diff --git a/agent/redact.py b/agent/redact.py
index ea70246a90797..666cfac76c5ac 100644
--- a/agent/redact.py
+++ b/agent/redact.py
@@ -130,7 +130,10 @@ _PREFIX_PATTERNS = [
     r"GR1348941[A-Za-z0-9_\-]{10,}",    # GitLab legacy runner registration token
 ]
 
-# ENV assignment patterns: KEY=value where KEY contains a secret-like name.
+
+
+
+# Generic ENV assignment patterns: KEY=value where KEY contains a secret-like name.
 # Uppercase keys tolerate spaces around "=" (e.g. ``FOO_SECRET = bar``) because
 # an all-caps key is almost never prose/code.
 _SECRET_ENV_NAMES = r"(?:API_?KEY|TOKEN|SECRET|PASSWORD|PASSWD|CREDENTIAL|AUTH)"
@@ -720,6 +723,7 @@ def redact_sensitive_text(
         _prefix_sub = _mask_token_nonreusable if file_read else _mask_token
         text = _PREFIX_RE.sub(lambda m: _prefix_sub(m.group(1)), text)
 
+
     # ENV assignments: OPENAI_API_KEY=***  (skip for code files — false positives)
     if not code_file:
         if "=" in text:
@@ -888,6 +892,65 @@ def redact_sensitive_text(
 # fixtures, ``postgresql://{user}`` f-string templates). See issue #43025.
 _ENV_DUMP_COMMANDS = frozenset({"env", "printenv", "set", "export", "declare"})
 
+# Commands that read file contents to stdout. When the target is a ``.env``
+# file, the output is a credential dump — the same as ``printenv`` — so the
+# ENV-assignment pass must run (code_file=False). Per AGENTS.md, ``.env`` is
+# for secrets only; behavioral settings belong in config.yaml, so running
+# the generic ENV redactor on ``.env`` content is the correct behavior.
+_FILE_READ_COMMANDS = frozenset({
+    "cat", "head", "tail", "type", "bat", "less", "more", "nl",
+    "zcat", "tac", "view", "batcat",
+})
+
+# Basenames that are treated as ``.env`` files for redaction purposes.
+# Matches the list in ``agent/file_safety._BLOCKED_PROJECT_ENV_BASENAMES``
+# so the two defenses stay aligned: if file_tools blocks a read, and the
+# agent falls back to ``cat``, the terminal redactor still catches it.
+_ENV_FILE_BASENAMES = frozenset({
+    ".env", ".env.local", ".env.development", ".env.production",
+    ".env.test", ".env.staging", ".envrc",
+})
+
+# Filename suffixes that look like ``.env`` but are NOT secret-bearing
+# (templates, examples). These are explicitly excluded so the agent can
+# read template files without redaction interfering.
+_ENV_FILE_EXCLUDE_SUFFIXES = (".example", ".sample", ".template", ".dist")
+
+
+def _command_reads_env_file(command: str) -> bool:
+    """Return True if ``command`` reads a ``.env`` file to stdout.
+
+    Detects file-read commands (``cat``, ``head``, ``tail``, etc.) where any
+    argument ends with a ``.env``-style basename and is NOT a template
+    (``.env.example``, ``.env.sample``). Handles pipelines and sequences.
+    """
+    if not command:
+        return False
+    segments = re.split(r"[|;&]+", command)
+    for seg in segments:
+        seg = seg.strip()
+        if not seg:
+            continue
+        # Use plain split() instead of shlex.split — shlex treats backslashes
+        # as escape chars, which mangles Windows paths (``C:\Users\...\.env``).
+        # We only need the command name and filename, so shell quoting is not
+        # a concern here.
+        tokens = seg.split()
+        if not tokens or tokens[0] not in _FILE_READ_COMMANDS:
+            continue
+        # Check all arguments (skip flags like -n, -A, etc.)
+        for arg in tokens[1:]:
+            if arg.startswith("-"):
+                continue
+            # Strip any leading path to get the basename. Handle both / and \.
+            basename = arg.rsplit("/", 1)[-1].rsplit("\\", 1)[-1]
+            # Exclude templates/examples.
+            if any(basename.endswith(suf) for suf in _ENV_FILE_EXCLUDE_SUFFIXES):
+                continue
+            if basename in _ENV_FILE_BASENAMES:
+                return True
+    return False
+
 
