diff --git a/crates/arc-workflows/src/hook/config.rs b/crates/arc-workflows/src/hook/config.rs
index aab13baca..ce0887422 100644
--- a/crates/arc-workflows/src/hook/config.rs
+++ b/crates/arc-workflows/src/hook/config.rs
@@ -28,6 +28,15 @@ pub enum HookType {
         #[serde(default)]
         tls: TlsMode,
     },
+    Prompt {
+        prompt: String,
+        model: Option<String>,
+    },
+    Agent {
+        prompt: String,
+        model: Option<String>,
+        max_tool_rounds: Option<u32>,
+    },
 }
 
 /// A single hook definition.
@@ -71,9 +80,18 @@ impl HookDefinition {
     }
 
     /// Timeout duration for this hook.
+    ///
+    /// Defaults: 30s for prompt hooks, 60s for all others.
     #[must_use]
     pub fn timeout(&self) -> std::time::Duration {
-        std::time::Duration::from_millis(self.timeout_ms.unwrap_or(60_000))
+        if let Some(ms) = self.timeout_ms {
+            return std::time::Duration::from_millis(ms);
+        }
+        let default_ms = match self.resolved_hook_type() {
+            Some(HookType::Prompt { .. }) => 30_000,
+            _ => 60_000,
+        };
+        std::time::Duration::from_millis(default_ms)
     }
 
     /// Whether this hook runs in the sandbox.
@@ -95,6 +113,10 @@ impl HookDefinition {
                 format!("{event_str}:{short}")
             }
             Some(HookType::Http { ref url, .. }) => format!("{event_str}:{url}"),
+            Some(HookType::Prompt { ref prompt, .. }) | Some(HookType::Agent { ref prompt, .. }) => {
+                let short = &prompt[..arc_agent::floor_char_boundary(prompt, 20)];
+                format!("{event_str}:{short}")
+            }
             None => event_str,
         }
     }
@@ -473,6 +495,100 @@ tls = "off"
         }
     }
 
+    #[test]
+    fn parse_prompt_hook() {
+        let toml = r#"
+[[hooks]]
+event = "stage_start"
+type = "prompt"
+prompt = "Should this stage proceed?"
+model = "haiku"
+"#;
+        let config: HookConfig = toml::from_str(toml).unwrap();
+        let hook = &config.hooks[0];
+        assert!(matches!(
+            hook.resolved_hook_type(),
+            Some(HookType::Prompt { prompt, model })
+                if prompt == "Should this stage proceed?" && model == Some("haiku".into())
+        ));
+    }
+
+    #[test]
+    fn parse_agent_hook() {
+        let toml = r#"
+[[hooks]]
+event = "run_complete"
+type = "agent"
+prompt = "Verify tests pass."
+model = "sonnet"
+max_tool_rounds = 10
+"#;
+        let config: HookConfig = toml::from_str(toml).unwrap();
+        let hook = &config.hooks[0];
+        assert!(matches!(
+            hook.resolved_hook_type(),
+            Some(HookType::Agent { prompt, model, max_tool_rounds })
+                if prompt == "Verify tests pass."
+                && model == Some("sonnet".into())
+                && max_tool_rounds == Some(10)
+        ));
+    }
+
+    #[test]
+    fn prompt_hook_default_timeout_30s() {
+        let def = HookDefinition {
+            name: None,
+            event: HookEvent::RunStart,
+            command: None,
+            hook_type: Some(HookType::Prompt {
+                prompt: "check".into(),
+                model: None,
+            }),
+            matcher: None,
+            blocking: None,
+            timeout_ms: None,
+            sandbox: None,
+        };
+        assert_eq!(def.timeout(), std::time::Duration::from_secs(30));
+    }
+
+    #[test]
+    fn agent_hook_default_timeout_60s() {
+        let def = HookDefinition {
+            name: None,
+            event: HookEvent::RunStart,
+            command: None,
+            hook_type: Some(HookType::Agent {
+                prompt: "check".into(),
+                model: None,
+                max_tool_rounds: None,
+            }),
+            matcher: None,
+            blocking: None,
+            timeout_ms: None,
+            sandbox: None,
+        };
+        assert_eq!(def.timeout(), std::time::Duration::from_secs(60));
+    }
+
+    #[test]
+    fn effective_name_generated_from_prompt_hook() {
+        let def = HookDefinition {
+            name: None,
+            event: HookEvent::StageStart,
+            command: None,
+            hook_type: Some(HookType::Prompt {
+                prompt: "Should this stage proceed?".into(),
+                model: None,
+            }),
+            matcher: None,
+            blocking: None,
+            timeout_ms: None,
+            sandbox: None,
+        };
+        assert!(def.effective_name().starts_with("stage_start:"));
+    }
+
     #[test]
     fn parse_multiple_hooks() {
         let toml = r#"
diff --git a/crates/arc-workflows/src/hook/executor.rs b/crates/arc-workflows/src/hook/executor.rs
index d61acc0df..f36412e15 100644
--- a/crates/arc-workflows/src/hook/executor.rs
+++ b/crates/arc-workflows/src/hook/executor.rs
@@ -7,7 +7,7 @@ use async_trait::async_trait;
 use arc_agent::Sandbox;
 
