diff --git a/apps/web/src/components/files/FileBrowserPanel.browser.test.tsx b/apps/web/src/components/files/FileBrowserPanel.browser.test.tsx
index 7b8a4e32804c..c7456f141c3b 100644
--- a/apps/web/src/components/files/FileBrowserPanel.browser.test.tsx
+++ b/apps/web/src/components/files/FileBrowserPanel.browser.test.tsx
@@ -14,7 +14,15 @@ const entries: readonly ProjectEntry[] = [
   { path: "README.md", kind: "file" },
 ];
 const loadingDirectories: ReadonlySet<string> = new Set();
-const directory = {
+const directory: {
+  entries: readonly ProjectEntry[];
+  load: () => Promise<void>;
+  refresh: () => void;
+  ready: boolean;
+  error: null;
+  isPending: boolean;
+  loadingDirectories: ReadonlySet<string>;
+} = {
   entries,
   load: () => Promise.resolve(),
   refresh: () => {},
@@ -46,6 +54,15 @@ function findTreeRow(path: string): HTMLElement | null {
   return null;
 }
 
+function withDirectoryListing(listing: readonly ProjectEntry[]): Disposable {
+  directory.entries = listing;
+  return {
+    [Symbol.dispose]: () => {
+      directory.entries = entries;
+    },
+  };
+}
+
 describe("FileBrowserPanel", () => {
   it("copies with the pointer and returns to the row after keyboard dismissal", async () => {
     await using _screen = await render(
@@ -118,6 +135,108 @@ describe("FileBrowserPanel", () => {
     await vi.waitFor(() => expect(onOpenFile).toHaveBeenCalledTimes(1));
   });
 
+  it("keeps an expanded folder open when a very large listing rebuilds the tree", async () => {
+    using _listing = withDirectoryListing(entries);
+    const renderPanel = () => (
+      <FileBrowserPanel
+        environmentId={EnvironmentId.make("env-files")}
+        cwd="/repo-large-folder-1"
+        projectName="repo"
+        selectedPath={null}
+        selectedPathRevealId={0}
+        onOpenFile={() => {}}
+        workspaceMutationId={null}
+      />
+    );
+    await using screen = await render(renderPanel());
+    await vi.waitFor(() => expect(findTreeRow("src/")).not.toBeNull());
+    findTreeRow("src/")!.click();
+    await vi.waitFor(() => expect(findTreeRow("src/")!.getAttribute("aria-expanded")).toBe("true"));
+
+    directory.entries = [
+      ...entries,
+      // Out of sort order, because inserting in order hides the cost of each insert.
+      ...Array.from({ length: 2_000 }, (_, index): ProjectEntry => {
+        const name = String((index * 7_919) % 2_000).padStart(4, "0");
+        return { path: `src/generated-${name}`, kind: "directory" };
+      }),
+    ];
+    await screen.rerender(renderPanel());
+
+    await vi.waitFor(() => expect(findTreeRow("src/generated-0000/")).not.toBeNull());
+    expect(findTreeRow("src/")!.getAttribute("aria-expanded")).toBe("true");
+  });
+
+  it("keeps the selected file through a very large listing without reopening it", async () => {
+    const onOpenFile = vi.fn();
+    const renderPanel = () => (
+      <FileBrowserPanel
+        environmentId={EnvironmentId.make("env-files")}
+        cwd="/repo-large-folder-2"
+        projectName="repo"
+        selectedPath="src/aaa.ts"
+        selectedPathRevealId={1}
+        onOpenFile={onOpenFile}
+        workspaceMutationId={null}
+      />
+    );
+    using _listing = withDirectoryListing([...entries, { path: "src/aaa.ts", kind: "file" }]);
+    await using screen = await render(renderPanel());
+    await vi.waitFor(() =>
+      expect(findTreeRow("src/aaa.ts")?.getAttribute("aria-selected")).toBe("true"),
+    );
+
+    directory.entries = [
+      ...directory.entries,
+      ...Array.from({ length: 2_000 }, (_, index): ProjectEntry => {
+        const name = String((index * 7_919) % 2_000).padStart(4, "0");
+        return { path: `src/generated-${name}.ts`, kind: "file" };
+      }),
+    ];
+    await screen.rerender(renderPanel());
+
+    await vi.waitFor(() => expect(findTreeRow("src/generated-0000.ts")).not.toBeNull());
+    expect(findTreeRow("src/aaa.ts")?.getAttribute("aria-selected")).toBe("true");
+    expect(findTreeRow("src/")?.getAttribute("aria-expanded")).toBe("true");
+    expect(onOpenFile).not.toHaveBeenCalled();
+  });
+
+  it("keeps an open search accurate when a very large folder listing arrives", async () => {
+    const renderPanel = () => (
+      <FileBrowserPanel
+        environmentId={EnvironmentId.make("env-files")}
+        cwd="/repo-large-folder-3"
+        projectName="repo"
+        selectedPath={null}
+        selectedPathRevealId={0}
+        onOpenFile={() => {}}
+        workspaceMutationId={null}
+      />
+    );
+    using _listing = withDirectoryListing([
+      ...entries,
+      { path: "lib", kind: "directory" },
+      { path: "lib/generated-existing.ts", kind: "file" },
+    ]);
+    await using screen = await render(renderPanel());
+    const search = page.getByRole("searchbox", { name: "Search repo files" });
+    await userEvent.fill(search, "generated-");
+    await vi.waitFor(() => expect(findTreeRow("lib/generated-existing.ts")).not.toBeNull());
+
+    directory.entries = [
+      ...directory.entries,
+      ...Array.from({ length: 2_000 }, (_, index): ProjectEntry => {
+        const name = String((index * 7_919) % 2_000).padStart(4, "0");
+        return { path: `src/generated-${name}.ts`, kind: "file" };
+      }),
+    ];
+    await screen.rerender(renderPanel());
+
+    await vi.waitFor(() => expect(findTreeRow("src/generated-0000.ts")).not.toBeNull());
+    expect(findTreeRow("lib/generated-existing.ts")).not.toBeNull();
+    await expect.element(search).toHaveValue("generated-");
+  });
+
   it("mod+f from a tree row, or the panel find command, focuses the file search", async () => {
     await using _screen = await render(
       <FileBrowserPanel
diff --git a/apps/web/src/components/files/FileBrowserPanel.tsx b/apps/web/src/components/files/FileBrowserPanel.tsx
index 4e79632dc72a..24912502fc35 100644
--- a/apps/web/src/components/files/FileBrowserPanel.tsx
+++ b/apps/web/src/components/files/FileBrowserPanel.tsx
@@ -35,7 +35,7 @@ import {
   setAllDirectoriesExpanded,
   writeExpandedDirectories,
 } from "./fileTreeExpansion";
-import { buildFileTreePathUpdates } from "./fileTreePathReconciliation";
+import { buildFileTreePathUpdates, shouldRebuildFileTree } from "./fileTreePathReconciliation";
 import { loadFileAncestors } from "./loadFileAncestors";
 import { useDirectoryEntries } from "./useDirectoryEntries";
 import { useProjectPathSearch } from "~/state/queries";
@@ -438,6 +438,14 @@ export default function FileBrowserPanel({
       return;
     }
     const updates = buildFileTreePathUpdates(previousTreePaths, treePaths);
+    if (shouldRebuildFileTree(previousTreePaths, treePaths, updates)) {
+      // A reset keeps old search matches, so search closes first and recomputes afterwards.
+      const activeSearch = model.isSearchOpen() ? model.getSearchValue() : null;
+      if (activeSearch !== null) model.closeSearch();
+      model.resetPaths(treePaths, { initialExpandedPaths: [...expandedPathsRef.current] });
+      if (activeSearch !== null) model.setSearch(activeSearch);
+      return;
+    }
     if (updates.length > 0) model.batch(updates);
   }, [ready, entryKinds, model, treePaths]);
 
