diff --git a/apps/web/src/components/Sidebar.tsx b/apps/web/src/components/Sidebar.tsx
index 1b43eb4c1..0fc1065c4 100644
--- a/apps/web/src/components/Sidebar.tsx
+++ b/apps/web/src/components/Sidebar.tsx
@@ -4,11 +4,9 @@ import {
   FolderIcon,
   GitPullRequestIcon,
   PlusIcon,
-  RocketIcon,
   SettingsIcon,
   SquarePenIcon,
   TerminalIcon,
-  TriangleAlertIcon,
 } from "lucide-react";
 import { useCallback, useEffect, useMemo, useRef, useState, type MouseEvent } from "react";
 import {
@@ -28,7 +26,6 @@ import { restrictToParentElement, restrictToVerticalAxis } from "@dnd-kit/modifi
 import { CSS } from "@dnd-kit/utilities";
 import {
   DEFAULT_MODEL_BY_PROVIDER,
-  type DesktopUpdateState,
   ProjectId,
   ThreadId,
   type GitStatusResult,
@@ -50,19 +47,6 @@ import { useComposerDraftStore } from "../composerDraftStore";
 import { useHandleNewThread } from "../hooks/useHandleNewThread";
 import { selectThreadTerminalState, useTerminalStateStore } from "../terminalStateStore";
 import { toastManager } from "./ui/toast";
-import {
-  getArm64IntelBuildWarningDescription,
-  getDesktopUpdateActionError,
-  getDesktopUpdateButtonTooltip,
-  isDesktopUpdateButtonDisabled,
-  resolveDesktopUpdateButtonAction,
-  shouldShowArm64IntelBuildWarning,
-  shouldHighlightDesktopUpdateError,
-  shouldShowDesktopUpdateButton,
-  shouldToastDesktopUpdateActionResult,
-} from "./desktopUpdate.logic";
-import { Alert, AlertAction, AlertDescription, AlertTitle } from "./ui/alert";
-import { Button } from "./ui/button";
 import { Collapsible, CollapsibleContent } from "./ui/collapsible";
 import { Tooltip, TooltipPopup, TooltipTrigger } from "./ui/tooltip";
 import {
@@ -89,6 +73,7 @@ import {
   resolveThreadStatusPill,
   shouldClearThreadSelectionOnMouseDown,
 } from "./Sidebar.logic";
+import { SidebarUpdatePill } from "./sidebar/SidebarUpdatePill";
 import { useCopyToClipboard } from "~/hooks/useCopyToClipboard";
 
 const EMPTY_KEYBINDINGS: ResolvedKeybindingsConfig = [];
@@ -298,7 +283,6 @@ export default function Sidebar() {
   const renamingInputRef = useRef<HTMLInputElement | null>(null);
   const dragInProgressRef = useRef(false);
   const suppressProjectClickAfterDragRef = useRef(false);
-  const [desktopUpdateState, setDesktopUpdateState] = useState<DesktopUpdateState | null>(null);
   const selectedThreadIds = useThreadSelectionStore((s) => s.selectedThreadIds);
   const toggleThreadSelection = useThreadSelectionStore((s) => s.toggleThread);
   const rangeSelectTo = useThreadSelectionStore((s) => s.rangeSelectTo);
@@ -963,66 +947,6 @@ export default function Sidebar() {
     };
   }, [clearSelection, selectedThreadIds.size]);
 
-  useEffect(() => {
-    if (!isElectron) return;
-    const bridge = window.desktopBridge;
-    if (
-      !bridge ||
-      typeof bridge.getUpdateState !== "function" ||
-      typeof bridge.onUpdateState !== "function"
-    ) {
-      return;
-    }
-
-    let disposed = false;
-    let receivedSubscriptionUpdate = false;
-    const unsubscribe = bridge.onUpdateState((nextState) => {
-      if (disposed) return;
-      receivedSubscriptionUpdate = true;
-      setDesktopUpdateState(nextState);
-    });
-
-    void bridge
-      .getUpdateState()
-      .then((nextState) => {
-        if (disposed || receivedSubscriptionUpdate) return;
-        setDesktopUpdateState(nextState);
-      })
-      .catch(() => undefined);
-
-    return () => {
-      disposed = true;
-      unsubscribe();
-    };
-  }, []);
-
-  const showDesktopUpdateButton = isElectron && shouldShowDesktopUpdateButton(desktopUpdateState);
-
-  const desktopUpdateTooltip = desktopUpdateState
-    ? getDesktopUpdateButtonTooltip(desktopUpdateState)
-    : "Update available";
-
-  const desktopUpdateButtonDisabled = isDesktopUpdateButtonDisabled(desktopUpdateState);
-  const desktopUpdateButtonAction = desktopUpdateState
-    ? resolveDesktopUpdateButtonAction(desktopUpdateState)
-    : "none";
-  const showArm64IntelBuildWarning =
-    isElectron && shouldShowArm64IntelBuildWarning(desktopUpdateState);
-  const arm64IntelBuildWarningDescription =
-    desktopUpdateState && showArm64IntelBuildWarning
-      ? getArm64IntelBuildWarningDescription(desktopUpdateState)
-      : null;
-  const desktopUpdateButtonInteractivityClasses = desktopUpdateButtonDisabled
-    ? "cursor-not-allowed opacity-60"
-    : "hover:bg-accent hover:text-foreground";
