diff --git a/Cargo.lock b/Cargo.lock
index dd20e41..52ebbdb 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -828,6 +828,15 @@ dependencies = [
  "cfg-if",
 ]
 
+[[package]]
+name = "crossbeam-channel"
+version = "0.5.15"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "82b8f8f868b36967f9606790d1903570de9ceaf870a7bf9fbbd3016d636a2cb2"
+dependencies = [
+ "crossbeam-utils",
+]
+
 [[package]]
 name = "crossbeam-deque"
 version = "0.8.6"
@@ -1357,7 +1366,7 @@ dependencies = [
  "libc",
  "option-ext",
  "redox_users",
- "windows-sys 0.61.2",
+ "windows-sys 0.59.0",
 ]
 
 [[package]]
@@ -1482,7 +1491,7 @@ source = "registry+https://github.com/rust-lang/crates.io-index"
 checksum = "39cab71617ae0d63f51a36d69f866391735b51691dbda63cf6f96d042b63efeb"
 dependencies = [
  "libc",
- "windows-sys 0.61.2",
+ "windows-sys 0.59.0",
 ]
 
 [[package]]
@@ -3070,9 +3079,9 @@ dependencies = [
 
 [[package]]
 name = "mistralai-client"
-version = "1.1.0"
+version = "1.2.0"
 source = "sparse+https://src.sunbeam.pt/api/packages/studio/cargo/"
-checksum = "6a17c5600508f30965a8e6ab78e947a0db7017edef8ffb022aa9ac71f50ebaff"
+checksum = "24258b2ba72432f9c147a5a80e6d862c7b3c43db859135c619c948cf6c9e4fdf"
 dependencies = [
  "async-stream",
  "async-trait",
@@ -3154,7 +3163,7 @@ version = "0.50.3"
 source = "registry+https://github.com/rust-lang/crates.io-index"
 checksum = "7957b9740744892f114936ab4a57b3f487491bbeafaf8083688b16841a4240e5"
 dependencies = [
- "windows-sys 0.61.2",
+ "windows-sys 0.59.0",
 ]
 
 [[package]]
@@ -3777,7 +3786,7 @@ dependencies = [
  "once_cell",
  "socket2",
  "tracing",
- "windows-sys 0.60.2",
+ "windows-sys 0.59.0",
 ]
 
 [[package]]
@@ -4290,7 +4299,7 @@ dependencies = [
  "errno",
  "libc",
  "linux-raw-sys 0.12.1",
- "windows-sys 0.61.2",
+ "windows-sys 0.59.0",
 ]
 
 [[package]]
@@ -4736,6 +4745,7 @@ dependencies = [
  "tonic-prost",
  "tonic-prost-build",
  "tracing",
+ "tracing-appender",
  "tracing-subscriber",
  "tree-sitter",
  "tree-sitter-python",
@@ -5355,7 +5365,7 @@ dependencies = [
  "getrandom 0.4.2",
  "once_cell",
  "rustix 1.1.4",
- "windows-sys 0.61.2",
+ "windows-sys 0.59.0",
 ]
 
 [[package]]
@@ -5838,6 +5848,18 @@ dependencies = [
  "tracing-core",
 ]
 
+[[package]]
+name = "tracing-appender"
+version = "0.2.4"
+source = "registry+https://github.com/rust-lang/crates.io-index"
+checksum = "786d480bce6247ab75f005b14ae1624ad978d3029d9113f0a22fa1ac773faeaf"
+dependencies = [
+ "crossbeam-channel",
+ "thiserror 2.0.18",
+ "time",
+ "tracing-subscriber",
+]
+
 [[package]]
 name = "tracing-attributes"
 version = "0.1.31"
@@ -6425,7 +6447,7 @@ version = "0.1.11"
 source = "registry+https://github.com/rust-lang/crates.io-index"
 checksum = "c2a7b1c03c876122aa43f3020e6c3c3ee5c05081c9a00739faf7503aeba10d22"
 dependencies = [
- "windows-sys 0.61.2",
+ "windows-sys 0.59.0",
 ]
 
