diff --git a/litellm/proxy/_lazy_openapi_snapshot.json b/litellm/proxy/_lazy_openapi_snapshot.json
index 2c60c05ef7d..4d5a69bd41b 100644
--- a/litellm/proxy/_lazy_openapi_snapshot.json
+++ b/litellm/proxy/_lazy_openapi_snapshot.json
@@ -5707,6 +5707,11 @@
             "installation_preference": {
               "anyOf": [
                 {
+                  "enum": [
+                    "available",
+                    "auto_install",
+                    "required"
+                  ],
                   "type": "string"
                 },
                 {
@@ -5912,13 +5917,18 @@
             "installation_preference": {
               "anyOf": [
                 {
+                  "enum": [
+                    "available",
+                    "auto_install",
+                    "required"
+                  ],
                   "type": "string"
                 },
                 {
                   "type": "null"
                 }
               ],
-              "description": "Claude Code marketplace installationPreference for this plugin (e.g. 'auto_install')",
+              "description": "Emitted as installationPreference on this plugin's marketplace.json entry. Claude Desktop auto-installs an 'auto_install' plugin when the marketplace is served from its inference gateway origin and the plugin is an archive source with a sha256",
               "title": "Installation Preference"
             },
             "keywords": {
@@ -6074,13 +6084,18 @@
             "installation_preference": {
               "anyOf": [
                 {
+                  "enum": [
+                    "available",
+                    "auto_install",
+                    "required"
+                  ],
                   "type": "string"
                 },
                 {
                   "type": "null"
                 }
               ],
-              "description": "Claude Code marketplace installationPreference for this plugin (e.g. 'auto_install')",
+              "description": "Emitted as installationPreference on this plugin's marketplace.json entry. Claude Desktop auto-installs an 'auto_install' plugin when the marketplace is served from its inference gateway origin and the plugin is an archive source with a sha256",
               "title": "Installation Preference"
             },
             "keywords": {
@@ -6277,7 +6292,7 @@
           ]
         },
         "post": {
-          "description": "Register a new plugin in the LiteLLM marketplace.\n\nLiteLLM acts as a registry/discovery layer. Plugins are hosted on\nGitHub/GitLab/Bitbucket or as a zip archive on any https host (e.g. S3).\nClaude Code clones the git source or downloads the archive when users install.\n\nThis endpoint is create-only and never overwrites. If a plugin with\nthe same name already exists it returns 409 Conflict; use\nPUT /claude-code/plugins/{plugin_name} to update an existing plugin.\n\nRequires a proxy admin API key.\n\nParameters:\n    - name: Plugin name (kebab-case)\n    - source: Plugin source reference (github, url, git-subdir, or archive format)\n    - version: Semantic version (optional)\n    - description: Plugin description (optional)\n    - author: Author information (optional)\n    - homepage: Plugin homepage URL (optional)\n    - keywords: Search keywords (optional)\n    - category: Plugin category (optional)\n    - installation_preference: Marketplace installationPreference, e.g. 'auto_install' (optional)\n\nReturns:\n    Registration status (action is always \"created\") and plugin information.\n\nExample:\n    ```bash\n    curl -X POST http://localhost:4000/claude-code/plugins \\\n      -H \"Authorization: Bearer sk-...\" \\\n      -H \"Content-Type: application/json\" \\\n      -d '{\n        \"name\": \"my-plugin\",\n        \"source\": {\"source\": \"github\", \"repo\": \"org/my-plugin\"},\n        \"version\": \"1.0.0\",\n        \"description\": \"My awesome plugin\"\n      }'\n    ```",
+          "description": "Register a new plugin in the LiteLLM marketplace.\n\nLiteLLM acts as a registry/discovery layer. Plugins are hosted on\nGitHub/GitLab/Bitbucket or as a zip archive on any https host (e.g. S3).\nClaude Code clones the git source or downloads the archive when users install.\n\nThis endpoint is create-only and never overwrites. If a plugin with\nthe same name already exists it returns 409 Conflict; use\nPUT /claude-code/plugins/{plugin_name} to update an existing plugin.\n\nRequires a proxy admin API key.\n\nParameters:\n    - name: Plugin name (kebab-case)\n    - source: Plugin source reference (github, url, git-subdir, or archive format)\n    - version: Semantic version (optional)\n    - description: Plugin description (optional)\n    - author: Author information (optional)\n    - homepage: Plugin homepage URL (optional)\n    - keywords: Search keywords (optional)\n    - category: Plugin category (optional)\n    - installation_preference: 'available', 'auto_install', or 'required' (optional)\n\nReturns:\n    Registration status (action is always \"created\") and plugin information.\n\nExample:\n    ```bash\n    curl -X POST http://localhost:4000/claude-code/plugins \\\n      -H \"Authorization: Bearer sk-...\" \\\n      -H \"Content-Type: application/json\" \\\n      -d '{\n        \"name\": \"my-plugin\",\n        \"source\": {\"source\": \"github\", \"repo\": \"org/my-plugin\"},\n        \"version\": \"1.0.0\",\n        \"description\": \"My awesome plugin\"\n      }'\n    ```",
