diff --git a/src/renderer/src/assets/terminal-container-geometry.test.ts b/src/renderer/src/assets/terminal-container-geometry.test.ts
new file mode 100644
index 000000000..db079c909
--- /dev/null
+++ b/src/renderer/src/assets/terminal-container-geometry.test.ts
@@ -0,0 +1,18 @@
+import fs from 'node:fs'
+import { describe, expect, it } from 'vitest'
+
+const terminalCss = fs.readFileSync(new URL('./terminal.css', import.meta.url), 'utf8')
+
+describe('terminal container geometry', () => {
+  it('keeps the hidden link tooltip out of the fitted terminal height', () => {
+    expect(terminalCss).toMatch(
+      /\.xterm-container\s*{[^}]*height:\s*calc\(100% - var\(--pane-padding-y, 4px\)\);/s
+    )
+    expect(terminalCss).toMatch(
+      /\.pane\[data-has-title\] \.xterm-container\s*{[^}]*height:\s*calc\(100% - var\(--orca-pane-title-height\)\);/s
+    )
+    expect(terminalCss).toMatch(
+      /\.pane-link-tooltip\s*{[^}]*height:\s*var\(--orca-terminal-link-tooltip-height\);/s
+    )
+  })
+})
diff --git a/src/renderer/src/assets/terminal.css b/src/renderer/src/assets/terminal.css
index 3d9a5df21..ee5e0af01 100644
--- a/src/renderer/src/assets/terminal.css
+++ b/src/renderer/src/assets/terminal.css
@@ -6,8 +6,7 @@
   position: relative;
 }
 
-/* Why: .pane-manager-root matches no live element, so a var declared there
-   never resolves and every calc() using it is dropped. Keep it on :root. */
+/* Shared tooltip geometry for every terminal link provider. */
 :root {
   --orca-terminal-link-tooltip-height: 25px;
 }
@@ -506,7 +505,7 @@
   box-sizing: border-box;
   position: relative;
   width: calc(100% - var(--pane-padding-x, 4px));
-  height: calc(100% - var(--pane-padding-y, 4px) - var(--orca-terminal-link-tooltip-height, 25px));
+  height: calc(100% - var(--pane-padding-y, 4px));
   margin-top: var(--pane-padding-y, 4px);
   margin-left: var(--pane-padding-x, 4px);
 }
@@ -517,9 +516,7 @@
    same amount to prevent overflow/clipping. */
 .pane[data-has-title] .xterm-container {
   margin-top: var(--orca-pane-title-height);
-  height: calc(
-    100% - var(--orca-pane-title-height) - var(--orca-terminal-link-tooltip-height, 25px)
-  ); /* match margin-top and the tooltip reserve */
+  height: calc(100% - var(--orca-pane-title-height)); /* match margin-top */
 }
 
 /* Ghostty-style URL hover: glued to the pane's true bottom-left corner. */
diff --git a/tests/e2e/issue-12656-terminal-link-tooltip.spec.ts b/tests/e2e/issue-12656-terminal-link-tooltip.spec.ts
index 56c27dc19..74c7971b8 100644
--- a/tests/e2e/issue-12656-terminal-link-tooltip.spec.ts
+++ b/tests/e2e/issue-12656-terminal-link-tooltip.spec.ts
@@ -25,8 +25,8 @@ type TooltipState = {
   paneBottom: number
   terminalBottom: number
   tooltipTop: number
+  tooltipBottom: number
   tooltipHeight: number
-  reserveHeight: number
 }
 
 async function locateUrl(page: Page, url: string): Promise<LinkProbe | null> {
@@ -98,7 +98,6 @@ async function readTooltipState(page: Page, tabId: string): Promise<TooltipState
     const paneRect = pane.container.getBoundingClientRect()
     const terminalRect = pane.terminal.element?.parentElement?.getBoundingClientRect()
     const tooltipRect = pane.linkTooltip.getBoundingClientRect()
-    const reserveHeight = tooltipRect.height
 
     return {
       display: pane.linkTooltip.style.display,
@@ -108,8 +107,8 @@ async function readTooltipState(page: Page, tabId: string): Promise<TooltipState
       paneBottom: paneRect.bottom,
       terminalBottom: terminalRect?.bottom ?? 0,
       tooltipTop: tooltipRect.top,
-      tooltipHeight: tooltipRect.height,
-      reserveHeight
+      tooltipBottom: tooltipRect.bottom,
+      tooltipHeight: tooltipRect.height
     }
   }, tabId)
 }
@@ -119,7 +118,7 @@ async function captureProof(page: Page, testInfo: TestInfo, name: string): Promi
 }
 
 test.describe('Issue #12656 terminal link tooltip', () => {
-  test('clears hover state on window blur and reserves the tooltip strip', async ({
+  test('clears hover state without permanently shrinking the terminal', async ({
     orcaPage
   }, testInfo) => {
     await waitForSessionReady(orcaPage)
@@ -150,6 +149,8 @@ test.describe('Issue #12656 terminal link tooltip', () => {
     if (!probe) {
       throw new Error('URL probe disappeared before hover')
     }
+    const idle = await readTooltipState(orcaPage, probe.tabId)
+    expect(Math.abs(idle.paneBottom - idle.terminalBottom)).toBeLessThanOrEqual(1)
     await expect
       .poll(async () => {
         await moveToLink(orcaPage, probe)
@@ -160,26 +161,19 @@ test.describe('Issue #12656 terminal link tooltip', () => {
     const hovered = await readTooltipState(orcaPage, probe.tabId)
     expect(hovered.text).toContain(url)
     expect(hovered.tooltipHeight).toBeGreaterThan(0)
-    expect(hovered.tooltipTop).toBeGreaterThanOrEqual(hovered.terminalBottom - 1)
-    // Why: bound the gap on both sides. A lower bound alone also passes when the
-    // reserve var fails to resolve and .xterm-container collapses to height:auto,
-    // which leaves a huge gap and an undersized terminal.
-    expect(hovered.paneBottom - hovered.terminalBottom).toBeGreaterThanOrEqual(
-      hovered.reserveHeight - 1
-    )
-    expect(hovered.paneBottom - hovered.terminalBottom).toBeLessThanOrEqual(
-      hovered.reserveHeight + 1
-    )
+    expect(Math.abs(hovered.paneBottom - hovered.terminalBottom)).toBeLessThanOrEqual(1)
+    expect(Math.abs(hovered.paneBottom - hovered.tooltipBottom)).toBeLessThanOrEqual(1)
+    expect(hovered.tooltipTop).toBeLessThan(hovered.terminalBottom)
     await captureProof(orcaPage, testInfo, 'issue-12656-fixed-hover.png')
 
     await orcaPage.evaluate(() => window.dispatchEvent(new Event('blur')))
     await expect
       .poll(() => readTooltipState(orcaPage, probe.tabId))
       .toMatchObject({ display: 'none', currentLinkText: null, cursor: 'text' })
+    const cleared = await readTooltipState(orcaPage, probe.tabId)
+    expect(Math.abs(cleared.paneBottom - cleared.terminalBottom)).toBeLessThanOrEqual(1)
     await captureProof(orcaPage, testInfo, 'issue-12656-fixed-after-blur.png')
 
-    // Keep the output assertion adjacent to the visual state checks so the
-    // reserved strip cannot hide the final terminal line without detection.
     await expect.poll(() => getTerminalContent(orcaPage)).toContain(url)
   })
 })