diff --git a/nanobot/agent/memory.py b/nanobot/agent/memory.py
index 779a24a27..e23a4c286 100644
--- a/nanobot/agent/memory.py
+++ b/nanobot/agent/memory.py
@@ -62,10 +62,6 @@ class MemoryStore:
     # Deliberately excludes memory/.dream_cursor so progress bookkeeping never
     # appears as a durable-memory edit in the audit record.
     _DREAM_CONTENT_PATHS = ("SOUL.md", "USER.md", "memory/MEMORY.md")
-    # Per-file cap when embedding current contents into the Dream prompt. The
-    # durable files are tiny in practice (~5 KB total), but a runaway file must
-    # not unbounded the prompt.
-    _DREAM_FILE_EMBED_CAP = 8000
     _LEGACY_ENTRY_START_RE = re.compile(r"^\[(\d{4}-\d{2}-\d{2}[^\]]*)\]\s*")
     _LEGACY_TIMESTAMP_RE = re.compile(r"^\[(\d{4}-\d{2}-\d{2} \d{2}:\d{2})\]\s*")
     _LEGACY_RAW_MESSAGE_RE = re.compile(
@@ -549,9 +545,7 @@ class MemoryStore:
         Returns ``(prompt, last_cursor)`` or ``None`` if nothing to process.
 
         The current contents of the durable memory files (SOUL.md, USER.md,
-        memory/MEMORY.md) are embedded so the model edits the real files rather
-        than a stale mental model — eliminating a class of failed/out-of-bounds
-        edits that previously produced hallucinated audit records.
+        memory/MEMORY.md) reach Dream through the normal agent system context.
         """
         last_cursor = self.get_last_dream_cursor()
         entries = self.read_unprocessed_history(since_cursor=last_cursor)
@@ -564,35 +558,9 @@ class MemoryStore:
             for e in batch
         )
         template = self._dream_template()
-        files_section = self._render_current_memory_files()
-        prompt = (
-            f"{template}\n\n{files_section}\n\n"
-            f"## Conversation History\n{history_text}"
-        )
+        prompt = f"{template}\n\n## Conversation History\n{history_text}"
         return (prompt, batch[-1]["cursor"])
 
-    def _render_current_memory_files(self) -> str:
-        """Render the durable memory files' current contents for the Dream prompt.
-
-        Missing files render as ``(empty)``; oversized files are capped. The
-        section is the ground truth the model must edit against.
-        """
-        files = [
-            ("SOUL.md", self.soul_file),
-            ("USER.md", self.user_file),
-            ("memory/MEMORY.md", self.memory_file),
-        ]
-        blocks: list[str] = []
-        for label, path in files:
-            try:
-                content = path.read_text(encoding="utf-8") if path.exists() else ""
-            except OSError:
-                content = ""
-            if len(content) > self._DREAM_FILE_EMBED_CAP:
-                content = truncate_text(content, self._DREAM_FILE_EMBED_CAP) + "\n...[truncated]"
-            blocks.append(f"### {label}\n{content}" if content.strip() else f"### {label}\n(empty)")
-        return "## Current Memory Files\n" + "\n\n".join(blocks)
-
     def dream_content_diff(self) -> str:
         """Structured summary of uncommitted changes to the durable memory files.
 
diff --git a/nanobot/templates/agent/dream.md b/nanobot/templates/agent/dream.md
index 37a3822c7..341bb0e72 100644
--- a/nanobot/templates/agent/dream.md
+++ b/nanobot/templates/agent/dream.md
@@ -99,7 +99,7 @@ For [SKILL] entries:
 - Skills are instruction sets with concrete values, commands, and examples. MEMORY.md keeps strategic context and high-level facts only.
 
 ## Editing
-- Current contents of SOUL.md, USER.md, and memory/MEMORY.md are embedded in this prompt under "Current Memory Files". Edit those files directly; do not rely on a remembered version of a file.
+- Current contents of SOUL.md, USER.md, and memory/MEMORY.md are provided by the agent system context. Edit those files directly; do not rely on a remembered version of a file.
 - Batch changes into as few calls as possible. Surgical edits only.
 