           "operationId": "register_plugin_claude_code_plugins_post",
           "requestBody": {
             "content": {
@@ -6412,7 +6427,7 @@
           ]
         },
         "put": {
-          "description": "Update an existing plugin in the LiteLLM marketplace.\n\nThe plugin is identified by its name in the path, which is the resource\nidentity and cannot be changed here. This is a full replace, not a merge:\nthe manifest is rebuilt from the request body, so any optional field left\nout is reset to its default (e.g. an omitted version is cleared, not kept).\nSend the full desired state.\n\nReturns 404 if no plugin with the given name exists; use\nPOST /claude-code/plugins to create a new plugin.\n\nRequires a proxy admin API key.\n\nParameters:\n    - plugin_name: Name of the plugin to update (path parameter)\n    - source: Plugin source reference (github, url, git-subdir, or archive format)\n    - version: Semantic version (optional)\n    - description: Plugin description (optional)\n    - author: Author information (optional)\n    - homepage: Plugin homepage URL (optional)\n    - keywords: Search keywords (optional)\n    - category: Plugin category (optional)\n    - installation_preference: Marketplace installationPreference, e.g. 'auto_install' (optional)\n\nReturns:\n    Update status (action is always \"updated\") and plugin information.\n\nExample:\n    ```bash\n    curl -X PUT http://localhost:4000/claude-code/plugins/my-plugin \\\n      -H \"Authorization: Bearer sk-...\" \\\n      -H \"Content-Type: application/json\" \\\n      -d '{\n        \"source\": {\"source\": \"github\", \"repo\": \"org/my-plugin\"},\n        \"version\": \"2.0.0\",\n        \"description\": \"My awesome plugin\"\n      }'\n    ```",
+          "description": "Update an existing plugin in the LiteLLM marketplace.\n\nThe plugin is identified by its name in the path, which is the resource\nidentity and cannot be changed here. This is a full replace, not a merge:\nthe manifest is rebuilt from the request body, so any optional field left\nout is reset to its default (e.g. an omitted version is cleared, not kept).\nSend the full desired state.\n\nReturns 404 if no plugin with the given name exists; use\nPOST /claude-code/plugins to create a new plugin.\n\nRequires a proxy admin API key.\n\nParameters:\n    - plugin_name: Name of the plugin to update (path parameter)\n    - source: Plugin source reference (github, url, git-subdir, or archive format)\n    - version: Semantic version (optional)\n    - description: Plugin description (optional)\n    - author: Author information (optional)\n    - homepage: Plugin homepage URL (optional)\n    - keywords: Search keywords (optional)\n    - category: Plugin category (optional)\n    - installation_preference: 'available', 'auto_install', or 'required' (optional)\n\nReturns:\n    Update status (action is always \"updated\") and plugin information.\n\nExample:\n    ```bash\n    curl -X PUT http://localhost:4000/claude-code/plugins/my-plugin \\\n      -H \"Authorization: Bearer sk-...\" \\\n      -H \"Content-Type: application/json\" \\\n      -d '{\n        \"source\": {\"source\": \"github\", \"repo\": \"org/my-plugin\"},\n        \"version\": \"2.0.0\",\n        \"description\": \"My awesome plugin\"\n      }'\n    ```",
           "operationId": "update_plugin_claude_code_plugins__plugin_name__put",
           "parameters": [
             {
diff --git a/litellm/proxy/anthropic_endpoints/claude_code_endpoints/claude_code_marketplace.py b/litellm/proxy/anthropic_endpoints/claude_code_endpoints/claude_code_marketplace.py
index 8832cfdc9ce..ec84bed8000 100644
--- a/litellm/proxy/anthropic_endpoints/claude_code_endpoints/claude_code_marketplace.py
+++ b/litellm/proxy/anthropic_endpoints/claude_code_endpoints/claude_code_marketplace.py
@@ -38,6 +38,7 @@ from litellm.proxy.auth.user_api_key_auth import user_api_key_auth
 from litellm.proxy.common_utils.resource_ownership import is_proxy_admin
 from litellm.repositories.table_repositories import ClaudeCodePluginRepository
 from litellm.types.proxy.claude_code_endpoints import (
+    InstallationPreference,
     ListPluginsResponse,
     PluginListItem,
     PluginResponse,
@@ -71,12 +72,18 @@ class _MarketplaceEntry(TypedDict, total=False):
     homepage: object
     keywords: object
     category: object
-    installationPreference: ReadOnly[str]
+    installationPreference: ReadOnly[InstallationPreference]
 
