diff --git a/AGENTS.md b/AGENTS.md
index 17679b1..85aed7e 100644
--- a/AGENTS.md
+++ b/AGENTS.md
@@ -36,6 +36,8 @@ This repository owns the published `@elydora/sdk` package, its `elydora` CLI, lo
 - Propagate unexpected errors to the CLI boundary.
 - Use documented defaults only for genuinely optional configuration.
 - Avoid compatibility shims without a named public or user configuration contract.
+- Keep private keys and API tokens out of process arguments and generated setup commands. Accept them through hidden terminal input or owner-only credential files.
+- Persist credential-bearing files through owner-only same-directory temporary files and atomic rename.
 
 ## Verification
 
diff --git a/README.md b/README.md
index 252c5e0..4e60b4e 100644
--- a/README.md
+++ b/README.md
@@ -48,10 +48,11 @@ npx elydora install \
   --agent claudecode \
   --org_id org-123 \
   --agent_id agent-456 \
-  --private_key <key> \
   --kid agent-456-key-v1
 ```
 
+The CLI reads the private key and optional API token through hidden terminal prompts. For non-interactive installation, store each secret in an owner-only file and pass `--private_key_file <path>` and `--token_file <path>`. Secret values are rejected as command-line arguments because process listings and shell history can expose them.
+
 ### Commands
 
 | Command | Description |
diff --git a/src/cli-secrets.ts b/src/cli-secrets.ts
new file mode 100644
index 0000000..3b7e101
--- /dev/null
+++ b/src/cli-secrets.ts
@@ -0,0 +1,123 @@
+import fsp from 'node:fs/promises';
+import readline from 'node:readline';
+import { Writable } from 'node:stream';
+
+const MAX_SECRET_FILE_BYTES = 64 * 1024;
+
+interface SecretSources {
+  readonly privateKeyFile?: string;
+  readonly tokenFile?: string;
+}
+
+interface SecretTerminal {
+  readonly interactive: boolean;
+  readHidden(prompt: string): Promise<string>;
+}
+
+export interface InstallSecrets {
+  readonly privateKey: string;
+  readonly token?: string;
+}
+
+function parseSingleLineSecret(raw: string, label: string, allowEmpty: boolean): string {
+  const value = raw.endsWith('\r\n')
+    ? raw.slice(0, -2)
+    : raw.endsWith('\n')
+      ? raw.slice(0, -1)
+      : raw;
+
+  if (!allowEmpty && value.length === 0) {
+    throw new Error(`${label} is empty`);
+  }
+  if (value.includes('\r') || value.includes('\n') || value.includes('\0')) {
+    throw new Error(`${label} must contain exactly one line`);
+  }
+  return value;
+}
+
+async function readSecretFile(filePath: string, label: string): Promise<string> {
+  const stats = await fsp.lstat(filePath);
+  if (!stats.isFile()) {
+    throw new Error(`${label} file is not a regular file: ${filePath}`);
+  }
+  if (stats.size > MAX_SECRET_FILE_BYTES) {
+    throw new Error(`${label} file exceeds ${MAX_SECRET_FILE_BYTES} bytes: ${filePath}`);
+  }
+  if (process.platform !== 'win32' && (stats.mode & 0o077) !== 0) {
+    throw new Error(`${label} file must be accessible only by its owner: ${filePath}`);
+  }
+
+  const raw = await fsp.readFile(filePath, 'utf-8');
+  return parseSingleLineSecret(raw, label, false);
+}
+
+async function readHidden(prompt: string): Promise<string> {
+  if (!process.stdin.isTTY || !process.stderr.isTTY) {
+    throw new Error('hidden input requires an interactive terminal');
+  }
+
+  let muted = false;
+  const output = new Writable({
+    write(chunk, encoding, callback) {
+      if (!muted) process.stderr.write(chunk, encoding);
+      callback();
+    },
+  });
+  const terminal = readline.createInterface({
+    input: process.stdin,
+    output,
+    terminal: true,
+    historySize: 0,
+  });
+
+  process.stderr.write(prompt);
+  muted = true;
+  try {
+    return await new Promise<string>((resolve, reject) => {
+      terminal.once('SIGINT', () => reject(new Error('secret input cancelled')));
+      terminal.question('', resolve);
+    });
+  } finally {
+    muted = false;
+    terminal.close();
+    process.stderr.write('\n');
+  }
+}
+
+const defaultTerminal: SecretTerminal = {
+  interactive: Boolean(process.stdin.isTTY && process.stderr.isTTY),
