel.tsx
+++ b/apps/web/src/components/files/FileBrowserPanel.tsx
@@ -30,7 +30,7 @@ interface FileBrowserPanelProps {
   environmentId: EnvironmentId;
   cwd: string;
   projectName: string;
-  /** File currently open in the preview pane; revealed and selected in the tree. */
+  /** Entry currently open in the surface; revealed and selected in the tree. A directory is expanded. */
   selectedPath: string | null;
   /** Bumped when the same path should be revealed again (e.g. re-opened from search). */
   selectedPathRevealId: number;
@@ -299,8 +299,11 @@ export default function FileBrowserPanel({
     ) {
       return;
     }
-    if (entryKinds.get(selectedPath) !== "file") return;
-    const selectedItem = model.getItem(selectedPath);
+    const selectedKind = entryKinds.get(selectedPath);
+    if (selectedKind === undefined) return;
+    // Directory rows are registered with a trailing slash (see treePath).
+    const selectedTreePath = selectedKind === "directory" ? `${selectedPath}/` : selectedPath;
+    const selectedItem = model.getItem(selectedTreePath);
     if (!selectedItem) return;
 
     // A selection that originated inside the tree (clicking a row, possibly
@@ -334,8 +337,12 @@ export default function FileBrowserPanel({
       if (item && "expand" in item) item.expand();
     }
 