 
-def _get_manifest_string(manifest: Mapping[str, object], key: str) -> str | None:
-    value: Final = manifest.get(key)
-    return value if isinstance(value, str) else None
+def _get_installation_preference(manifest: Mapping[str, object]) -> InstallationPreference | None:
+    value: Final = manifest.get("installation_preference")
+    if not isinstance(value, str):
+        return None
+    match value:
+        case "available" | "auto_install" | "required":
+            return value
+        case _:
+            return None
 
 
 async def _get_prisma_client() -> object:
@@ -143,10 +150,16 @@ async def get_marketplace(request: Request, key: str | None = None):
                 verbose_proxy_logger.warning("Plugin %s has no source field, skipping", plugin.name)
                 continue
 
-            entry: _MarketplaceEntry = {
-                "name": plugin.name,
-                "source": manifest["source"],
-            }
+            installation_preference = _get_installation_preference(manifest)
+            entry: _MarketplaceEntry = (
+                {"name": plugin.name, "source": manifest["source"]}
+                if installation_preference is None
+                else {
+                    "name": plugin.name,
+                    "source": manifest["source"],
+                    "installationPreference": installation_preference,
+                }
+            )
 
             if plugin.version:
                 entry["version"] = plugin.version
@@ -160,10 +173,6 @@ async def get_marketplace(request: Request, key: str | None = None):
                 entry["keywords"] = manifest["keywords"]
             if "category" in manifest:
                 entry["category"] = manifest["category"]
-            if (installation_preference := _get_manifest_string(manifest, "installation_preference")) is not None:
-                entry["installationPreference"] = (  # pyright: ignore[reportTypedDictNotRequiredAccess]  # assembled incrementally
-                    installation_preference
-                )
 
             plugin_list.append(entry)
 
@@ -317,7 +326,7 @@ async def register_plugin(
         - homepage: Plugin homepage URL (optional)
         - keywords: Search keywords (optional)
         - category: Plugin category (optional)
-        - installation_preference: Marketplace installationPreference, e.g. 'auto_install' (optional)
+        - installation_preference: 'available', 'auto_install', or 'required' (optional)
 
     Returns:
         Registration status (action is always "created") and plugin information.
@@ -447,7 +456,7 @@ async def list_plugins(
                     category=manifest.get("category"),
                     domain=manifest.get("domain"),
                     namespace=manifest.get("namespace"),
-                    installation_preference=_get_manifest_string(manifest, "installation_preference"),
+                    installation_preference=_get_installation_preference(manifest),
                     enabled=p.enabled,
                     created_at=p.created_at.isoformat() if p.created_at else None,
                     updated_at=p.updated_at.isoformat() if p.updated_at else None,
@@ -521,7 +530,7 @@ async def get_plugin(
             "homepage": manifest.get("homepage"),
             "keywords": manifest.get("keywords"),
             "category": manifest.get("category"),
-            "installation_preference": manifest.get("installation_preference"),
+            "installation_preference": _get_installation_preference(manifest),
             "enabled": plugin.enabled,
             "created_at": plugin.created_at.isoformat() if plugin.created_at else None,
             "updated_at": plugin.updated_at.isoformat() if plugin.updated_at else None,
@@ -572,7 +581,7 @@ async def update_plugin(
         - homepage: Plugin homepage URL (optional)
         - keywords: Search keywords (optional)
         - category: Plugin category (optional)
-        - installation_preference: Marketplace installationPreference, e.g. 'auto_install' (optional)
+        - installation_preference: 'available', 'auto_install', or 'required' (optional)
 