 [[package]]
diff --git a/Cargo.toml b/Cargo.toml
index 492b84b..9bbd6b9 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -13,7 +13,7 @@ name = "sol"
 path = "src/main.rs"
 
 [dependencies]
-mistralai-client = { version = "1.1.0", registry = "sunbeam" }
+mistralai-client = { version = "1.2.0", registry = "sunbeam" }
 matrix-sdk = { version = "0.9", features = ["e2e-encryption", "sqlite"] }
 opensearch = "2"
 tokio = { version = "1", features = ["full"] }
diff --git a/src/grpc/service.rs b/src/grpc/service.rs
index c368418..1b18f75 100644
--- a/src/grpc/service.rs
+++ b/src/grpc/service.rs
@@ -314,7 +314,7 @@ async fn session_chat_via_orchestrator(
 ) -> anyhow::Result<()> {
     use crate::orchestrator::event::*;
 
-    let conversation_response = session.create_or_append_conversation(text).await?;
+    let conversation_response = session.create_or_append_conversation_streaming(text, tx).await?;
     session.post_to_matrix(text).await;
 
     let request_id = RequestId::new();
diff --git a/src/grpc/session.rs b/src/grpc/session.rs
index c86c530..7075896 100644
--- a/src/grpc/session.rs
+++ b/src/grpc/session.rs
@@ -388,46 +388,160 @@ you also have access to server-side tools: search_archive, search_web, research,
         tools
     }
 
-    /// Create or append to the Mistral conversation. Returns the response
-    /// for the orchestrator to run through its tool loop.
-    pub async fn create_or_append_conversation(
+    /// Create or append to the Mistral conversation with streaming.
+    /// Emits TextDelta messages to the gRPC client as chunks arrive.
+    /// Returns the accumulated response for the orchestrator's tool loop.
+    pub async fn create_or_append_conversation_streaming(
         &mut self,
         text: &str,
+        client_tx: &tokio::sync::mpsc::Sender<Result<ServerMessage, tonic::Status>>,
     ) -> anyhow::Result<ConversationResponse> {
+        use futures::StreamExt;
+        use mistralai_client::v1::conversation_stream::{self, ConversationEvent};
+
         let context_header = self.build_context_header(text).await;
         let input_text = format!("{context_header}\n{text}");
 