-  const desktopUpdateButtonClasses =
-    desktopUpdateState?.status === "downloaded"
-      ? "text-emerald-500"
-      : desktopUpdateState?.status === "downloading"
-        ? "text-sky-400"
-        : shouldHighlightDesktopUpdateError(desktopUpdateState)
-          ? "text-rose-500 animate-pulse"
-          : "text-amber-500 animate-pulse";
   const newThreadShortcutLabel = useMemo(
     () =>
       shortcutLabelForCommand(keybindings, "chat.newLocal") ??
@@ -1030,64 +954,6 @@ export default function Sidebar() {
     [keybindings],
   );
 
-  const handleDesktopUpdateButtonClick = useCallback(() => {
-    const bridge = window.desktopBridge;
-    if (!bridge || !desktopUpdateState) return;
-    if (desktopUpdateButtonDisabled || desktopUpdateButtonAction === "none") return;
-
-    if (desktopUpdateButtonAction === "download") {
-      void bridge
-        .downloadUpdate()
-        .then((result) => {
-          if (result.completed) {
-            toastManager.add({
-              type: "success",
-              title: "Update downloaded",
-              description: "Restart the app from the update button to install it.",
-            });
-          }
-          if (!shouldToastDesktopUpdateActionResult(result)) return;
-          const actionError = getDesktopUpdateActionError(result);
-          if (!actionError) return;
-          toastManager.add({
-            type: "error",
-            title: "Could not download update",
-            description: actionError,
-          });
-        })
-        .catch((error) => {
-          toastManager.add({
-            type: "error",
-            title: "Could not start update download",
-            description: error instanceof Error ? error.message : "An unexpected error occurred.",
-          });
-        });
-      return;
-    }
-
-    if (desktopUpdateButtonAction === "install") {
-      void bridge
-        .installUpdate()
-        .then((result) => {
-          if (!shouldToastDesktopUpdateActionResult(result)) return;
-          const actionError = getDesktopUpdateActionError(result);
-          if (!actionError) return;
-          toastManager.add({
-            type: "error",
-            title: "Could not install update",
-            description: actionError,
-          });
-        })
-        .catch((error) => {
-          toastManager.add({
-            type: "error",
-            title: "Could not install update",
-            description: error instanceof Error ? error.message : "An unexpected error occurred.",
-          });
-        });
-    }
-  }, [desktopUpdateButtonAction, desktopUpdateButtonDisabled, desktopUpdateState]);
-
   const expandThreadListForProject = useCallback((projectId: ProjectId) => {
     setExpandedThreadListsByProject((current) => {
       if (current.has(projectId)) return current;
@@ -1136,25 +1002,6 @@ export default function Sidebar() {
         <>
           <SidebarHeader className="drag-region h-[52px] flex-row items-center gap-2 px-4 py-0 pl-[90px]">
             {wordmark}
-            {showDesktopUpdateButton && (
-              <Tooltip>
-                <TooltipTrigger
-                  render={
-                    <button
-                      type="button"
-                      aria-label={desktopUpdateTooltip}
-                      aria-disabled={desktopUpdateButtonDisabled || undefined}
-                      disabled={desktopUpdateButtonDisabled}
-                      className={`inline-flex size-7 ml-auto mt-1.5 items-center justify-center rounded-md text-muted-foreground transition-colors ${desktopUpdateButtonInteractivityClasses} ${desktopUpdateButtonClasses}`}
-                      onClick={handleDesktopUpdateButtonClick}
-                    >
-                      <RocketIcon className="size-3.5" />
-                    </button>
-                  }
-                />
-                <TooltipPopup side="bottom">{desktopUpdateTooltip}</TooltipPopup>
-              </Tooltip>
-            )}
           </SidebarHeader>
         </>
       ) : (
@@ -1164,29 +1011,6 @@ export default function Sidebar() {
       )}
 
       <SidebarContent className="gap-0">
-        {showArm64IntelBuildWarning && arm64IntelBuildWarningDescription ? (
-          <SidebarGroup className="px-2 pt-2 pb-0">
-            <Alert variant="warning" className="rounded-2xl border-warning/40 bg-warning/8">
