diff --git a/.changeset/fn-7252-file-browser-worktree-reload.md b/.changeset/fn-7252-file-browser-worktree-reload.md
new file mode 100644
index 0000000000..9d3649ec96
--- /dev/null
+++ b/.changeset/fn-7252-file-browser-worktree-reload.md
@@ -0,0 +1,7 @@
+---
+"@runfusion/fusion": patch
+---
+
+summary: Reload the selected file when switching Files modal worktrees.
+category: fix
+dev: Keeps Files modal selected-path state while changing workspace/worktree.
diff --git a/packages/dashboard/app/components/FileBrowserModal.tsx b/packages/dashboard/app/components/FileBrowserModal.tsx
index b99be00992..547e29ba22 100644
--- a/packages/dashboard/app/components/FileBrowserModal.tsx
+++ b/packages/dashboard/app/components/FileBrowserModal.tsx
@@ -228,12 +228,27 @@ export function FileBrowserModal({
     setContent(originalContent);
   }, [originalContent, setContent]);
 
+  /*
+  FNXC:FileBrowser 2026-06-29-00:00:
+  Worktree switches must keep the last selected file path so users can recover from a load error caused by viewing the right path in the wrong workspace. The raw browser hook still resets each new workspace to root, so the modal re-points the sidebar to the selected file's parent directory after that reset while mobile keeps the editor pane active.
+  */
+  const previousWorkspaceRef = useRef(currentWorkspace);
+  useEffect(() => {
+    const workspaceChanged = previousWorkspaceRef.current !== currentWorkspace;
+    if (workspaceChanged && selectedFile) {
+      setPath(getParentDirectory(selectedFile));
+      if (isMobile) {
+        setMobileView("editor");
+      }
+    }
+    previousWorkspaceRef.current = currentWorkspace;
+  }, [currentWorkspace, isMobile, selectedFile, setPath]);
+
   const handleWorkspaceSelect = useCallback((workspace: string) => {
     setCurrentWorkspace(workspace);
-    setSelectedFile(null);
-    setMobileView("list");
+    setMobileView(selectedFile ? "editor" : "list");
     onWorkspaceChange?.(workspace);
-  }, [onWorkspaceChange]);
+  }, [onWorkspaceChange, selectedFile]);
 
   const persistSidebarWidth = useCallback((width: number) => {
     try {
diff --git a/packages/dashboard/app/components/__tests__/FileBrowserModal.test.tsx b/packages/dashboard/app/components/__tests__/FileBrowserModal.test.tsx
index c833990b06..6f8f632316 100644
--- a/packages/dashboard/app/components/__tests__/FileBrowserModal.test.tsx
+++ b/packages/dashboard/app/components/__tests__/FileBrowserModal.test.tsx
@@ -230,6 +230,159 @@ describe("FileBrowserModal", () => {
     expect(mockOnWorkspaceChange).toHaveBeenCalledWith("FN-002");
   });
 