+        let conv_id_for_accumulate: String;
+        let mut events = Vec::new();
+
         if let Some(ref conv_id) = self.conversation_id {
+            conv_id_for_accumulate = conv_id.clone();
             let req = AppendConversationRequest {
                 inputs: ConversationInput::Text(input_text.clone()),
                 completion_args: None,
                 handoff_execution: None,
                 store: Some(true),
                 tool_confirmations: None,
-                stream: false,
+                stream: true,
             };
-            match self.state
-                .mistral
-                .append_conversation_async(conv_id, &req)
+            match self.state.mistral
+                .append_conversation_stream_async(conv_id, &req)
                 .await
             {
-                Ok(resp) => Ok(resp),
+                Ok(stream) => {
+                    tokio::pin!(stream);
+                    while let Some(result) = stream.next().await {
+                        match result {
+                            Ok(event) => {
+                                if let Some(delta) = event.text_delta() {
+                                    let _ = client_tx.send(Ok(ServerMessage {
+                                        payload: Some(server_message::Payload::Delta(TextDelta {
+                                            text: delta,
+                                        })),
+                                    })).await;
+                                }
+                                events.push(event);
+                            }
+                            Err(e) => {
+                                warn!("Stream event error: {}", e.message);
+                            }
+                        }
+                    }
+                }
                 Err(e) if e.message.contains("function calls and responses")
                     || e.message.contains("invalid_request_error") =>
                 {
                     warn!(
                         conversation_id = conv_id.as_str(),
                         error = e.message.as_str(),
-                        "Conversation corrupted — creating fresh conversation"
+                        "Conversation corrupted — creating fresh conversation (streaming)"
                     );
                     self.conversation_id = None;
-                    self.create_fresh_conversation(input_text).await
+                    return self.create_fresh_conversation_streaming(input_text, client_tx).await;
                 }
-                Err(e) => Err(anyhow::anyhow!("append_conversation failed: {}", e.message)),
+                Err(e) => return Err(anyhow::anyhow!("append_conversation_stream failed: {}", e.message)),
             }
         } else {
-            self.create_fresh_conversation(input_text).await
+            return self.create_fresh_conversation_streaming(input_text, client_tx).await;
         }
+
+        Ok(conversation_stream::accumulate(&conv_id_for_accumulate, &events))
+    }
+
+    /// Create a fresh streaming conversation — used on first message or after corruption.
+    async fn create_fresh_conversation_streaming(
+        &mut self,
+        input_text: String,
+        client_tx: &tokio::sync::mpsc::Sender<Result<ServerMessage, tonic::Status>>,
+    ) -> anyhow::Result<ConversationResponse> {
+        use futures::StreamExt;
+        use mistralai_client::v1::conversation_stream::{self, ConversationEvent};
+
+        let instructions = self.build_instructions();
+        let req = CreateConversationRequest {
+            inputs: ConversationInput::Text(input_text),
+            model: Some(self.model.clone()),
+            agent_id: None,
+            agent_version: None,
+            name: Some(format!("code-{}", self.project_name)),
+            description: None,
+            instructions: Some(instructions),
+            completion_args: None,
+            tools: Some(self.build_tool_definitions()),
+            handoff_execution: None,
+            metadata: None,
+            store: Some(true),
+            stream: true,
+        };
+
+        let stream = self.state.mistral
+            .create_conversation_stream_async(&req)
+            .await
+            .map_err(|e| anyhow::anyhow!("create_conversation_stream failed: {}", e.message))?;
+
+        tokio::pin!(stream);
+        let mut events = Vec::new();
+        let mut conversation_id = String::new();
+
+        while let Some(result) = stream.next().await {
+            match result {
+                Ok(event) => {
+                    if let Some(delta) = event.text_delta() {
+                        let _ = client_tx.send(Ok(ServerMessage {
+                            payload: Some(server_message::Payload::Delta(TextDelta {
+                                text: delta,
+                            })),
+                        })).await;
+                    }
+                    events.push(event);
+                }
+                Err(e) => {
+                    warn!("Stream event error: {}", e.message);
+                }
+            }
+        }
+
+        let resp = conversation_stream::accumulate(&conversation_id, &events);
+
+        // Extract conversation_id from the accumulated response
+        if !resp.conversation_id.is_empty() {
+            conversation_id = resp.conversation_id.clone();
+        }
+
+        // If we still don't have a conversation_id, the streaming didn't return one.
+        // This happens with the Conversations API — the ID comes from the response headers
+        // or the ResponseDone event. Let's check events for it.
+        if conversation_id.is_empty() {
+            // Fallback: create non-streaming to get the conversation_id
+            warn!("Streaming didn't return conversation_id — falling back to non-streaming create");
+            return self.create_fresh_conversation(
+                "".into() // empty — conversation already created, just need the ID
+            ).await;
+        }
+
+        self.conversation_id = Some(conversation_id.clone());
+        self.state.store.set_code_session_conversation(
+            &self.session_id,
+            &conversation_id,
+        );
+
+        info!(
+            conversation_id = conversation_id.as_str(),
+            "Created streaming Mistral conversation for code session"
+        );
+
+        Ok(resp)
     }
 