 ## Verification
diff --git a/tests/agent/test_dream.py b/tests/agent/test_dream.py
index 4c1378184..15f1080ee 100644
--- a/tests/agent/test_dream.py
+++ b/tests/agent/test_dream.py
@@ -62,28 +62,14 @@ class TestBuildDreamPrompt:
         prompt, _ = result
         assert "skill-creator" in prompt
 
-    def test_prompt_embeds_current_memory_file_contents(self, store):
-        """Dream must see the real current file contents (Tier 4) so it edits the
-        files, not a stale mental model."""
+    def test_prompt_does_not_duplicate_current_memory_file_contents(self, store):
         store.append_history("hello")
         result = store.build_dream_prompt()
         assert result is not None
         prompt, _ = result
-        assert "## Current Memory Files" in prompt
-        assert "### SOUL.md" in prompt
-        assert "### USER.md" in prompt
-        assert "### memory/MEMORY.md" in prompt
-        # Real current contents are embedded verbatim.
-        assert "Project X active" in prompt
-        assert "Helpful" in prompt
-
-    def test_prompt_renders_missing_files_as_empty(self, tmp_path):
-        store = MemoryStore(tmp_path)  # no durable files written
-        store.append_history("hello")
-        result = store.build_dream_prompt()
-        assert result is not None
-        prompt, _ = result
-        assert "(empty)" in prompt
+        assert "## Current Memory Files" not in prompt
+        assert "Project X active" not in prompt
+        assert "Helpful" not in prompt
 
     def test_workspace_dream_prompt_overrides_default(self, store):
         store.dream_prompt_file.parent.mkdir(parents=True)
@@ -625,6 +611,63 @@ class TestEphemeralDirect:
         assert "entry-21" not in request_text
         assert "entry-60" not in request_text
 
+    async def test_dream_turn_injects_memory_files_once_and_persists_session(self, tmp_path):
+        """Dream gets durable files from system context without losing its session record."""
+        from unittest.mock import MagicMock
+
+        from nanobot.agent.loop import AgentLoop
+        from nanobot.bus.queue import MessageBus
+
+        markers = {
+            "SOUL.md": "DREAM_SOUL_MARKER",
+            "USER.md": "DREAM_USER_MARKER",
+            "memory/MEMORY.md": "DREAM_MEMORY_MARKER",
+        }
+        store = MemoryStore(tmp_path)
+        store.write_soul(markers["SOUL.md"])
+        store.write_user(markers["USER.md"])
+        store.write_memory(markers["memory/MEMORY.md"])
+        store.append_history("history-marker")
+        (tmp_path / "AGENTS.md").write_text("DREAM_AGENTS_MARKER", encoding="utf-8")
+
+        result = store.build_dream_prompt()
+        assert result is not None
+        prompt, _ = result
+
+        captured: dict[str, list[dict]] = {}
+        provider = MagicMock()
+        provider.get_default_model.return_value = "test-model"
+        provider.supports_tools = True
+        provider.generation = MagicMock(max_tokens=4096)
+
+        async def chat_with_retry(**kwargs):
+            captured["messages"] = kwargs["messages"]
+            return LLMResponse(content="done", finish_reason="stop")
+
+        provider.chat_with_retry = chat_with_retry
+        loop = AgentLoop(
+            bus=MessageBus(),
+            provider=provider,
+            workspace=tmp_path,
+            context_window_tokens=32_000,
+        )
+        session_key = "dream:single-memory-copy"
+
+        await loop.process_direct(
+            prompt,
+            session_key=session_key,
+            ephemeral=True,
+            tools=store.build_dream_tools(),
+        )
+
+        messages = captured["messages"]
+        system_prompt = str(messages[0]["content"])
+        request_text = "\n".join(str(message.get("content", "")) for message in messages)
+        for marker in [*markers.values(), "DREAM_AGENTS_MARKER"]:
+            assert marker in system_prompt
+            assert request_text.count(marker) == 1
+        assert loop.sessions._get_session_path(session_key).exists()
+
 
 class TestEphemeralHooks:
     """When ephemeral=True, extra hooks must not fire."""