 use super::config::{HookDefinition, HookType, TlsMode};
-use super::types::{HookContext, HookDecision, HookResult};
+use super::types::{HookContext, HookDecision, HookResult, PromptHookResponse};
 
 /// Trait for executing hooks via different transports.
 #[async_trait]
@@ -165,6 +165,203 @@ impl HookExecutorImpl {
         }
     }
 
+    /// Parse a prompt/agent hook LLM response into a `HookDecision`.
+    ///
+    /// Fail-open: invalid JSON or missing fields → `Proceed`.
+    pub fn parse_prompt_response(response_text: &str) -> HookDecision {
+        match serde_json::from_str::<PromptHookResponse>(response_text.trim()) {
+            Ok(resp) if resp.ok => HookDecision::Proceed,
+            Ok(resp) => HookDecision::Block {
+                reason: resp.reason,
+            },
+            Err(e) => {
+                tracing::warn!(error = %e, "prompt hook response parse failed, proceeding");
+                HookDecision::Proceed
+            }
+        }
+    }
+
+    /// Execute a prompt hook: single-turn LLM call returning ok/block.
+    async fn execute_prompt(
+        prompt: &str,
+        model: &Option<String>,
+        context: &HookContext,
+        timeout: std::time::Duration,
+    ) -> HookDecision {
+        let result = tokio::time::timeout(timeout, async {
+            let model_id = model.as_deref().unwrap_or("haiku");
+            let model_info = arc_llm::catalog::get_model_info(model_id);
+            let resolved_model = model_info.as_ref().map_or(model_id, |m| m.id.as_str());
+
+            let context_json = serde_json::to_string(context).unwrap_or_default();
+            let system = "You are a hook evaluator for a workflow engine. Given context about a workflow event, evaluate the condition and respond with JSON: {\"ok\": true} or {\"ok\": false, \"reason\": \"...\"}. Respond ONLY with valid JSON.";
+            let user_msg = format!("Hook prompt: {prompt}\n\nEvent context:\n{context_json}");
+
+            let params = arc_llm::generate::GenerateParams::new(resolved_model)
+                .system(system)
+                .prompt(user_msg);
+
+            match arc_llm::generate::generate(params).await {
+                Ok(result) => Self::parse_prompt_response(&result.response.text()),
+                Err(e) => {
+                    tracing::warn!(error = %e, "prompt hook LLM call failed, proceeding");
+                    HookDecision::Proceed
+                }
+            }
+        })
+        .await;
+
+        match result {
+            Ok(decision) => decision,
+            Err(_) => {
+                tracing::warn!("prompt hook timed out, proceeding");
+                HookDecision::Proceed
+            }
+        }
+    }
+
+    /// Execute an agent hook: multi-turn LLM call with sandbox tool access.
+    ///
+    /// Uses a manual tool loop with `Client::complete()` to avoid closure
+    /// lifetime issues with the sandbox reference.
+    async fn execute_agent(
+        prompt: &str,
+        model: &Option<String>,
+        max_tool_rounds: Option<u32>,
+        context: &HookContext,
+        sandbox: &dyn Sandbox,
+        timeout: std::time::Duration,
+    ) -> HookDecision {
+        let result = tokio::time::timeout(timeout, async {
+            let model_id = model.as_deref().unwrap_or("haiku");
+            let model_info = arc_llm::catalog::get_model_info(model_id);
+            let resolved_model = model_info.as_ref().map_or(model_id, |m| m.id.as_str());
+
+            let client = match arc_llm::client::Client::from_env().await {
+                Ok(c) => c,
+                Err(e) => {
+                    tracing::warn!(error = %e, "agent hook client creation failed, proceeding");
+                    return HookDecision::Proceed;
+                }
+            };
+
+            let context_json = serde_json::to_string(context).unwrap_or_default();
+            let system = "You are a hook evaluator for a workflow engine. Given context about a workflow event, evaluate the condition and respond with JSON: {\"ok\": true} or {\"ok\": false, \"reason\": \"...\"}. Respond ONLY with valid JSON.";
+            let user_msg = format!("Hook prompt: {prompt}\n\nEvent context:\n{context_json}");
+
+            let tool_defs = vec![
+                arc_llm::types::ToolDefinition {
+                    name: "exec_command".into(),
+                    description: "Execute a shell command in the sandbox".into(),
+                    parameters: serde_json::json!({
+                        "type": "object",
+                        "properties": {
+                            "command": { "type": "string", "description": "Shell command to execute" }
+                        },
+                        "required": ["command"]
+                    }),
+                },
+                arc_llm::types::ToolDefinition {
+                    name: "read_file".into(),
+                    description: "Read a file from the sandbox".into(),
+                    parameters: serde_json::json!({
+                        "type": "object",
+                        "properties": {