     /// Post user message to the Matrix room.
diff --git a/src/integration_test.rs b/src/integration_test.rs
index ad0c538..1d426f6 100644
--- a/src/integration_test.rs
+++ b/src/integration_test.rs
@@ -6051,3 +6051,213 @@ class Calculator:
         assert!(sessions.is_empty(), "Session should be marked complete, not running");
     }
 }
+
+// ══════════════════════════════════════════════════════════════════════════
+// Conversation streaming — Mistral API integration
+// ══════════════════════════════════════════════════════════════════════════
+
+mod conversation_stream_tests {
+    use futures::StreamExt;
+    use mistralai_client::v1::conversation_stream::{self, ConversationEvent};
+    use mistralai_client::v1::conversations::*;
+
+    fn load_env() -> Option<String> {
+        let env_path = std::path::Path::new(env!("CARGO_MANIFEST_DIR")).join(".env");
+        if let Ok(contents) = std::fs::read_to_string(&env_path) {
+            for line in contents.lines() {
+                let line = line.trim();
+                if line.is_empty() || line.starts_with('#') { continue; }
+                if let Some((k, v)) = line.split_once('=') {
+                    std::env::set_var(k.trim(), v.trim());
+                }
+            }
+        }
+        std::env::var("SOL_MISTRAL_API_KEY").ok()
+    }
+
+    #[tokio::test]
+    async fn test_streaming_create_conversation() {
+        let Some(api_key) = load_env() else { eprintln!("Skipping: no API key"); return; };
+        let client = mistralai_client::v1::client::Client::new(Some(api_key), None, None, None).unwrap();
+
+        let req = CreateConversationRequest {
+            inputs: ConversationInput::Text("What is 7 * 8? Answer with just the number.".into()),
+            model: Some("mistral-medium-latest".into()),
+            agent_id: None,
+            agent_version: None,
+            name: None,
+            description: None,
+            instructions: Some("Answer concisely.".into()),
+            completion_args: None,
+            tools: None,
+            handoff_execution: None,
+            metadata: None,
+            store: Some(false),
+            stream: true,
+        };
+
+        let stream = client.create_conversation_stream_async(&req).await.unwrap();
+        tokio::pin!(stream);
+
+        let mut events = Vec::new();
+        let mut saw_text = false;
+        let mut saw_done = false;
+
+        while let Some(result) = stream.next().await {
+            let event = result.unwrap();
+            if event.text_delta().is_some() { saw_text = true; }
+            if matches!(&event, ConversationEvent::ResponseDone { .. }) { saw_done = true; }
+            events.push(event);
+        }
+
+        assert!(saw_text, "Should receive text deltas");
+        assert!(saw_done, "Should receive ResponseDone");
+
+        let resp = conversation_stream::accumulate("", &events);
+        let text = resp.assistant_text().unwrap_or_default();
+        assert!(text.contains("56"), "Should compute 7*8=56, got: {text}");
+        assert!(resp.usage.total_tokens > 0, "Should have token usage");
+    }
+
+    #[tokio::test]
+    async fn test_streaming_append_conversation() {
+        let Some(api_key) = load_env() else { eprintln!("Skipping: no API key"); return; };
+        let client = mistralai_client::v1::client::Client::new(Some(api_key), None, None, None).unwrap();
+
+        // Create non-streaming first
+        let create_req = CreateConversationRequest {
+            inputs: ConversationInput::Text("The magic word is SUNBEAM. Just say ok.".into()),
+            model: Some("mistral-medium-latest".into()),
+            agent_id: None,
+            agent_version: None,
+            name: None,
+            description: None,
+            instructions: Some("Be brief.".into()),
+            completion_args: None,
+            tools: None,
+            handoff_execution: None,
+            metadata: None,
+            store: Some(true),
+            stream: false,
+        };
+        let created = client.create_conversation_async(&create_req).await.unwrap();
+
+        // Append with streaming
+        let append_req = AppendConversationRequest {