 def is_env_dump_command(command: str | None) -> bool:
     """Return True if ``command`` dumps environment variables to stdout.
@@ -923,10 +986,14 @@ def redact_terminal_output(
     Single redaction policy for ALL terminal-output surfaces — foreground
     ``terminal`` results AND background ``process(action=poll/log/wait)``
     output — so they can't diverge. Picks ``code_file`` based on whether
-    ``command`` is an environment dump:
+    ``command`` is an environment dump or reads a ``.env`` file:
 
     - env-dump command (``env``/``printenv``/``set``/``export``/``declare``)
       → ``code_file=False`` so the ENV-assignment pass masks opaque tokens.
+    - file-read command targeting a ``.env`` file (``cat .env``,
+      ``head .env.local``, etc.) → ``code_file=False`` for the same reason.
+      Per AGENTS.md, ``.env`` files contain only secrets, so the generic
+      ENV redactor is the correct pass — no list of known var names needed.
     - anything else (or unknown command) → ``code_file=True`` to avoid
       false positives on source/config dumps.
 
@@ -935,7 +1002,8 @@ def redact_terminal_output(
     """
     if not output:
         return output
-    code_file = not is_env_dump_command(command or "")
+    cmd = command or ""
+    code_file = not (is_env_dump_command(cmd) or _command_reads_env_file(cmd))
     return redact_sensitive_text(output, force=force, code_file=code_file)
 
 
diff --git a/tests/agent/test_redact.py b/tests/agent/test_redact.py
index 68307c7381d2a..b5d0243769185 100644
--- a/tests/agent/test_redact.py
+++ b/tests/agent/test_redact.py
@@ -677,9 +677,10 @@ class TestTerminalOutputRedaction:
     """is_env_dump_command + redact_terminal_output — issue #43025.
 
     Terminal/process stdout must be redacted on every surface (foreground
-    `terminal` AND background `process(poll/log/wait)`). Env-dump commands get
-    the ENV-assignment pass so opaque tokens (no vendor prefix) are masked;
-    other commands stay on the code_file path to avoid false positives.
+    `terminal` AND background `process(poll/log/wait)`). Env-dump commands
+    and commands that read ``.env`` files get the ENV-assignment pass so
+    opaque tokens (no vendor prefix) are masked; other commands stay on
+    the code_file path to avoid false positives.
     """
 
     def test_is_env_dump_command_detection(self):
@@ -697,6 +698,110 @@ class TestTerminalOutputRedaction:
         assert not is_env_dump_command("")
         assert not is_env_dump_command(None)
 