+  readHidden,
+};
+
+export async function resolveInstallSecrets(
+  sources: SecretSources,
+  terminal: SecretTerminal = defaultTerminal,
+): Promise<InstallSecrets> {
+  let privateKey: string;
+  if (sources.privateKeyFile) {
+    privateKey = await readSecretFile(sources.privateKeyFile, 'private key');
+  } else if (terminal.interactive) {
+    privateKey = parseSingleLineSecret(
+      await terminal.readHidden('Private key: '),
+      'private key',
+      false,
+    );
+  } else {
+    throw new Error(
+      'private key input requires an interactive terminal or --private_key_file <path>',
+    );
+  }
+
+  let token: string | undefined;
+  if (sources.tokenFile) {
+    token = await readSecretFile(sources.tokenFile, 'API token');
+  } else if (terminal.interactive) {
+    token = parseSingleLineSecret(
+      await terminal.readHidden('API token (optional): '),
+      'API token',
+      true,
+    ) || undefined;
+  }
+
+  return { privateKey, token };
+}
diff --git a/src/cli.ts b/src/cli.ts
index c8a52f6..f1d48cf 100644
--- a/src/cli.ts
+++ b/src/cli.ts
@@ -2,7 +2,9 @@ import { parseArgs } from 'node:util';
 import fsp from 'node:fs/promises';
 import path from 'node:path';
 import os from 'node:os';
+import { resolveInstallSecrets } from './cli-secrets.js';
 import { derivePublicKey } from './crypto.js';
+import { ensurePrivateDirectory, writePrivateFile } from './secure-files.js';
 import { SUPPORTED_AGENTS } from './plugins/registry.js';
 import type { AgentPlugin, InstallConfig } from './plugins/base.js';
 import { generateHookScript, generateGuardScript } from './plugins/hook-template.js';
@@ -55,7 +57,7 @@ function printUsage(): void {
   console.log(`Elydora CLI — Tamper-evident audit for AI coding agents
 
 Usage:
-  elydora install   --agent <name> --org_id <id> --agent_id <id> --private_key <key> --kid <kid> [--token <token>] [--base_url <url>]
+  elydora install   --agent <name> --org_id <id> --agent_id <id> --kid <kid> [--private_key_file <path>] [--token_file <path>] [--base_url <url>]
   elydora uninstall --agent <name> [--agent_id <id>]
   elydora status
   elydora agents
@@ -81,9 +83,9 @@ async function cmdInstall(args: string[]): Promise<void> {
       agent: { type: 'string' },
       org_id: { type: 'string' },
       agent_id: { type: 'string' },
-      private_key: { type: 'string' },
+      private_key_file: { type: 'string' },
       kid: { type: 'string' },
-      token: { type: 'string' },
+      token_file: { type: 'string' },
       base_url: { type: 'string' },
     },
     strict: true,
@@ -101,13 +103,13 @@ async function cmdInstall(args: string[]): Promise<void> {
   const agentId = values.agent_id;
   if (!agentId) die('--agent_id is required');
 
-  const privateKey = values.private_key;
-  if (!privateKey) die('--private_key is required');
-
   const kid = values.kid;
   if (!kid) die('--kid is required');
 
-  const token = values.token;
+  const { privateKey, token } = await resolveInstallSecrets({
+    privateKeyFile: values.private_key_file,
+    tokenFile: values.token_file,
+  });
   const baseUrl = values.base_url ?? 'https://api.elydora.com';
 
   // Validate private key by deriving public key
@@ -122,7 +124,8 @@ async function cmdInstall(args: string[]): Promise<void> {
 
   // Create ~/.elydora/{agentId}/ directory
   const agentDir = path.join(ELYDORA_DIR, agentId);
-  await fsp.mkdir(agentDir, { recursive: true });
+  await ensurePrivateDirectory(ELYDORA_DIR);
+  await ensurePrivateDirectory(agentDir);
 
   // Write agent config
   const agentConfigPath = path.join(agentDir, 'config.json');
@@ -134,18 +137,12 @@ async function cmdInstall(args: string[]): Promise<void> {
     ...(token ? { token } : {}),
     agent_name: agentName,
   };
-  await fsp.writeFile(agentConfigPath, JSON.stringify(agentConfig, null, 2) + '\n', 'utf-8');
-  if (process.platform !== 'win32') {
-    await fsp.chmod(agentConfigPath, 0o600);
-  }
+  await writePrivateFile(agentConfigPath, JSON.stringify(agentConfig, null, 2) + '\n');