     Returns:
         Update status (action is always "updated") and plugin information.
diff --git a/litellm/types/proxy/claude_code_endpoints.py b/litellm/types/proxy/claude_code_endpoints.py
index aff39a36a10..5ba629d11a8 100644
--- a/litellm/types/proxy/claude_code_endpoints.py
+++ b/litellm/types/proxy/claude_code_endpoints.py
@@ -2,8 +2,12 @@
 Claude Code Marketplace endpoint types for LiteLLM Proxy
 """
 
+from typing import Literal, TypeAlias
+
 from pydantic import BaseModel, Field
 
+InstallationPreference: TypeAlias = Literal["available", "auto_install", "required"]
+
 
 class PluginAuthor(BaseModel):
     """Plugin author information."""
@@ -41,9 +45,13 @@ class PluginSpec(BaseModel):
     category: str | None = Field(None, description="Plugin category")
     domain: str | None = Field(None, description="Skill domain (e.g., 'Productivity')")
     namespace: str | None = Field(None, description="Skill namespace within domain (e.g., 'workflows')")
-    installation_preference: str | None = Field(
+    installation_preference: InstallationPreference | None = Field(
         None,
-        description="Claude Code marketplace installationPreference for this plugin (e.g. 'auto_install')",
+        description=(
+            "Emitted as installationPreference on this plugin's marketplace.json entry. Claude Desktop auto-installs "
+            "an 'auto_install' plugin when the marketplace is served from its inference gateway origin and the "
+            "plugin is an archive source with a sha256"
+        ),
     )
 
 
@@ -108,7 +116,7 @@ class PluginListItem(BaseModel):
     category: str | None = None
     domain: str | None = None
     namespace: str | None = None
-    installation_preference: str | None = None
+    installation_preference: InstallationPreference | None = None
     enabled: bool
     created_at: str | None
     updated_at: str | None
@@ -132,7 +140,6 @@ class MarketplacePluginEntry(BaseModel):
     homepage: str | None = None
     keywords: list[str] | None = None
     category: str | None = None
-    installation_preference: str | None = None
 
 
 class MarketplaceResponse(BaseModel):
diff --git a/tests/test_litellm/proxy/anthropic_endpoints/test_claude_code_marketplace.py b/tests/test_litellm/proxy/anthropic_endpoints/test_claude_code_marketplace.py
index c91b77c2669..4ec435cf7cd 100644
--- a/tests/test_litellm/proxy/anthropic_endpoints/test_claude_code_marketplace.py
+++ b/tests/test_litellm/proxy/anthropic_endpoints/test_claude_code_marketplace.py
@@ -9,6 +9,7 @@ from unittest.mock import AsyncMock, MagicMock
 
 import pytest
 from fastapi import HTTPException
+from pydantic import ValidationError
 
 import litellm
 from litellm.proxy._types import LiteLLM_ObjectPermissionTable, ProxyException, UserAPIKeyAuth
@@ -364,19 +365,37 @@ async def test_get_marketplace_key_query_param_adds_granted_disabled_plugins(mon
 
 
 @pytest.mark.asyncio
-async def test_get_marketplace_emits_installation_preference():
+@pytest.mark.parametrize("preference", ["available", "auto_install", "required"])
+async def test_get_marketplace_emits_installation_preference(preference):
     await register_plugin(
         request=RegisterPluginRequest(
-            name="auto-install-plugin",
-            source=_GIT_SUBDIR_SOURCE,
-            installation_preference="auto_install",
+            name="s3-skill",
+            source=_ARCHIVE_SOURCE,
+            installation_preference=preference,
         ),
         user_api_key_dict=_USER,
     )
 
     marketplace = json.loads((await get_marketplace(request=MagicMock())).body)
 