-              <TriangleAlertIcon />
-              <AlertTitle>Intel build on Apple Silicon</AlertTitle>
-              <AlertDescription>{arm64IntelBuildWarningDescription}</AlertDescription>
-              {desktopUpdateButtonAction !== "none" ? (
-                <AlertAction>
-                  <Button
-                    size="xs"
-                    variant="outline"
-                    disabled={desktopUpdateButtonDisabled}
-                    onClick={handleDesktopUpdateButtonClick}
-                  >
-                    {desktopUpdateButtonAction === "download"
-                      ? "Download ARM build"
-                      : "Install ARM build"}
-                  </Button>
-                </AlertAction>
-              ) : null}
-            </Alert>
-          </SidebarGroup>
-        ) : null}
         <SidebarGroup className="px-2 py-2">
           <div className="mb-1 flex items-center justify-between px-2">
             <span className="text-[10px] font-medium uppercase tracking-wider text-muted-foreground/60">
@@ -1610,6 +1434,7 @@ export default function Sidebar() {
 
       <SidebarSeparator />
       <SidebarFooter className="p-2">
+        <SidebarUpdatePill />
         <SidebarMenu>
           <SidebarMenuItem>
             {isOnSettings ? (
diff --git a/apps/web/src/components/sidebar/SidebarUpdatePill.tsx b/apps/web/src/components/sidebar/SidebarUpdatePill.tsx
new file mode 100644
index 000000000..3b78f1b06
--- /dev/null
+++ b/apps/web/src/components/sidebar/SidebarUpdatePill.tsx
@@ -0,0 +1,199 @@
+import { DownloadIcon, RotateCwIcon, TriangleAlertIcon, XIcon } from "lucide-react";
+import { useCallback, useEffect, useState } from "react";
+import type { DesktopUpdateState } from "@t3tools/contracts";
+import { isElectron } from "../../env";
+import { toastManager } from "../ui/toast";
+import {
+  getArm64IntelBuildWarningDescription,
+  getDesktopUpdateActionError,
+  getDesktopUpdateButtonTooltip,
+  isDesktopUpdateButtonDisabled,
+  resolveDesktopUpdateButtonAction,
+  shouldShowArm64IntelBuildWarning,
+  shouldShowDesktopUpdateButton,
+  shouldToastDesktopUpdateActionResult,
+} from "../desktopUpdate.logic";
+import { Alert, AlertDescription, AlertTitle } from "../ui/alert";
+import { Tooltip, TooltipPopup, TooltipTrigger } from "../ui/tooltip";
+
+export function SidebarUpdatePill() {
+  const [state, setState] = useState<DesktopUpdateState | null>(null);
+  const [dismissed, setDismissed] = useState(false);
+
+  useEffect(() => {
+    if (!isElectron) return;
+    const bridge = window.desktopBridge;
+    if (
+      !bridge ||
+      typeof bridge.getUpdateState !== "function" ||
+      typeof bridge.onUpdateState !== "function"
+    ) {
+      return;
+    }
+
+    let disposed = false;
+    let receivedSubscriptionUpdate = false;
+    const unsubscribe = bridge.onUpdateState((nextState) => {
+      if (disposed) return;
+      receivedSubscriptionUpdate = true;
+      setState(nextState);
+    });
+
+    void bridge
+      .getUpdateState()
+      .then((nextState) => {
+        if (disposed || receivedSubscriptionUpdate) return;
+        setState(nextState);
+      })
+      .catch(() => undefined);
+
+    return () => {
+      disposed = true;
+      unsubscribe();
+    };
+  }, []);
+
+  const visible = isElectron && shouldShowDesktopUpdateButton(state) && !dismissed;
+  const tooltip = state ? getDesktopUpdateButtonTooltip(state) : "Update available";
+  const disabled = isDesktopUpdateButtonDisabled(state);
+  const action = state ? resolveDesktopUpdateButtonAction(state) : "none";
+
+  const showArm64Warning = isElectron && shouldShowArm64IntelBuildWarning(state);
+  const arm64Description =
+    state && showArm64Warning ? getArm64IntelBuildWarningDescription(state) : null;
+
+  const handleAction = useCallback(() => {
+    const bridge = window.desktopBridge;
+    if (!bridge || !state) return;
+    if (disabled || action === "none") return;
+
+    if (action === "download") {
+      void bridge
+        .downloadUpdate()
+        .then((result) => {
+          if (result.completed) {
+            toastManager.add({
+              type: "success",
+              title: "Update downloaded",
+              description: "Restart the app from the update button to install it.",
+            });
+          }
+          if (!shouldToastDesktopUpdateActionResult(result)) return;