diff --git a/apps/web/src/components/files/fileTreePathReconciliation.test.ts b/apps/web/src/components/files/fileTreePathReconciliation.test.ts
new file mode 100644
index 000000000000..9e532b43fba9
--- /dev/null
+++ b/apps/web/src/components/files/fileTreePathReconciliation.test.ts
@@ -0,0 +1,54 @@
+import { describe, expect, it } from "vite-plus/test";
+
+import { buildFileTreePathUpdates, shouldRebuildFileTree } from "./fileTreePathReconciliation";
+
+const folder = (name: string, count: number) =>
+  Array.from({ length: count }, (_, index) => `${name}/entry-${index}`);
+
+const decide = (previous: readonly string[], next: readonly string[]) =>
+  shouldRebuildFileTree(previous, next, buildFileTreePathUpdates(previous, next));
+
+describe("buildFileTreePathUpdates", () => {
+  it("removes a folder once and skips the paths inside it", () => {
+    expect(
+      buildFileTreePathUpdates(["src/", "src/a/", "src/a/b/", "src/a/c.ts"], ["src/"]),
+    ).toEqual([{ type: "remove", path: "src/a/", recursive: true }]);
+  });
+
+  it("does not treat a sibling that shares a name prefix as inside a removed folder", () => {
+    expect(buildFileTreePathUpdates(["src/a/", "src/ab/", "src/a.ts"], [])).toEqual([
+      { type: "remove", path: "src/a/", recursive: true },
+      { type: "remove", path: "src/ab/", recursive: true },
+      { type: "remove", path: "src/a.ts" },
+    ]);
+  });
+});
+
+describe("shouldRebuildFileTree", () => {
+  it("rebuilds when many paths land in a folder that dominates the tree", () => {
+    const existing = folder("big", 50_000);
+    expect(decide(existing, [...existing, ...addTo("big", 301)])).toBe(true);
+  });
+
+  it("counts a folder's subfolders as siblings, whose paths end in a slash", () => {
+    const existing = folder("big", 50_000).map((path) => `${path}/`);
+    const added = addTo("big", 301).map((path) => `${path}/`);
+    expect(decide(existing, [...existing, ...added])).toBe(true);
+    expect(decide(existing, existing.slice(301))).toBe(true);
+  });
+
+  it("batches a few hundred paths into a small folder beside a large unrelated one", () => {
+    const existing = folder("big", 50_000);
+    expect(decide(existing, [...existing, ...folder("small", 301)])).toBe(false);
+  });
+
+  it("batches many operations spread thinly across many small folders", () => {
+    const existing = folder("big", 50_000);
+    const added = Array.from({ length: 1_000 }, (_, index) => `small-${index}/file.ts`);
+    expect(decide(existing, [...existing, ...added])).toBe(false);
+  });
+});
+
+function addTo(name: string, count: number) {
+  return Array.from({ length: count }, (_, index) => `${name}/added-${index}`);
+}
diff --git a/apps/web/src/components/files/fileTreePathReconciliation.ts b/apps/web/src/components/files/fileTreePathReconciliation.ts
index 5bcccb2cd2a1..b57dfd013b8d 100644
--- a/apps/web/src/components/files/fileTreePathReconciliation.ts
+++ b/apps/web/src/components/files/fileTreePathReconciliation.ts
@@ -1,26 +1,70 @@
 import type { FileTreeBatchOperation } from "@pierre/trees";
 