+    if ("expand" in selectedItem) selectedItem.expand();
     selectedItem.select();
-    model.scrollToPath(selectedPath, { focus: true, offset: "center" });
+    model.scrollToPath(selectedTreePath, {
+      focus: true,
+      offset: "center",
+    });
     queueMicrotask(() => {
       syncingSelectionRef.current = false;
     });
diff --git a/apps/web/src/components/files/FilePreviewPanel.tsx b/apps/web/src/components/files/FilePreviewPanel.tsx
index b739d120da63..15153badea99 100644
--- a/apps/web/src/components/files/FilePreviewPanel.tsx
+++ b/apps/web/src/components/files/FilePreviewPanel.tsx
@@ -989,15 +989,22 @@ export default function FilePreviewPanel({
   // A file outside the workspace (an absolute path) is shown, never edited.
   const isHostFile =
     attachment !== undefined || (relativePath !== null && isAbsolutePath(relativePath));
-  const file = useProjectFileQuery(
-    environmentId,
-    cwd,
-    relativePath,
-    attachment === undefined && !isMedia && !isPdf,
-  );
+  // Media and PDFs render from their absolute path, so their contents are never
+  // shown. The read still runs: a folder named `assets.png` is only knowable as a
+  // folder from the read failure, and the server stats before reading, so a folder
+  // costs an open and a stat and returns no body.
+  const file = useProjectFileQuery(environmentId, cwd, relativePath, attachment === undefined);
+  // A chat link cannot tell a folder from a file, so a folder arrives here as
+  // a file surface and the read fails. Keep the breadcrumbs, drop the preview
+  // pane, and let the tree fill the surface with the folder revealed. Mutation
+  // refresh stays on so the surface notices if the path becomes a file. A host
+  // path cannot be revealed in the workspace tree, so it keeps the read error.
+  const isDirectory = file.isNotFile && !isHostFile;
+  // Everything preview-related keys off previewPath; a folder has no preview.
+  const previewPath = isDirectory ? null : relativePath;
   const [explorerOpen, setExplorerOpen] = useState(initialExplorerOpen);
   const showExplorer = shouldShowFileExplorer({
-    relativePath,
+    relativePath: previewPath,
     explorerOpen,
     attachmentOpen: attachment !== undefined,
   });
@@ -1020,7 +1027,7 @@ export default function FilePreviewPanel({
     null,
   );
   const breadcrumbRef = useRef<HTMLDivElement>(null);
-  const isMarkdown = relativePath ? isMarkdownPreviewFile(relativePath) : false;
+  const isMarkdown = previewPath ? isMarkdownPreviewFile(previewPath) : false;
   // A reveal still wins over the preference: the line only exists in the source.
   const revealHandled =
     revealLine === null ||
@@ -1033,11 +1040,11 @@ export default function FilePreviewPanel({
     ? setRenderMarkdownPreferred
     : setRenderBrowserFilePreferred;
   const canOpenInBrowser =
-    relativePath !== null &&
+    previewPath !== null &&
     attachment === undefined &&
     !isVideo &&
     isPreviewSupportedInRuntime() &&
-    isBrowserPreviewFile(relativePath);
+    isBrowserPreviewFile(previewPath);
   const absolutePath =
     relativePath && attachment === undefined ? resolvePathLinkTarget(relativePath, cwd) : null;
   const onFilePostRender = useFileLineReveal(relativePath, revealLine, revealRequestId);
@@ -1045,8 +1052,10 @@ export default function FilePreviewPanel({
     enabled:
       attachment === undefined &&
       relativePath !== null &&
-      !isMedia &&
-      !isPdf &&
+      // Media and PDFs never show their contents, so re-reading them on every
+      // workspace mutation is waste. A folder named like one still re-reads, so
+      // it notices when the path becomes a file.
+      (isDirectory || (!isMedia && !isPdf)) &&
       !selectedFilePending,
     mutationId: workspaceMutationId,
     refresh: file.refresh,
@@ -1190,7 +1199,7 @@ export default function FilePreviewPanel({
               <TooltipPopup>Open file in preview browser</TooltipPopup>
             </Tooltip>
           ) : null}
-          {!isHostFile ? (
+          {!isHostFile && previewPath !== null ? (
             <Tooltip>
               <TooltipTrigger
                 render={
@@ -1213,17 +1222,14 @@ export default function FilePreviewPanel({
           ) : null}
         </div>
       ) : null}
-      {relativePath && !isMedia && !renderBrowserFile && file.data?.truncated ? (
+      {previewPath && !isMedia && !renderBrowserFile && file.data?.truncated ? (
         <div className="shrink-0 border-b border-warning/20 bg-warning-surface px-3 py-1.5 text-[11px] text-warning-foreground">
           Preview limited to the first 1 MB of a {file.data.byteLength.toLocaleString()} byte file.
         </div>
       ) : null}
       <div className="flex min-h-0 flex-1 overflow-hidden">
         <div
-          className={cn(
-            "min-w-0 flex-1 flex-col overflow-hidden",
-            relativePath ? "flex" : "hidden",
-          )}
+          className={cn("min-w-0 flex-1 flex-col overflow-hidden", previewPath ? "flex" : "hidden")}
         >
           {relativePath && attachment ? (
             <AttachmentBrowserPreview environmentId={environmentId} attachment={attachment} />
@@ -1332,7 +1338,7 @@ export default function FilePreviewPanel({
           <aside
             className={cn(
               "flex min-h-0 shrink-0 bg-background",
-              relativePath
+              previewPath
                 ? "w-[min(22rem,46%)] min-w-64 border-l border-border/60"
                 : "min-w-0 flex-1",
             )}
@@ -1346,7 +1352,7 @@ export default function FilePreviewPanel({
               selectedPathRevealId={revealRequestId}
               onOpenFile={onOpenFile}
               workspaceMutationId={workspaceMutationId}
-              {...(relativePath && !isMedia && !isPdf
+              {...(previewPath && !isMedia && !isPdf
                 ? { onRefreshSelectedFile: file.refresh }
                 : {})}
             />
diff --git a/apps/web/src/components/files/projectFilesQueryState.test.tsx b/apps/web/src/components/files/projectFilesQueryState.test.tsx
index 8edf982a030a..3de418d065e8 100644
--- a/apps/web/src/components/files/projectFilesQueryState.test.tsx
+++ b/apps/web/src/components/files/projectFilesQueryState.test.tsx
@@ -1,6 +1,7 @@
 import {
   EnvironmentId,
   type ProjectListEntriesResult,
+  ProjectReadFileError,
   type ProjectReadFileResult,
 } from "@t3tools/contracts";
 import * as Effect from "effect/Effect";
@@ -250,4 +251,33 @@ describe("project query refresh", () => {
       atomHooks.registry = null;
     }
   });
+
+  it("reports a directory read as not a file", async () => {
+    const readAtom = Atom.make(
+      Effect.fail(
+        new ProjectReadFileError({
+          cwd: "/repo",
+          relativePath: ".agents/skills",
+          failure: "path_not_file",
+        }),
+      ),
+    );
+    const registry = AtomRegistry.make();
+    const unmount = registry.mount(readAtom);
+    projectMocks.readFile.mockReturnValue(readAtom);
+    projectMocks.optimisticFile.mockReturnValue(Atom.make(null));
+    atomHooks.registry = registry;
+
+    try {
+      await flushEffects();
+      reactHooks.beginRender();
+      const query = useProjectFileQuery(environmentId, "/repo", ".agents/skills");
+      expect(query.isNotFile).toBe(true);
+      expect(query.data).toBeNull();
+    } finally {
+      unmount();
+      registry.dispose();
+      atomHooks.registry = null;
+    }
+  });
 });
diff --git a/apps/web/src/components/files/projectFilesQueryState.ts b/apps/web/src/components/files/projectFilesQueryState.ts
index a12772920956..5b76c9c399e8 100644
--- a/apps/web/src/components/files/projectFilesQueryState.ts
+++ b/apps/web/src/components/files/projectFilesQueryState.ts
@@ -1,8 +1,9 @@
 import { useAtomRefresh, useAtomValue } from "@effect/atom-react";
-import type {
-  EnvironmentId,
-  ProjectListEntriesResult,
-  ProjectReadFileResult,
+import {
+  type EnvironmentId,
+  type ProjectListEntriesResult,
+  ProjectReadFileError,
+  type ProjectReadFileResult,
 } from "@t3tools/contracts";
 import {
   isWorkspaceImagePreviewPath,
@@ -10,6 +11,7 @@ import {
 } from "@t3tools/shared/filePreview";
 import * as Cause from "effect/Cause";
 import * as Option from "effect/Option";
+import * as Schema from "effect/Schema";
 import { AsyncResult, Atom } from "effect/unstable/reactivity";
 import { useCallback } from "react";
 