+          const actionError = getDesktopUpdateActionError(result);
+          if (!actionError) return;
+          toastManager.add({
+            type: "error",
+            title: "Could not download update",
+            description: actionError,
+          });
+        })
+        .catch((error) => {
+          toastManager.add({
+            type: "error",
+            title: "Could not start update download",
+            description: error instanceof Error ? error.message : "An unexpected error occurred.",
+          });
+        });
+      return;
+    }
+
+    if (action === "install") {
+      void bridge
+        .installUpdate()
+        .then((result) => {
+          if (!shouldToastDesktopUpdateActionResult(result)) return;
+          const actionError = getDesktopUpdateActionError(result);
+          if (!actionError) return;
+          toastManager.add({
+            type: "error",
+            title: "Could not install update",
+            description: actionError,
+          });
+        })
+        .catch((error) => {
+          toastManager.add({
+            type: "error",
+            title: "Could not install update",
+            description: error instanceof Error ? error.message : "An unexpected error occurred.",
+          });
+        });
+    }
+  }, [action, disabled, state]);
+
+  if (!visible && !showArm64Warning) return null;
+
+  return (
+    <div className="px-1 pb-1 flex flex-col gap-1">
+      {showArm64Warning && arm64Description && (
+        <Alert variant="warning" className="rounded-2xl border-warning/40 bg-warning/8 text-xs">
+          <TriangleAlertIcon />
+          <AlertTitle>Intel build on Apple Silicon</AlertTitle>
+          <AlertDescription>{arm64Description}</AlertDescription>
+        </Alert>
+      )}
+      {visible && (
+        <div
+          className={`group/update relative flex w-full items-center rounded-full text-xs font-medium bg-sky-400/15 text-sky-400${
+            disabled ? " cursor-not-allowed opacity-60" : ""
+          }`}
+        >
+          <div className="absolute inset-0 rounded-full transition-colors group-has-[button.update-main:hover]/update:bg-sky-400/25 pointer-events-none" />
+          <Tooltip>
+            <TooltipTrigger
+              render={
+                <button
+                  type="button"
+                  aria-label={tooltip}
+                  aria-disabled={disabled || undefined}
+                  disabled={disabled}
+                  className="update-main relative flex flex-1 items-center gap-2 px-3 py-1.5"
+                  onClick={handleAction}
+                >
+                  {action === "install" ? (
+                    <>
+                      <RotateCwIcon className="size-3.5" />
+                      <span>Restart to update</span>
+                    </>
+                  ) : state?.status === "downloading" ? (
+                    <>
+                      <DownloadIcon className="size-3.5" />
+                      <span>
+                        Downloading
+                        {typeof state.downloadPercent === "number"
+                          ? ` (${Math.floor(state.downloadPercent)}%)`
+                          : "…"}
+                      </span>
+                    </>
+                  ) : (
+                    <>
+                      <DownloadIcon className="size-3.5" />
+                      <span>Update available</span>
+                    </>
+                  )}
+                </button>
+              }
+            />
+            <TooltipPopup side="top">{tooltip}</TooltipPopup>
+          </Tooltip>
+          {action === "download" && (
+            <Tooltip>
+              <TooltipTrigger
+                render={
+                  <button
+                    type="button"
+                    aria-label="Dismiss update"
+                    className="inline-flex size-6 items-center justify-center rounded-md text-sky-400/60 transition-colors hover:text-sky-400 mr-1"
+                    onClick={() => setDismissed(true)}
+                  >
+                    <XIcon className="size-3.5" />
+                  </button>
+                }
+              />
+              <TooltipPopup side="top">Dismiss until next launch</TooltipPopup>
+            </Tooltip>
+          )}
+        </div>
+      )}
+    </div>
+  );
+}