diff --git a/packages/api/src/__tests__/assistant-tools-timeline-inline-allocation-update-errors.test.ts b/packages/api/src/__tests__/assistant-tools-timeline-inline-allocation-update-errors.test.ts
new file mode 100644
index 0000000..a013828
--- /dev/null
+++ b/packages/api/src/__tests__/assistant-tools-timeline-inline-allocation-update-errors.test.ts
@@ -0,0 +1,165 @@
+import { beforeEach, describe, expect, it, vi } from "vitest";
+import { PermissionKey, SystemRole } from "@capakraken/shared";
+
+vi.mock("@capakraken/application", async (importOriginal) => {
+  const actual = await importOriginal<typeof import("@capakraken/application")>();
+  return {
+    ...actual,
+    getDashboardBudgetForecast: vi.fn().mockResolvedValue([]),
+    getDashboardPeakTimes: vi.fn().mockResolvedValue([]),
+    listAssignmentBookings: vi.fn().mockResolvedValue([]),
+  };
+});
+
+vi.mock("../sse/event-bus.js", () => ({
+  emitAllocationCreated: vi.fn(),
+  emitAllocationDeleted: vi.fn(),
+  emitAllocationUpdated: vi.fn(),
+  emitProjectShifted: vi.fn(),
+}));
+
+vi.mock("../lib/budget-alerts.js", () => ({
+  checkBudgetThresholds: vi.fn(),
+}));
+
+vi.mock("../lib/cache.js", () => ({
+  invalidateDashboardCache: vi.fn(),
+}));
+
+import { executeTool } from "../router/assistant-tools.js";
+import { createToolContext } from "./assistant-tools-advanced-timeline-test-helpers.js";
+import {
+  baseAvailability,
+  buildBaseAssignment,
+} from "./assistant-tools-timeline-allocation-mutation-test-helpers.js";
+
+describe("assistant timeline inline allocation update error tools", () => {
+  beforeEach(() => {
+    vi.clearAllMocks();
+  });
+
+  it("returns a stable validation error for inline timeline mutation date ranges", async () => {
+    const ctx = createToolContext(
+      {
+        allocation: {
+          findUnique: vi.fn().mockResolvedValue(null),
+        },
+        demandRequirement: {
+          findUnique: vi.fn().mockResolvedValue(null),
+        },
+        assignment: {
+          findUnique: vi.fn().mockResolvedValue(buildBaseAssignment()),
+        },
+        resource: {
+          findUnique: vi.fn().mockResolvedValue({
+            id: "resource_1",
+            lcrCents: 5000,
+            availability: baseAvailability,
+          }),
+        },
+      },
+      [PermissionKey.MANAGE_ALLOCATIONS, PermissionKey.USE_ASSISTANT_ADVANCED_TOOLS],
+      SystemRole.MANAGER,
+    );
+
+    const result = await executeTool(
+      "update_timeline_allocation_inline",
+      JSON.stringify({
+        allocationId: "assignment_1",
+        startDate: "2026-03-20",
+        endDate: "2026-03-16",
+      }),
+      ctx,
+    );
+
+    expect(JSON.parse(result.content)).toEqual({
+      error: "End date must be after start date",
+    });
+  });
+
+  it("returns a stable allocation-not-found error for inline timeline updates", async () => {
+    const db = {
+      allocation: {
+        findUnique: vi.fn().mockResolvedValue(null),
+      },
+      demandRequirement: {
+        findUnique: vi.fn().mockResolvedValue(null),
+      },
+      assignment: {
+        findUnique: vi.fn().mockResolvedValue(null),
+      },
+    };
+    const ctx = createToolContext(
+      db,
+      [PermissionKey.MANAGE_ALLOCATIONS, PermissionKey.USE_ASSISTANT_ADVANCED_TOOLS],
+      SystemRole.MANAGER,
+    );
+
+    const result = await executeTool(
+      "update_timeline_allocation_inline",
+      JSON.stringify({
+        allocationId: "assignment_missing",
+        hoursPerDay: 6,
+      }),
+      ctx,
+    );
+
+    expect(result.action).toBeUndefined();
+    expect(JSON.parse(result.content)).toEqual({
+      error: "Allocation not found with the given criteria.",
+    });
+  });
+
+  it("returns stable allocation-not-found errors when timeline allocation persistence loses the row", async () => {
+    const missingDuringUpdate = {
+      code: "P2025",
+      message: "Record to update not found",
+      meta: { modelName: "Assignment" },
+    };
+
+    const updateInlineCtx = createToolContext(
+      {
+        allocation: {
+          findUnique: vi.fn().mockResolvedValue(null),
+        },
+        demandRequirement: {
+          findUnique: vi.fn().mockResolvedValue(null),
+        },
+        assignment: {
+          findUnique: vi.fn().mockResolvedValue(buildBaseAssignment()),
+        },
+        resource: {
+          findUnique: vi.fn().mockResolvedValue({
+            id: "resource_1",
+            lcrCents: 5000,
+            availability: baseAvailability,
+          }),
+        },
+        auditLog: {