+  it("keeps an errored nested selected file open on desktop after switching workspaces", async () => {
+    const user = userEvent.setup();
+    const nestedFile = "packages/dashboard/app/App.tsx";
+    mockUseWorkspaceFileEditor.mockReturnValue({
+      ...defaultEditorState,
+      error: "Could not load App.tsx",
+    });
+
+    render(
+      <FileBrowserModal
+        initialWorkspace="project"
+        initialFile={nestedFile}
+        isOpen={true}
+        onClose={mockOnClose}
+        onWorkspaceChange={mockOnWorkspaceChange}
+      />,
+    );
+
+    await waitFor(() => expect(screen.getByLabelText(`Editor for ${nestedFile}`)).toBeInTheDocument());
+    expect(screen.getByText("Could not load App.tsx")).toBeInTheDocument();
+    mockSetPath.mockClear();
+
+    await user.click(screen.getByRole("button", { name: /kb/i }));
+    await user.click(screen.getByRole("button", { name: /FN-002 Task Two/i }));
+
+    await waitFor(() => {
+      expect(mockUseWorkspaceFileEditor).toHaveBeenLastCalledWith("FN-002", nestedFile, true, undefined);
+    });
+    expect(screen.getByLabelText(`Editor for ${nestedFile}`)).toBeInTheDocument();
+    expect(screen.getByText("Could not load App.tsx")).toBeInTheDocument();
+    expect(document.querySelector(".file-browser-content.mobile")).toBeNull();
+    expect(mockSetPath).toHaveBeenCalledWith("packages/dashboard/app");
+    expect(mockOnWorkspaceChange).toHaveBeenCalledWith("FN-002");
+  });
+
+  it("replaces an errored selected file with newly loaded content after switching workspaces", async () => {
+    const user = userEvent.setup();
+    const nestedFile = "packages/dashboard/app/App.tsx";
+    mockUseWorkspaceFileEditor.mockImplementation((workspace, filePath) => {
+      if (workspace === "FN-002" && filePath === nestedFile) {
+        return {
+          ...defaultEditorState,
+          content: "console.log('loaded from task worktree');",
+          originalContent: "console.log('loaded from task worktree');",
+          error: null,
+        };
+      }
+
+      if (filePath === nestedFile) {
+        return {
+          ...defaultEditorState,
+          content: "",
+          originalContent: "",
+          error: "Could not load App.tsx",
+        };
+      }
+
+      return defaultEditorState;
+    });
+
+    render(
+      <FileBrowserModal
+        initialWorkspace="project"
+        initialFile={nestedFile}
+        isOpen={true}
+        onClose={mockOnClose}
+        onWorkspaceChange={mockOnWorkspaceChange}
+      />,
+    );
+
+    await waitFor(() => expect(screen.getByText("Could not load App.tsx")).toBeInTheDocument());
+    mockSetPath.mockClear();
+
+    await user.click(screen.getByRole("button", { name: /kb/i }));
+    await user.click(screen.getByRole("button", { name: /FN-002 Task Two/i }));
+
+    await waitFor(() => {
+      expect(mockUseWorkspaceFileEditor).toHaveBeenLastCalledWith("FN-002", nestedFile, true, undefined);
+    });
+    expect(screen.queryByText("Could not load App.tsx")).not.toBeInTheDocument();
+    expect(document.querySelector(".cm-content")?.textContent).toContain("console.log('loaded from task worktree');");
+    expect(mockSetPath).toHaveBeenCalledWith("packages/dashboard/app");
+  });
+
+  it("keeps mobile on the errored nested selected file after switching workspaces", async () => {
+    Object.defineProperty(window, "innerWidth", {
+      writable: true,
+      configurable: true,
+      value: 375,
+    });
+    const user = userEvent.setup();
+    const nestedFile = "packages/dashboard/app/App.tsx";
+    mockUseWorkspaceFileEditor.mockReturnValue({
+      ...defaultEditorState,
+      error: "Could not load App.tsx",
+    });
+
+    render(
+      <FileBrowserModal
+        initialWorkspace="project"
+        initialFile={nestedFile}
+        isOpen={true}
+        onClose={mockOnClose}
+        onWorkspaceChange={mockOnWorkspaceChange}
+      />,
+    );
+
+    fireEvent(window, new Event("resize"));
+    await waitFor(() => expect(screen.getByLabelText("Back to file list")).toBeInTheDocument());
+    expect(screen.getByLabelText(`Editor for ${nestedFile}`)).toBeInTheDocument();
+    mockSetPath.mockClear();
+
+    await user.click(screen.getByRole("button", { name: /kb/i }));
+    await user.click(screen.getByRole("button", { name: /FN-002 Task Two/i }));
+
+    await waitFor(() => {
+      expect(mockUseWorkspaceFileEditor).toHaveBeenLastCalledWith("FN-002", nestedFile, true, undefined);
+    });
+    expect(screen.getByLabelText("Back to file list")).toBeInTheDocument();
+    expect(screen.getByLabelText(`Editor for ${nestedFile}`)).toBeInTheDocument();
+    expect(document.querySelector(".file-browser-content.mobile.active")).not.toBeNull();
+    expect(document.querySelector(".file-browser-sidebar.mobile.active")).toBeNull();
+    expect(mockSetPath).toHaveBeenCalledWith("packages/dashboard/app");
+    expect(mockOnWorkspaceChange).toHaveBeenCalledWith("FN-002");
+  });
+
+  it("keeps the placeholder after switching workspaces with no selected file", async () => {
+    const user = userEvent.setup();
+
+    render(
+      <FileBrowserModal
+        initialWorkspace="project"
+        isOpen={true}
+        onClose={mockOnClose}
+        onWorkspaceChange={mockOnWorkspaceChange}
+      />,
+    );
+
+    expect(screen.getByText("Select a file to edit")).toBeInTheDocument();
+    mockUseWorkspaceFileEditor.mockClear();
+
+    await user.click(screen.getByRole("button", { name: /kb/i }));
+    await user.click(screen.getByRole("button", { name: /FN-002 Task Two/i }));
+
+    await waitFor(() => {
+      expect(mockUseWorkspaceFileEditor).toHaveBeenLastCalledWith("FN-002", null, true, undefined);
+    });
+    expect(screen.getByText("Select a file to edit")).toBeInTheDocument();
+    expect(screen.queryByLabelText(/Editor for /)).not.toBeInTheDocument();
+    expect(mockSetPath).not.toHaveBeenCalledWith(expect.stringContaining("packages/dashboard/app"));
+    expect(mockOnWorkspaceChange).toHaveBeenCalledWith("FN-002");
+  });
+
   it("shows back button in mobile editor view", async () => {
     Object.defineProperty(window, "innerWidth", {
       writable: true,
diff --git a/packages/dashboard/app/hooks/useWorkspaceFileBrowser.ts b/packages/dashboard/app/hooks/useWorkspaceFileBrowser.ts
index 58419c165f..062beadfa6 100644
--- a/packages/dashboard/app/hooks/useWorkspaceFileBrowser.ts
+++ b/packages/dashboard/app/hooks/useWorkspaceFileBrowser.ts
@@ -39,6 +39,10 @@ export function useWorkspaceFileBrowser(
     setError(null);
   }, []);
 
+  /*
+  FNXC:FileBrowser 2026-06-29-19:35:
+  Workspace file pickers must start each workspace at root so SettingsModal directory/file pickers do not inherit editor selection state. FileBrowserModal restores its selected file path at the modal layer when it needs editor persistence across worktree switches.
+  */
   useEffect(() => {
     setCurrentPath(".");
     setError(null);