+                            "path": { "type": "string", "description": "Path to the file to read" }
+                        },
+                        "required": ["path"]
+                    }),
+                },
+            ];
+
+            let mut messages = vec![
+                arc_llm::types::Message::system(system),
+                arc_llm::types::Message::user(user_msg),
+            ];
+
+            let rounds = max_tool_rounds.unwrap_or(50);
+
+            for _ in 0..rounds {
+                let request = arc_llm::types::Request {
+                    model: resolved_model.to_string(),
+                    messages: messages.clone(),
+                    provider: None,
+                    tools: Some(tool_defs.clone()),
+                    tool_choice: None,
+                    response_format: None,
+                    temperature: None,
+                    top_p: None,
+                    max_tokens: None,
+                    stop_sequences: None,
+                    reasoning_effort: None,
+                    metadata: None,
+                    provider_options: None,
+                };
+
+                let response = match client.complete(&request).await {
+                    Ok(r) => r,
+                    Err(e) => {
+                        tracing::warn!(error = %e, "agent hook LLM call failed, proceeding");
+                        return HookDecision::Proceed;
+                    }
+                };
+
+                let tool_calls = response.tool_calls();
+                if tool_calls.is_empty() {
+                    return Self::parse_prompt_response(&response.text());
+                }
+
+                // Append assistant message with tool calls
+                messages.push(response.message.clone());
+
+                // Execute each tool call against the sandbox
+                for tc in &tool_calls {
+                    let args = &tc.arguments;
+
+                    let result_json = match tc.name.as_str() {
+                        "exec_command" => {
+                            let command = args.get("command").and_then(|v| v.as_str()).unwrap_or("");
+                            match sandbox.exec_command(command, 30_000, None, None, None).await {
+                                Ok(r) => serde_json::json!({
+                                    "exit_code": r.exit_code,
+                                    "stdout": r.stdout,
+                                    "stderr": r.stderr,
+                                }),
+                                Err(e) => serde_json::json!({ "error": e.to_string() }),
+                            }
+                        }
+                        "read_file" => {
+                            let path = args.get("path").and_then(|v| v.as_str()).unwrap_or("");
+                            match sandbox.read_file(path, None, None).await {
+                                Ok(content) => serde_json::json!({ "content": content }),
+                                Err(e) => serde_json::json!({ "error": e.to_string() }),
+                            }
+                        }
+                        other => serde_json::json!({ "error": format!("unknown tool: {other}") }),
+                    };
+
+                    messages.push(arc_llm::types::Message::tool_result(
+                        tc.id.clone(),
+                        result_json,
+                        false,
+                    ));
+                }
+            }
+
+            tracing::warn!("agent hook exhausted max tool rounds, proceeding");
+            HookDecision::Proceed
+        })
+        .await;
+
+        match result {
+            Ok(decision) => decision,
+            Err(_) => {
+                tracing::warn!("agent hook timed out, proceeding");
+                HookDecision::Proceed
+            }
+        }
+    }
+
     /// Execute an HTTP hook: POST context JSON and parse the response.
     /// Fail-open: non-2xx and connection errors return `Proceed`.
     async fn execute_http(
@@ -268,6 +465,27 @@ impl HookExecutor for HookExecutorImpl {
                 Self::execute_http(url, headers, allowed_env_vars, tls, context, definition.timeout())
                     .await
             }
+            Some(HookType::Prompt {
+                ref prompt,
+                ref model,
+            }) => {
+                Self::execute_prompt(prompt, model, context, definition.timeout()).await
+            }
+            Some(HookType::Agent {
+                ref prompt,
+                ref model,
+                ref max_tool_rounds,
+            }) => {
+                Self::execute_agent(
+                    prompt,
+                    model,
+                    *max_tool_rounds,
+                    context,
+                    sandbox,
+                    definition.timeout(),
+                )
+                .await
+            }
             None => HookDecision::Block {
                 reason: Some("no hook type specified".into()),
             },
@@ -441,6 +659,42 @@ mod tests {
         assert!(matches!(result.decision, HookDecision::Block { .. }));
     }
 