+          create: vi.fn().mockResolvedValue({}),
+        },
+        vacation: {
+          findMany: vi.fn().mockResolvedValue([]),
+        },
+        $transaction: vi.fn(async () => {
+          throw missingDuringUpdate;
+        }),
+      },
+      [PermissionKey.MANAGE_ALLOCATIONS, PermissionKey.USE_ASSISTANT_ADVANCED_TOOLS],
+      SystemRole.MANAGER,
+    );
+
+    const updateInlineResult = await executeTool(
+      "update_timeline_allocation_inline",
+      JSON.stringify({
+        allocationId: "assignment_1",
+        hoursPerDay: 6,
+      }),
+      updateInlineCtx,
+    );
+
+    expect(JSON.parse(updateInlineResult.content)).toEqual({
+      error: "Allocation not found with the given criteria.",
+    });
+  });
+});
diff --git a/packages/api/src/__tests__/assistant-tools-timeline-inline-allocation-update-success.test.ts b/packages/api/src/__tests__/assistant-tools-timeline-inline-allocation-update-success.test.ts
new file mode 100644
index 0000000..c47353b
--- /dev/null
+++ b/packages/api/src/__tests__/assistant-tools-timeline-inline-allocation-update-success.test.ts
@@ -0,0 +1,112 @@
+import { beforeEach, describe, expect, it, vi } from "vitest";
+import { AllocationStatus, PermissionKey, SystemRole } from "@capakraken/shared";
+
+vi.mock("@capakraken/application", async (importOriginal) => {
+  const actual = await importOriginal<typeof import("@capakraken/application")>();
+  return {
+    ...actual,
+    getDashboardBudgetForecast: vi.fn().mockResolvedValue([]),
+    getDashboardPeakTimes: vi.fn().mockResolvedValue([]),
+    listAssignmentBookings: vi.fn().mockResolvedValue([]),
+  };
+});
+
+vi.mock("../sse/event-bus.js", () => ({
+  emitAllocationCreated: vi.fn(),
+  emitAllocationDeleted: vi.fn(),
+  emitAllocationUpdated: vi.fn(),
+  emitProjectShifted: vi.fn(),
+}));
+
+vi.mock("../lib/budget-alerts.js", () => ({
+  checkBudgetThresholds: vi.fn(),
+}));
+
+vi.mock("../lib/cache.js", () => ({
+  invalidateDashboardCache: vi.fn(),
+}));
+
+import { executeTool } from "../router/assistant-tools.js";
+import { createToolContext } from "./assistant-tools-advanced-timeline-test-helpers.js";
+import {
+  buildBaseAssignment,
+  buildBaseResource,
+} from "./assistant-tools-timeline-allocation-mutation-test-helpers.js";
+
+describe("assistant timeline inline allocation update success tools", () => {
+  beforeEach(() => {
+    vi.clearAllMocks();
+  });
+
+  it("updates timeline allocations inline through the real timeline router mutation", async () => {
+    const existingAssignment = {
+      ...buildBaseAssignment(),
+      status: AllocationStatus.PROPOSED,
+    };
+    const updatedAssignment = {
+      ...existingAssignment,
+      hoursPerDay: 6,
+      endDate: new Date("2026-03-21"),
+      percentage: 75,
+      dailyCostCents: 30000,
+      metadata: { includeSaturday: true },
+      updatedAt: new Date("2026-03-14"),
+    };
+
+    const db = {
+      allocation: {
+        findUnique: vi.fn().mockResolvedValue(null),
+      },
+      demandRequirement: {
+        findUnique: vi.fn().mockResolvedValue(null),
+      },
+      assignment: {
+        findUnique: vi.fn().mockResolvedValue(existingAssignment),
+        update: vi.fn().mockResolvedValue(updatedAssignment),
+      },
+      resource: {
+        findUnique: vi.fn().mockResolvedValue(buildBaseResource()),
+      },
+      vacation: {
+        findMany: vi.fn().mockResolvedValue([]),
+      },
+      auditLog: {
+        create: vi.fn().mockResolvedValue({}),
+      },
+      $transaction: vi.fn(async (callback: (tx: unknown) => unknown) => callback(db)),
+    };
+    const ctx = createToolContext(
+      db,
+      [PermissionKey.MANAGE_ALLOCATIONS, PermissionKey.USE_ASSISTANT_ADVANCED_TOOLS],
+      SystemRole.MANAGER,
+    );
+
+    const result = await executeTool(
+      "update_timeline_allocation_inline",
+      JSON.stringify({
+        allocationId: "assignment_1",
+        hoursPerDay: 6,
+        endDate: "2026-03-21",
+        includeSaturday: true,
+      }),
+      ctx,
+    );
+
+    expect(result.action).toEqual({ type: "invalidate", scope: ["allocation", "timeline", "project"] });
+    expect(JSON.parse(result.content)).toEqual(
+      expect.objectContaining({
+        success: true,
+        allocation: expect.objectContaining({
+          id: "assignment_1",
+          hoursPerDay: 6,
+          endDate: "2026-03-21",
+        }),
+      }),
+    );
+    expect(db.assignment.update).toHaveBeenCalledWith(
+      expect.objectContaining({
+        where: { id: "assignment_1" },
+      }),
+    );
+  });
+});