+// A batched operation reworks its folder's siblings, while a rebuild reworks every path. On flat
+// folders of 50,000 and 332,000 entries a rebuild won somewhere between 200 and 500 operations.
+const REBUILD_COST_IN_FOLDER_OPERATIONS = 300;
+
+function parentOf(path: string): string {
+  const end = path.endsWith("/") ? path.length - 1 : path.length;
+  return path.slice(0, Math.max(0, path.lastIndexOf("/", end - 1)));
+}
+
+function countByParent(paths: readonly string[]): Map<string, number> {
+  const counts = new Map<string, number>();
+  for (const path of paths) {
+    const parent = parentOf(path);
+    counts.set(parent, (counts.get(parent) ?? 0) + 1);
+  }
+  return counts;
+}
+
+export function shouldRebuildFileTree(
+  previousPaths: readonly string[],
+  nextPaths: readonly string[],
+  updates: readonly FileTreeBatchOperation[],
+): boolean {
+  // Up to this many operations, the estimate below can't exceed the rebuild, so skip counting.
+  if (updates.length <= REBUILD_COST_IN_FOLDER_OPERATIONS) return false;
+  const previousCounts = countByParent(previousPaths);
+  const nextCounts = countByParent(nextPaths);
+  let batchWork = 0;
+  for (const update of updates) {
+    if (update.type !== "add" && update.type !== "remove") continue;
+    const parent = parentOf(update.path);
+    batchWork += Math.max(previousCounts.get(parent) ?? 0, nextCounts.get(parent) ?? 0);
+  }
+  const rebuildWork = Math.max(previousPaths.length, nextPaths.length);
+  return batchWork > REBUILD_COST_IN_FOLDER_OPERATIONS * rebuildWork;
+}
+
 function pathDepth(path: string): number {
   return path.split("/").filter(Boolean).length;
 }
 
+function isInsideRemovedDirectory(path: string, removedRoots: ReadonlySet<string>): boolean {
+  for (let slash = path.indexOf("/"); slash !== -1; slash = path.indexOf("/", slash + 1)) {
+    if (removedRoots.has(path.slice(0, slash + 1))) return true;
+  }
+  return false;
+}
+
 export function buildFileTreePathUpdates(
   previousPaths: readonly string[],
   nextPaths: readonly string[],
 ): FileTreeBatchOperation[] {
   const previous = new Set(previousPaths);
   const next = new Set(nextPaths);
-  const removedDirectoryRoots: string[] = [];
+  const removedDirectoryRoots = new Set<string>();
   const updates: FileTreeBatchOperation[] = [];
 
   const removedPaths = previousPaths
     .filter((path) => !next.has(path))
     .toSorted((left, right) => pathDepth(left) - pathDepth(right));
   for (const path of removedPaths) {
-    if (removedDirectoryRoots.some((directory) => path.startsWith(directory))) continue;
+    if (isInsideRemovedDirectory(path, removedDirectoryRoots)) continue;
     const recursive = path.endsWith("/");
     updates.push({ type: "remove", path, ...(recursive ? { recursive: true } : {}) });
-    if (recursive) removedDirectoryRoots.push(path);
+    if (recursive) removedDirectoryRoots.add(path);
   }
 
   const addedPaths = nextPaths