+    // --- parse_prompt_response tests ---
+
+    #[test]
+    fn parse_prompt_response_ok_true() {
+        assert_eq!(
+            HookExecutorImpl::parse_prompt_response(r#"{"ok": true}"#),
+            HookDecision::Proceed,
+        );
+    }
+
+    #[test]
+    fn parse_prompt_response_ok_false() {
+        assert_eq!(
+            HookExecutorImpl::parse_prompt_response(r#"{"ok": false, "reason": "tests failing"}"#),
+            HookDecision::Block {
+                reason: Some("tests failing".into())
+            },
+        );
+    }
+
+    #[test]
+    fn parse_prompt_response_ok_false_no_reason() {
+        assert_eq!(
+            HookExecutorImpl::parse_prompt_response(r#"{"ok": false}"#),
+            HookDecision::Block { reason: None },
+        );
+    }
+
+    #[test]
+    fn parse_prompt_response_invalid_json() {
+        assert_eq!(
+            HookExecutorImpl::parse_prompt_response("not json"),
+            HookDecision::Proceed,
+        );
+    }
+
     // --- interpolate_env_vars tests ---
 
     #[test]
diff --git a/crates/arc-workflows/src/hook/types.rs b/crates/arc-workflows/src/hook/types.rs
index 0239193d9..fc7004b41 100644
--- a/crates/arc-workflows/src/hook/types.rs
+++ b/crates/arc-workflows/src/hook/types.rs
@@ -99,6 +99,14 @@ impl HookContext {
     }
 }
 
+/// Response returned by prompt/agent hooks from the LLM.
+#[derive(Debug, Clone, PartialEq, Eq, Deserialize)]
+pub struct PromptHookResponse {
+    pub ok: bool,
+    #[serde(default)]
+    pub reason: Option<String>,
+}
+
 /// Decision returned by blocking hooks.
 #[derive(Debug, Clone, PartialEq, Eq, Serialize, Deserialize)]
 #[serde(tag = "decision", rename_all = "snake_case")]
@@ -324,4 +332,19 @@ mod tests {
     fn hook_decision_default_is_proceed() {
         assert_eq!(HookDecision::default(), HookDecision::Proceed);
     }
+
+    #[test]
+    fn prompt_hook_response_ok_true() {
+        let resp: PromptHookResponse = serde_json::from_str(r#"{"ok": true}"#).unwrap();
+        assert!(resp.ok);
+        assert_eq!(resp.reason, None);
+    }
+
+    #[test]
+    fn prompt_hook_response_ok_false_with_reason() {
+        let resp: PromptHookResponse =
+            serde_json::from_str(r#"{"ok": false, "reason": "not ready"}"#).unwrap();
+        assert!(!resp.ok);
+        assert_eq!(resp.reason.as_deref(), Some("not ready"));
+    }
 }