diff --git a/lib/crates/fabro-server/src/server.rs b/lib/crates/fabro-server/src/server.rs
index 95d83ae8f..ad640136a 100644
--- a/lib/crates/fabro-server/src/server.rs
+++ b/lib/crates/fabro-server/src/server.rs
@@ -509,9 +509,20 @@ pub fn create_app_state() -> Arc<AppState> {
 #[doc(hidden)]
 pub fn create_app_state_with_registry_factory(
     registry_factory_override: impl Fn(Arc<dyn Interviewer>) -> HandlerRegistry + Send + Sync + 'static,
+) -> Arc<AppState> {
+    create_app_state_with_settings_and_registry_factory(
+        Settings::default(),
+        registry_factory_override,
+    )
+}
+
+#[doc(hidden)]
+pub fn create_app_state_with_settings_and_registry_factory(
+    settings: Settings,
+    registry_factory_override: impl Fn(Arc<dyn Interviewer>) -> HandlerRegistry + Send + Sync + 'static,
 ) -> Arc<AppState> {
     build_app_state(
-        Arc::new(RwLock::new(Settings::default())),
+        Arc::new(RwLock::new(settings)),
         Some(Box::new(registry_factory_override)),
         5,
         test_store(),
diff --git a/lib/crates/fabro-server/tests/it/helpers.rs b/lib/crates/fabro-server/tests/it/helpers.rs
index 282c73e98..c04393d94 100644
--- a/lib/crates/fabro-server/tests/it/helpers.rs
+++ b/lib/crates/fabro-server/tests/it/helpers.rs
@@ -8,6 +8,7 @@ use fabro_server::server::{
     AppState, build_router, create_app_state, create_app_state_with_options, spawn_scheduler,
 };
 use fabro_types::Settings;
+use fabro_types::settings::{LocalSandboxSettings, SandboxSettings, WorktreeMode};
 use tower::ServiceExt;
 
 pub(crate) const MINIMAL_DOT: &str = r#"digraph Test {
@@ -24,10 +25,22 @@ pub(crate) fn test_app_state() -> Arc<AppState> {
     create_app_state()
 }
 
+pub(crate) fn test_settings() -> Settings {
+    Settings {
+        sandbox: Some(SandboxSettings {
+            local: Some(LocalSandboxSettings {
+                worktree_mode: WorktreeMode::Never,
+            }),
+            ..Default::default()
+        }),
+        ..Default::default()
+    }
+}
+
 pub(crate) fn dry_run_settings() -> Settings {
     Settings {
         dry_run: Some(true),
-        ..Default::default()
+        ..test_settings()
     }
 }
 
diff --git a/lib/crates/fabro-server/tests/it/scenario/lifecycle.rs b/lib/crates/fabro-server/tests/it/scenario/lifecycle.rs
index b55bcdff7..6e5fb84d7 100644
--- a/lib/crates/fabro-server/tests/it/scenario/lifecycle.rs
+++ b/lib/crates/fabro-server/tests/it/scenario/lifecycle.rs
@@ -3,7 +3,7 @@ use std::sync::Arc;
 use axum::body::Body;
 use axum::http::{Request, StatusCode};
 use fabro_interview::Interviewer;
-use fabro_server::server::{build_router, create_app_state_with_registry_factory};
+use fabro_server::server::{build_router, create_app_state_with_settings_and_registry_factory};
 use fabro_workflow::handler::HandlerRegistry;
 use fabro_workflow::handler::agent::AgentHandler;
 use fabro_workflow::handler::exit::ExitHandler;
@@ -12,7 +12,7 @@ use fabro_workflow::handler::start::StartHandler;
 use tower::ServiceExt;
 
 use crate::helpers::{
-    POLL_ATTEMPTS, POLL_INTERVAL, api, body_json, run_json, wait_for_run_status,
+    POLL_ATTEMPTS, POLL_INTERVAL, api, body_json, run_json, test_settings, wait_for_run_status,
     wait_for_run_status_not_in,
 };
 
@@ -65,7 +65,7 @@ const GATE_DOT: &str = r#"digraph GateTest {
 
 #[tokio::test(flavor = "multi_thread", worker_threads = 2)]
 async fn full_http_lifecycle_approve_and_complete() {
-    let state = create_app_state_with_registry_factory(gate_registry);
+    let state = create_app_state_with_settings_and_registry_factory(test_settings(), gate_registry);
     fabro_server::server::spawn_scheduler(Arc::clone(&state));
     let app = build_router(
         Arc::clone(&state),
@@ -133,7 +133,7 @@ async fn full_http_lifecycle_approve_and_complete() {
 
 #[tokio::test(flavor = "multi_thread", worker_threads = 2)]
 async fn full_http_lifecycle_cancel() {
-    let state = create_app_state_with_registry_factory(gate_registry);
+    let state = create_app_state_with_settings_and_registry_factory(test_settings(), gate_registry);
     fabro_server::server::spawn_scheduler(Arc::clone(&state));
     let app = build_router(
         Arc::clone(&state),