+    # ── .env file detection (issue #61352 v2) ──
+
+    def test_command_reads_env_file_detection(self):
+        from agent.redact import _command_reads_env_file
+        # Basic detection
+        assert _command_reads_env_file("cat .env")
+        assert _command_reads_env_file("cat .env.local")
+        assert _command_reads_env_file("cat .env.production")
+        assert _command_reads_env_file("cat .envrc")
+        assert _command_reads_env_file("head .env")
+        assert _command_reads_env_file("tail .env")
+        assert _command_reads_env_file("type .env")
+        assert _command_reads_env_file("nl .env")
+        assert _command_reads_env_file("bat .env")
+        # With flags
+        assert _command_reads_env_file("cat -n .env")
+        assert _command_reads_env_file("cat -A .env")
+        # With paths
+        assert _command_reads_env_file("cat ~/.hermes/.env")
+        assert _command_reads_env_file("cat /home/user/project/.env")
+        assert _command_reads_env_file("cat ./config/.env.local")
+        # In a pipeline / sequence
+        assert _command_reads_env_file("cat .env | grep KEY")
+        assert _command_reads_env_file("echo '---' && cat .env")
+        # Windows-style backslash paths
+        assert _command_reads_env_file("cat C:\\Users\\test\\.env")
+
+    def test_command_reads_env_file_excludes_templates(self):
+        from agent.redact import _command_reads_env_file
+        # Templates/examples should NOT trigger
+        assert not _command_reads_env_file("cat .env.example")
+        assert not _command_reads_env_file("cat .env.sample")
+        assert not _command_reads_env_file("cat .env.template")
+        assert not _command_reads_env_file("cat .env.dist")
+
+    def test_command_reads_env_file_rejects_non_env_files(self):
+        from agent.redact import _command_reads_env_file
+        assert not _command_reads_env_file("cat config.py")
+        assert not _command_reads_env_file("cat README.md")
+        assert not _command_reads_env_file("cat .envrc.bak")  # .bak not in list
+        assert not _command_reads_env_file("python app.py")
+        assert not _command_reads_env_file("echo .env")  # echo is not a file-read cmd
+        assert not _command_reads_env_file("")
+        assert not _command_reads_env_file(None)
+
+
+    def test_cat_env_file_masks_opaque_token(self):
+        """cat .env → code_file=False → generic ENV pass redacts opaque keys."""
+        from agent.redact import redact_terminal_output
+        out = (
+            "MISTRAL_API_KEY=abc123opaqueSecretValue\n"
+            "NOUS_API_KEY=xyz789opaqueKey\n"
+            "DEBUG=true\n"
+        )
+        red = redact_terminal_output(out, "cat .env")
+        assert "abc123opaqueSecretValue" not in red
+        assert "xyz789opaqueKey" not in red
+        assert "DEBUG=true" in red  # non-secret key preserved
+
+    def test_cat_env_file_with_flags_masks_opaque_token(self):
+        """cat -n .env → still detected as .env read."""
+        from agent.redact import redact_terminal_output
+        out = "     1\tMISTRAL_API_KEY=abc123opaqueSecretValue\n"
+        red = redact_terminal_output(out, "cat -n .env")
+        assert "abc123opaqueSecretValue" not in red
+
+    def test_cat_env_file_in_pipeline_masks_opaque_token(self):
+        """cat .env | grep KEY → still detected as .env read."""
+        from agent.redact import redact_terminal_output
+        out = "MISTRAL_API_KEY=abc123opaqueSecretValue"
+        red = redact_terminal_output(out, "cat .env | grep MISTRAL")
+        assert "abc123opaqueSecretValue" not in red
+
+    def test_cat_env_example_not_redacted_as_env(self):
+        """cat .env.example → NOT treated as .env read (template file)."""
+        from agent.redact import redact_terminal_output
+        out = "MISTRAL_API_KEY=placeholder_value_here"
+        red = redact_terminal_output(out, "cat .env.example")
+        # Should NOT be redacted by the ENV-assignment pass (code_file=True).
+        # The placeholder value should survive since it has no vendor prefix.
+        assert "placeholder_value_here" in red
+
+    def test_cat_env_local_masks_opaque_token(self):
+        """cat .env.local → detected as .env read."""
+        from agent.redact import redact_terminal_output
+        out = "CUSTOM_API_KEY=opaquecustomkey123456"
+        red = redact_terminal_output(out, "cat .env.local")
+        assert "opaquecustomkey123456" not in red
+
+    def test_cat_env_inline_comment_preserved(self):
+        """Inline comments after env values are preserved (issue #61352 review)."""
+        from agent.redact import redact_terminal_output
+        out = "MISTRAL_API_KEY=abc123secret # used for tests"
+        red = redact_terminal_output(out, "cat .env")
+        assert "abc123secret" not in red
+        assert "MISTRAL_API_KEY=*** # used for tests" in red
+
+    def test_cat_env_export_inline_comment_preserved(self):
+        """export KEY=VALUE # comment — comment preserved."""
+        from agent.redact import redact_terminal_output
+        out = "export MISTRAL_API_KEY=abc123secret # prod key"
+        red = redact_terminal_output(out, "cat .env")
+        assert "abc123secret" not in red
+        assert "export MISTRAL_API_KEY=*** # prod key" in red