   console.log(`  Agent config: ${agentConfigPath}`);
 
-  // Write private key (chmod 600)
+  // Write private key with owner-restricted access
   const keyPath = path.join(agentDir, 'private.key');
-  await fsp.writeFile(keyPath, privateKey, { encoding: 'utf-8', mode: 0o600 });
-  if (process.platform !== 'win32') {
-    await fsp.chmod(keyPath, 0o600);
-  }
+  await writePrivateFile(keyPath, privateKey);
   console.log(`  Private key:  ${keyPath}`);
 
   // Generate and write hook script (PostToolUse — audit logging)
diff --git a/src/secure-files.ts b/src/secure-files.ts
new file mode 100644
index 0000000..9dc19c6
--- /dev/null
+++ b/src/secure-files.ts
@@ -0,0 +1,48 @@
+import crypto from 'node:crypto';
+import fsp from 'node:fs/promises';
+import path from 'node:path';
+
+function isMissingFile(error: unknown): boolean {
+  return error instanceof Error && 'code' in error && error.code === 'ENOENT';
+}
+
+export async function ensurePrivateDirectory(directory: string): Promise<void> {
+  await fsp.mkdir(directory, { recursive: true, mode: 0o700 });
+  if (process.platform !== 'win32') {
+    await fsp.chmod(directory, 0o700);
+  }
+}
+
+export async function writePrivateFile(filePath: string, contents: string): Promise<void> {
+  const directory = path.dirname(filePath);
+  await ensurePrivateDirectory(directory);
+
+  const temporaryPath = path.join(
+    directory,
+    `.${path.basename(filePath)}.${crypto.randomUUID()}.tmp`,
+  );
+  let committed = false;
+  try {
+    const handle = await fsp.open(temporaryPath, 'wx', 0o600);
+    try {
+      await handle.writeFile(contents, 'utf-8');
+      await handle.sync();
+    } finally {
+      await handle.close();
+    }
+
+    await fsp.rename(temporaryPath, filePath);
+    committed = true;
+    if (process.platform !== 'win32') {
+      await fsp.chmod(filePath, 0o600);
+    }
+  } finally {
+    if (!committed) {
+      try {
+        await fsp.unlink(temporaryPath);
+      } catch (error) {
+        if (!isMissingFile(error)) throw error;
+      }
+    }
+  }
+}
diff --git a/test/cli-security.test.mjs b/test/cli-security.test.mjs
new file mode 100644
index 0000000..897672e
--- /dev/null
+++ b/test/cli-security.test.mjs
@@ -0,0 +1,164 @@
+import assert from 'node:assert/strict';
+import { chmod, mkdtemp, readFile, rm, stat, writeFile } from 'node:fs/promises';
+import os from 'node:os';
+import path from 'node:path';
+import { spawn } from 'node:child_process';
+import test from 'node:test';
+
+import { resolveInstallSecrets } from '../dist/cli-secrets.js';
+
+const PRIVATE_KEY = Buffer.alloc(32, 7).toString('base64url');
+const API_TOKEN = 'ely_test_token';
+
+async function runCli(args, homeDir) {
+  return await new Promise((resolve, reject) => {
+    const child = spawn(process.execPath, [path.resolve('dist/cli.js'), ...args], {
+      env: {
+        ...process.env,
+        HOME: homeDir,
+        USERPROFILE: homeDir,
+      },
+      stdio: ['ignore', 'pipe', 'pipe'],
+    });
+    const stdout = [];
+    const stderr = [];
+    child.stdout.on('data', (chunk) => stdout.push(chunk));
+    child.stderr.on('data', (chunk) => stderr.push(chunk));
+    child.once('error', reject);
+    child.once('close', (code) => resolve({
+      code,
+      stdout: Buffer.concat(stdout).toString('utf-8'),
+      stderr: Buffer.concat(stderr).toString('utf-8'),
+    }));
+  });
+}
+
+test('install secrets resolve from hidden prompts without process arguments', async () => {
+  const answers = [PRIVATE_KEY, API_TOKEN];
+  const prompts = [];
+  const secrets = await resolveInstallSecrets({}, {
+    interactive: true,
+    async readHidden(prompt) {
+      prompts.push(prompt);
+      return answers.shift();
+    },
+  });
+
+  assert.deepEqual(secrets, { privateKey: PRIVATE_KEY, token: API_TOKEN });
+  assert.deepEqual(prompts, ['Private key: ', 'API token (optional): ']);
+});
+
+test('non-interactive install requires a credential file for the private key', async () => {
+  await assert.rejects(
+    resolveInstallSecrets({}, {
+      interactive: false,
