diff --git a/Cargo.lock b/Cargo.lock
index 3e1e34f..8fe9f11 100644
--- a/Cargo.lock
+++ b/Cargo.lock
@@ -674,6 +674,7 @@ version = "2.0.0"
 dependencies = [
  "anyhow",
  "async-trait",
+ "atty",
  "chrono",
  "dirs",
  "gyandoot-browser",
diff --git a/crates/gyandoot-agent/Cargo.toml b/crates/gyandoot-agent/Cargo.toml
index dc08d14..809248f 100644
--- a/crates/gyandoot-agent/Cargo.toml
+++ b/crates/gyandoot-agent/Cargo.toml
@@ -22,4 +22,5 @@ uuid.workspace = true
 chrono.workspace = true
 async-trait.workspace = true
 rand.workspace = true
-dirs.workspace = true
\ No newline at end of file
+dirs.workspace = true
+atty.workspace = true
\ No newline at end of file
diff --git a/crates/gyandoot-agent/src/agent_loop.rs b/crates/gyandoot-agent/src/agent_loop.rs
index 2cf9252..171c048 100644
--- a/crates/gyandoot-agent/src/agent_loop.rs
+++ b/crates/gyandoot-agent/src/agent_loop.rs
@@ -24,6 +24,18 @@ use tracing::{debug, error, info, span, warn, Level};
 use crate::context::ContextCompressor;
 use crate::tools::ToolExecutor;
 
+// ─── CLI color constants ──────────────────────────────────────────────
+mod cli_color {
+    pub const RESET: &str = "\x1b[0m";
+    pub const BOLD: &str = "\x1b[1m";
+    pub const DIM: &str = "\x1b[2m";
+    pub const CYAN: &str = "\x1b[36m";
+    pub const BRIGHT_CYAN: &str = "\x1b[96m";
+    pub const BRIGHT_MAGENTA: &str = "\x1b[95m";
+    pub const GREEN: &str = "\x1b[32m";
+    pub const YELLOW: &str = "\x1b[33m";
+}
+
 // ─── Error classification ───────────────────────────────────────────────
 
 /// Categories of errors the agent loop can encounter during LLM calls.
@@ -369,7 +381,12 @@ impl AgentLoop {
             .build_context(&messages, &self.config.system_prompt, &self.tool_executor.lock().await.definitions(), self.config.max_tokens);
 
         *self.status.lock().await = AgentStatus::Thinking;
-        let response = self.call_with_retry(context).await?;
+
+        // Show thinking animation while waiting for LLM
+        let spinner_handle = self.start_thinking_indicator();
+        let response = self.call_with_retry(context).await;
+        self.stop_thinking_indicator(spinner_handle).await;
+        let response = response?;
 
         messages.push(Message::new(MessageRole::Assistant, &response.content)
             .with_tool_calls(response.tool_calls.clone().unwrap_or_default()));
@@ -525,9 +542,73 @@ impl AgentLoop {
         )))
     }
 
+    /// Display output to stdout with GyanDoot prefix.
+    fn display_output(&self, output: &str) {
+        println!(
+            "\n{bold}{green}G{reset}> {output}",
+            bold = cli_color::BOLD,
+            green = cli_color::GREEN,
+            reset = cli_color::RESET,
+            output = output,
+        );
+    }
+
+    /// Start the thinking animation (spinner on stderr).
+    /// Returns a handle to stop the animation.
+    fn start_thinking_indicator(&self) -> tokio::sync::watch::Sender<bool> {
+        use std::io::Write;
+        let (tx, mut rx) = tokio::sync::watch::channel(true);
+        let frames = ["⠋", "⠙", "⠹", "⠸", "⠼", "⠴", "⠦", "⠧", "⠇", "⠏"];
+
+        tokio::spawn(async move {
+            let mut frame_idx = 0;
+            let start = std::time::Instant::now();
+            while *rx.borrow_and_update() {
+                let spinner = frames[frame_idx % frames.len()];
+                frame_idx += 1;
+                let elapsed = start.elapsed().as_secs_f64();
+                eprint!(
+                    "\r{magenta}{spinner}{reset} {bold}answering{reset} ({elapsed:.1}s) ",
+                    magenta = cli_color::BRIGHT_MAGENTA,
+                    spinner = spinner,
+                    reset = cli_color::RESET,
+                    bold = cli_color::BOLD,
+                    elapsed = elapsed,
+                );
+                std::io::stderr().flush().ok();
+                tokio::time::sleep(std::time::Duration::from_millis(100)).await;
+            }
+            // Clear the spinner line
+            eprint!("\r\x1b[K");
+            std::io::stderr().flush().ok();
+        });
+
+        tx
+    }
+
+    /// Stop the thinking animation.
+    async fn stop_thinking_indicator(&self, handle: tokio::sync::watch::Sender<bool>) {
+        let _ = handle.send(false);
+        // Small delay for the spinner task to finish and clear the line
+        tokio::time::sleep(std::time::Duration::from_millis(50)).await;
+    }
+
     /// Read a line of input from stdin.
     async fn read_input(&self) -> anyhow::Result<String> {
+        use std::io::Write;
         use tokio::io::AsyncBufReadExt;
+
+        // Show input prompt
+        if atty::is(atty::Stream::Stdin) {
+            print!(
+                "{bold}{cyan}»{reset} ",
+                bold = cli_color::BOLD,
+                cyan = cli_color::BRIGHT_CYAN,
+                reset = cli_color::RESET,
+            );
+            std::io::stdout().flush().ok();
+        }
+
         let mut line = String::new();
         let mut reader = tokio::io::BufReader::new(tokio::io::stdin());
         reader.read_line(&mut line).await?;
@@ -538,11 +619,6 @@ impl AgentLoop {
     fn should_exit(&self, input: &str) -> bool {
         matches!(input.to_lowercase().as_str(), "exit" | "quit" | "bye")
     }
-
-    /// Display output to stdout.
-    fn display_output(&self, output: &str) {
-        println!("\n{}", output);
-    }
 }
 
 /// Calculate exponential backoff with jitter.