+            inputs: ConversationInput::Text("What is the magic word?".into()),
+            completion_args: None,
+            handoff_execution: None,
+            store: Some(true),
+            tool_confirmations: None,
+            stream: true,
+        };
+        let stream = client
+            .append_conversation_stream_async(&created.conversation_id, &append_req)
+            .await
+            .unwrap();
+        tokio::pin!(stream);
+
+        let mut events = Vec::new();
+        while let Some(result) = stream.next().await {
+            events.push(result.unwrap());
+        }
+
+        let resp = conversation_stream::accumulate(&created.conversation_id, &events);
+        let text = resp.assistant_text().unwrap_or_default().to_uppercase();
+        assert!(text.contains("SUNBEAM"), "Should recall magic word, got: {text}");
+
+        // Cleanup
+        let _ = client.delete_conversation_async(&created.conversation_id).await;
+    }
+
+    #[test]
+    fn test_parse_sse_line_data_prefix() {
+        let line = r#"data: {"type":"conversation.response.started"}"#;
+        let event = conversation_stream::parse_sse_line(line).unwrap();
+        assert!(event.is_some());
+        assert!(matches!(event.unwrap(), ConversationEvent::ResponseStarted { .. }));
+    }
+
+    #[test]
+    fn test_parse_sse_line_event_prefix_skipped() {
+        let line = "event: conversation.response.started";
+        assert!(conversation_stream::parse_sse_line(line).unwrap().is_none());
+    }
+
+    #[test]
+    fn test_parse_sse_line_done() {
+        assert!(conversation_stream::parse_sse_line("data: [DONE]").unwrap().is_none());
+    }
+
+    #[test]
+    fn test_parse_sse_line_empty() {
+        assert!(conversation_stream::parse_sse_line("").unwrap().is_none());
+        assert!(conversation_stream::parse_sse_line("   ").unwrap().is_none());
+    }
+
+    #[test]
+    fn test_accumulate_text_and_usage() {
+        let events = vec![
+            ConversationEvent::ResponseStarted { created_at: None },
+            ConversationEvent::MessageOutput {
+                id: "m1".into(),
+                content: serde_json::json!("hello "),
+                role: "assistant".into(),
+                output_index: 0,
+                content_index: 0,
+                model: None,
+            },
+            ConversationEvent::MessageOutput {
+                id: "m1".into(),
+                content: serde_json::json!("world"),
+                role: "assistant".into(),
+                output_index: 0,
+                content_index: 0,
+                model: None,
+            },
+            ConversationEvent::ResponseDone {
+                usage: ConversationUsageInfo {
+                    prompt_tokens: 10,
+                    completion_tokens: 5,
+                    total_tokens: 15,
+                },
+                created_at: None,
+            },
+        ];
+
+        let resp = conversation_stream::accumulate("conv-123", &events);
+        assert_eq!(resp.conversation_id, "conv-123");
+        assert_eq!(resp.assistant_text().unwrap(), "hello world");
+        assert_eq!(resp.usage.total_tokens, 15);
+    }
+
+    #[test]
+    fn test_accumulate_with_function_calls() {
+        let events = vec![
+            ConversationEvent::FunctionCall {
+                id: "fc-1".into(),
+                name: "search_web".into(),
+                tool_call_id: "tc-1".into(),
+                arguments: r#"{"query":"rust"}"#.into(),
+                output_index: 0,
+                model: None,
+                confirmation_status: None,
+            },
+            ConversationEvent::ResponseDone {
+                usage: ConversationUsageInfo {
+                    prompt_tokens: 20,
+                    completion_tokens: 10,
+                    total_tokens: 30,
+                },
+                created_at: None,
+            },
+        ];
+
+        let resp = conversation_stream::accumulate("conv-456", &events);
+        assert!(resp.assistant_text().is_none());
+        let calls = resp.function_calls();
+        assert_eq!(calls.len(), 1);
+        assert_eq!(calls[0].name, "search_web");
+        assert_eq!(calls[0].tool_call_id.as_deref(), Some("tc-1"));
+    }
+}