-    assert marketplace["plugins"][0]["installationPreference"] == "auto_install"
+    assert marketplace["plugins"] == [
+        {"name": "s3-skill", "source": _ARCHIVE_SOURCE, "version": "1.0.0", "installationPreference": preference}
+    ]
+
+
+@pytest.mark.parametrize(
+    "build_request",
+    [
+        lambda preference: RegisterPluginRequest(
+            name="s3-skill", source=_ARCHIVE_SOURCE, installation_preference=preference
+        ),
+        lambda preference: UpdatePluginRequest(source=_ARCHIVE_SOURCE, installation_preference=preference),
+    ],
+    ids=["register", "update"],
+)
+def test_plugin_request_rejects_unknown_installation_preference(build_request):
+    with pytest.raises(ValidationError, match="installation_preference"):
+        build_request("auto-install")
 
 
 @pytest.mark.asyncio
@@ -415,6 +434,24 @@ async def test_update_plugin_propagates_installation_preference_to_get_and_list(
     assert listed_plugin.installation_preference == "auto_install"
 
 
+@pytest.mark.asyncio
+async def test_update_plugin_without_installation_preference_clears_it():
+    name = "cleared-install-plugin"
+    await register_plugin(
+        request=RegisterPluginRequest(name=name, source=_ARCHIVE_SOURCE, installation_preference="auto_install"),
+        user_api_key_dict=_USER,
+    )
+
+    await update_plugin(
+        plugin_name=name,
+        request=UpdatePluginRequest(source=_ARCHIVE_SOURCE),
+        user_api_key_dict=_USER,
+    )
+
+    marketplace = json.loads((await get_marketplace(request=MagicMock())).body)
+    assert "installationPreference" not in marketplace["plugins"][0]
+
+
 @pytest.mark.asyncio
 async def test_register_plugin_git_subdir_missing_url():
     """git-subdir without url field raises HTTP 400."""
diff --git a/ui/litellm-dashboard/src/lib/http/schema.d.ts b/ui/litellm-dashboard/src/lib/http/schema.d.ts
index 8f9fbe95b89..70002792c97 100644
--- a/ui/litellm-dashboard/src/lib/http/schema.d.ts
+++ b/ui/litellm-dashboard/src/lib/http/schema.d.ts
@@ -2344,7 +2344,7 @@ export interface paths {
          *         - homepage: Plugin homepage URL (optional)
          *         - keywords: Search keywords (optional)
          *         - category: Plugin category (optional)
-         *         - installation_preference: Marketplace installationPreference, e.g. 'auto_install' (optional)
+         *         - installation_preference: 'available', 'auto_install', or 'required' (optional)
          *
          *     Returns:
          *         Registration status (action is always "created") and plugin information.
@@ -2411,7 +2411,7 @@ export interface paths {
          *         - homepage: Plugin homepage URL (optional)
          *         - keywords: Search keywords (optional)
          *         - category: Plugin category (optional)
-         *         - installation_preference: Marketplace installationPreference, e.g. 'auto_install' (optional)
+         *         - installation_preference: 'available', 'auto_install', or 'required' (optional)
          *
          *     Returns:
          *         Update status (action is always "updated") and plugin information.
@@ -38004,7 +38004,7 @@ export interface components {
             /** Id */
             id: string;
             /** Installation Preference */
-            installation_preference?: string | null;
+            installation_preference?: ("available" | "auto_install" | "required") | null;
             /** Keywords */
             keywords?: string[] | null;
             /** Name */
@@ -39458,9 +39458,9 @@ export interface components {
             homepage?: string | null;
             /**
              * Installation Preference
-             * @description Claude Code marketplace installationPreference for this plugin (e.g. 'auto_install')
+             * @description Emitted as installationPreference on this plugin's marketplace.json entry. Claude Desktop auto-installs an 'auto_install' plugin when the marketplace is served from its inference gateway origin and the plugin is an archive source with a sha256
              */
-            installation_preference?: string | null;
+            installation_preference?: ("available" | "auto_install" | "required") | null;
             /**
              * Keywords
              * @description Search keywords
@@ -44882,9 +44882,9 @@ export interface components {
             homepage?: string | null;
             /**
              * Installation Preference
-             * @description Claude Code marketplace installationPreference for this plugin (e.g. 'auto_install')
+             * @description Emitted as installationPreference on this plugin's marketplace.json entry. Claude Desktop auto-installs an 'auto_install' plugin when the marketplace is served from its inference gateway origin and the plugin is an archive source with a sha256
              */
-            installation_preference?: string | null;
+            installation_preference?: ("available" | "auto_install" | "required") | null;
             /**
              * Keywords
              * @description Search keywords