diff --git a/packages/coding-agent/CHANGELOG.md b/packages/coding-agent/CHANGELOG.md
index 0973868c..15ad8f55 100644
--- a/packages/coding-agent/CHANGELOG.md
+++ b/packages/coding-agent/CHANGELOG.md
@@ -5,6 +5,7 @@
 ### Fixed
 
 - Bash output expanded hint now says "(ctrl+o to collapse)" ([#610](https://github.com/badlogic/pi-mono/pull/610) by [@tallshort](https://github.com/tallshort))
+- Fixed UTF-8 text corruption in remote bash execution (SSH, containers) by using streaming TextDecoder ([#608](https://github.com/badlogic/pi-mono/issues/608))
 
 ## [0.42.3] - 2026-01-10
 
diff --git a/packages/coding-agent/src/core/bash-executor.ts b/packages/coding-agent/src/core/bash-executor.ts
index 12da78b1..5db79685 100644
--- a/packages/coding-agent/src/core/bash-executor.ts
+++ b/packages/coding-agent/src/core/bash-executor.ts
@@ -197,11 +197,13 @@ export async function executeBashWithOperations(
 	let tempFileStream: WriteStream | undefined;
 	let totalBytes = 0;
 
+	const decoder = new TextDecoder();
+
 	const onData = (data: Buffer) => {
 		totalBytes += data.length;
 
 		// Sanitize: strip ANSI, replace binary garbage, normalize newlines
-		const text = sanitizeBinaryOutput(stripAnsi(data.toString("utf-8"))).replace(/\r/g, "");
+		const text = sanitizeBinaryOutput(stripAnsi(decoder.decode(data, { stream: true }))).replace(/\r/g, "");
 
 		// Start writing to temp file if exceeds threshold
 		if (totalBytes > DEFAULT_MAX_BYTES && !tempFilePath) {