@@ -33,6 +35,11 @@ interface ProjectQueryState<A> {
   readonly refresh: () => void;
 }
 
+interface ProjectFileQueryState extends ProjectQueryState<ProjectReadFileResult> {
+  /** The path exists but is not a regular file, typically a directory. */
+  readonly isNotFile: boolean;
+}
+
 function getProjectEntriesQueryAtom(environmentId: EnvironmentId, cwd: string) {
   return projectEnvironment.listEntries({ environmentId, input: { cwd } });
 }
@@ -119,12 +126,17 @@ export function clearProjectFileQueryData(
   appAtomRegistry.set(optimisticFileAtom(environmentId, cwd, relativePath), null);
 }
 
-function errorMessage<A>(result: AsyncResult.AsyncResult<A, unknown>): string | null {
-  if (result._tag !== "Failure") return null;
-  const cause = Cause.squash(result.cause);
+function failureCause<A>(result: AsyncResult.AsyncResult<A, unknown>): unknown {
+  return result._tag === "Failure" ? Cause.squash(result.cause) : null;
+}
+
+function errorMessage(cause: unknown): string | null {
+  if (cause === null) return null;
   return cause instanceof Error ? cause.message : "Workspace query failed.";
 }
 
+const isProjectReadFileError = Schema.is(ProjectReadFileError);
+
 export function useProjectEntriesQuery(
   environmentId: EnvironmentId,
   cwd: string,
@@ -135,7 +147,7 @@ export function useProjectEntriesQuery(
   const refresh = useCallback(() => refreshAtom(), [refreshAtom]);
   return {
     data: Option.getOrNull(AsyncResult.value(result)),
-    error: errorMessage(result),
+    error: errorMessage(failureCause(result)),
     isPending: result.waiting,
     refresh,
   };
@@ -181,7 +193,7 @@ export function useProjectFileQuery(
   cwd: string,
   relativePath: string | null,
   enabled = true,
-): ProjectQueryState<ProjectReadFileResult> {
+): ProjectFileQueryState {
   const isMedia =
     relativePath !== null &&
     (isWorkspaceImagePreviewPath(relativePath) || isWorkspaceVideoPreviewPath(relativePath));
@@ -197,10 +209,12 @@ export function useProjectFileQuery(
     optimisticFileAtom(environmentId, cwd, relativePath ?? EMPTY_PROJECT_FILE_PATH),
   );
   const optimisticFile = relativePath === null ? null : optimisticResult;
+  const cause = failureCause(result);
 
   return {
     data: optimisticFile?.data ?? data,
-    error: errorMessage(result),
+    error: errorMessage(cause),
+    isNotFile: isProjectReadFileError(cause) && cause.failure === "path_not_file",
     isPending: result.waiting,
     refresh,
   };
diff --git a/apps/web/src/rightPanelStore.ts b/apps/web/src/rightPanelStore.ts
index 1719ae77725c..3777a06afea2 100644
--- a/apps/web/src/rightPanelStore.ts
+++ b/apps/web/src/rightPanelStore.ts
@@ -17,6 +17,7 @@ import {
 import { create } from "zustand";
 import { createJSONStorage, persist } from "zustand/middleware";
 
+import { normalizeProjectPathForDispatch } from "./lib/projectPaths";
 import { resolveStorage } from "./lib/storage";
 
 const RIGHT_PANEL_KINDS = [
@@ -487,9 +488,11 @@ export const useRightPanelStore = create<RightPanelStoreState>()(
               : next;
           }),
         ),
-      openFile: (ref, relativePath, line) =>
+      openFile: (ref, requestedPath, line) =>
         set((state) =>
           userAction(state, scopedThreadKey(ref), (current) => {
+            // A folder link may end in a slash; the tree keys folders without it.
+            const relativePath = normalizeProjectPathForDispatch(requestedPath);
             const withoutStandaloneExplorer = current.surfaces.filter(
               (surface) => surface.kind !== "files",
             );