+      async readHidden() {
+        throw new Error('unexpected prompt');
+      },
+    }),
+    /--private_key_file <path>/,
+  );
+});
+
+test('credential files contain exactly one secret line', async () => {
+  const homeDir = await mkdtemp(path.join(os.tmpdir(), 'elydora-node-cli-'));
+  const privateKeyFile = path.join(homeDir, 'private-key');
+  try {
+    await writeFile(privateKeyFile, `${PRIVATE_KEY}\nsecond-line\n`, { mode: 0o600 });
+    if (process.platform !== 'win32') await chmod(privateKeyFile, 0o600);
+
+    await assert.rejects(
+      resolveInstallSecrets({ privateKeyFile }, {
+        interactive: false,
+        async readHidden() {
+          throw new Error('unexpected prompt');
+        },
+      }),
+      /private key must contain exactly one line/,
+    );
+  } finally {
+    await rm(homeDir, { recursive: true, force: true });
+  }
+});
+
+test('CLI rejects legacy secret arguments before writing files', async () => {
+  const homeDir = await mkdtemp(path.join(os.tmpdir(), 'elydora-node-cli-'));
+  try {
+    const result = await runCli([
+      'install',
+      '--agent', 'opencode',
+      '--org_id', 'org-1',
+      '--agent_id', 'agent-1',
+      '--kid', 'key-1',
+      '--private_key', PRIVATE_KEY,
+      '--token', API_TOKEN,
+    ], homeDir);
+
+    assert.equal(result.code, 1);
+    assert.match(result.stderr, /Unknown option '--private_key'/);
+    await assert.rejects(stat(path.join(homeDir, '.elydora')), { code: 'ENOENT' });
+  } finally {
+    await rm(homeDir, { recursive: true, force: true });
+  }
+});
+
+test('CLI installs from owner-only files and protects persisted credentials', async () => {
+  const homeDir = await mkdtemp(path.join(os.tmpdir(), 'elydora-node-cli-'));
+  const privateKeyFile = path.join(homeDir, 'private-key');
+  const tokenFile = path.join(homeDir, 'api-token');
+  try {
+    await writeFile(privateKeyFile, `${PRIVATE_KEY}\n`, { mode: 0o600 });
+    await writeFile(tokenFile, `${API_TOKEN}\n`, { mode: 0o600 });
+    if (process.platform !== 'win32') {
+      await chmod(privateKeyFile, 0o600);
+      await chmod(tokenFile, 0o600);
+    }
+
+    const result = await runCli([
+      'install',
+      '--agent', 'opencode',
+      '--org_id', 'org-1',
+      '--agent_id', 'agent-1',
+      '--kid', 'key-1',
+      '--private_key_file', privateKeyFile,
+      '--token_file', tokenFile,
+      '--base_url', 'https://api.example.test',
+    ], homeDir);
+
+    assert.equal(result.code, 0, result.stderr);
+    assert.doesNotMatch(result.stdout + result.stderr, new RegExp(PRIVATE_KEY));
+    assert.doesNotMatch(result.stdout + result.stderr, new RegExp(API_TOKEN));
+
+    const agentDir = path.join(homeDir, '.elydora', 'agent-1');
+    assert.equal(await readFile(path.join(agentDir, 'private.key'), 'utf-8'), PRIVATE_KEY);
+    const config = JSON.parse(await readFile(path.join(agentDir, 'config.json'), 'utf-8'));
+    assert.equal(config.token, API_TOKEN);
+
+    const rotatedToken = `${API_TOKEN}_rotated`;
+    await writeFile(tokenFile, `${rotatedToken}\n`);
+    const reinstall = await runCli([
+      'install',
+      '--agent', 'opencode',
+      '--org_id', 'org-1',
+      '--agent_id', 'agent-1',
+      '--kid', 'key-1',
+      '--private_key_file', privateKeyFile,
+      '--token_file', tokenFile,
+      '--base_url', 'https://api.example.test',
+    ], homeDir);
+    assert.equal(reinstall.code, 0, reinstall.stderr);
+    assert.doesNotMatch(reinstall.stdout + reinstall.stderr, new RegExp(rotatedToken));
+    const rotatedConfig = JSON.parse(
+      await readFile(path.join(agentDir, 'config.json'), 'utf-8'),
+    );
+    assert.equal(rotatedConfig.token, rotatedToken);
+
+    if (process.platform !== 'win32') {
+      assert.equal((await stat(agentDir)).mode & 0o777, 0o700);
+      assert.equal((await stat(path.join(agentDir, 'private.key'))).mode & 0o777, 0o600);
+      assert.equal((await stat(path.join(agentDir, 'config.json'))).mode & 0o777, 0o600);
+    }
+  } finally {
+    await rm(homeDir, { recursive: true, force: true });
+  }
+});