diff --git a/packages/core/src/__tests__/agent-permission-policy.test.ts b/packages/core/src/__tests__/agent-permission-policy.test.ts
index 3c8aa5def..1d949dbcc 100644
--- a/packages/core/src/__tests__/agent-permission-policy.test.ts
+++ b/packages/core/src/__tests__/agent-permission-policy.test.ts
@@ -15,6 +15,7 @@ describe("agent-permission-policy", () => {
       "unrestricted",
       "approval-required",
       "locked-down",
+      "custom",
     ]);
   });
 
@@ -65,6 +66,6 @@ describe("agent-permission-policy", () => {
     expect(isAgentPermissionPolicyPresetId("unrestricted")).toBe(true);
     expect(isAgentPermissionPolicyPresetId("approval-required")).toBe(true);
     expect(isAgentPermissionPolicyPresetId("locked-down")).toBe(true);
-    expect(isAgentPermissionPolicyPresetId("custom")).toBe(false);
+    expect(isAgentPermissionPolicyPresetId("custom")).toBe(true);
   });
 });
diff --git a/packages/core/src/agent-permission-policy.ts b/packages/core/src/agent-permission-policy.ts
index 9b8812271..f362b9602 100644
--- a/packages/core/src/agent-permission-policy.ts
+++ b/packages/core/src/agent-permission-policy.ts
@@ -126,6 +126,10 @@ function normalizeProjectDefaultPolicy(
     merged[category] = nextValue;
   }
 
+  if (Object.keys(merged).length === 0) {
+    return normalizeAgentPermissionPolicyFromPreset(DEFAULT_AGENT_PERMISSION_POLICY_PRESET_ID);
+  }
+
   return normalizeAgentPermissionPolicy({
     presetId: "custom",
     rules: { ...seed, ...merged },
diff --git a/packages/dashboard/src/__tests__/routes-agents.test.ts b/packages/dashboard/src/__tests__/routes-agents.test.ts
index a3fcd5147..0cd49259e 100644
--- a/packages/dashboard/src/__tests__/routes-agents.test.ts
+++ b/packages/dashboard/src/__tests__/routes-agents.test.ts
@@ -1959,7 +1959,7 @@ describe("Agent create/update routes", () => {
       JSON.stringify({
         name: "Invalid Policy Agent",
         role: "executor",
-        permissionPolicy: { presetId: "custom" },
+        permissionPolicy: { presetId: "not-a-preset" },
       }),
       { "Content-Type": "application/json" },
     );