diff --git a/src/negative_test/claude-code-settings/additional-properties-hook.json b/src/negative_test/claude-code-settings/additional-properties-hook.json
new file mode 100644
index 00000000000..c38f3f836d1
--- /dev/null
+++ b/src/negative_test/claude-code-settings/additional-properties-hook.json
@@ -0,0 +1,17 @@
+{
+  "hooks": {
+    "PreToolUse": [
+      {
+        "extraField": "should not be allowed",
+        "hooks": [
+          {
+            "command": "echo 'test'",
+            "type": "command",
+            "unknownProperty": "not allowed"
+          }
+        ],
+        "matcher": "Write"
+      }
+    ]
+  }
+}
diff --git a/src/negative_test/claude-code-settings/invalid-enum-values.json b/src/negative_test/claude-code-settings/invalid-enum-values.json
new file mode 100644
index 00000000000..250d2b2b679
--- /dev/null
+++ b/src/negative_test/claude-code-settings/invalid-enum-values.json
@@ -0,0 +1,6 @@
+{
+  "forceLoginMethod": "github",
+  "permissions": {
+    "defaultMode": "invalid-mode"
+  }
+}
diff --git a/src/negative_test/claude-code-settings/invalid-env-variable-name.json b/src/negative_test/claude-code-settings/invalid-env-variable-name.json
new file mode 100644
index 00000000000..3f2c7183803
--- /dev/null
+++ b/src/negative_test/claude-code-settings/invalid-env-variable-name.json
@@ -0,0 +1,9 @@
+{
+  "env": {
+    "HAS SPACES": "should fail",
+    "has-dashes": "should fail",
+    "lowercase": "should fail",
+    "valid_VAR": "ok",
+    "123STARTS_WITH_NUMBER": "should fail"
+  }
+}
diff --git a/src/negative_test/claude-code-settings/invalid-hook-type.json b/src/negative_test/claude-code-settings/invalid-hook-type.json
new file mode 100644
index 00000000000..ccc08d2afa1
--- /dev/null
+++ b/src/negative_test/claude-code-settings/invalid-hook-type.json
@@ -0,0 +1,15 @@
+{
+  "hooks": {
+    "PreToolUse": [
+      {
+        "hooks": [
+          {
+            "command": "echo 'Invalid type - should be command'",
+            "type": "script"
+          }
+        ],
+        "matcher": "Write"
+      }
+    ]
+  }
+}
diff --git a/src/negative_test/claude-code-settings/invalid-permission-rule.json b/src/negative_test/claude-code-settings/invalid-permission-rule.json
new file mode 100644
index 00000000000..676bc5a8fca
--- /dev/null
+++ b/src/negative_test/claude-code-settings/invalid-permission-rule.json
@@ -0,0 +1,10 @@
+{
+  "permissions": {
+    "allow": [
+      "InvalidTool",
+      "Bash without parentheses",
+      "Read[wrong-brackets]",
+      "WebFetch(invalid:syntax"
+    ]
+  }
+}
diff --git a/src/negative_test/claude-code-settings/invalid-timeout-value.json b/src/negative_test/claude-code-settings/invalid-timeout-value.json
new file mode 100644
index 00000000000..a0ed3c0fe26
--- /dev/null
+++ b/src/negative_test/claude-code-settings/invalid-timeout-value.json
@@ -0,0 +1,15 @@
+{
+  "hooks": {
+    "PreToolUse": [
+      {
+        "hooks": [
+          {
+            "command": "echo 'test'",
+            "timeout": 0,
+            "type": "command"
+          }
+        ]
+      }
+    ]
+  }
+}
diff --git a/src/negative_test/claude-code-settings/missing-required-hook-fields.json b/src/negative_test/claude-code-settings/missing-required-hook-fields.json
new file mode 100644
index 00000000000..b3adc9d2644
--- /dev/null
+++ b/src/negative_test/claude-code-settings/missing-required-hook-fields.json
@@ -0,0 +1,13 @@
+{
+  "hooks": {
+    "PostToolUse": [
+      {
+        "hooks": [
+          {
+            "type": "command"
+          }
+        ]
+      }
+    ]
+  }
+}
diff --git a/src/negative_test/claude-code-settings/wrong-property-types.json b/src/negative_test/claude-code-settings/wrong-property-types.json
new file mode 100644
index 00000000000..5f90e1bac85
--- /dev/null
+++ b/src/negative_test/claude-code-settings/wrong-property-types.json
@@ -0,0 +1,10 @@
+{
+  "cleanupPeriodDays": "thirty",
+  "enableAllProjectMcpServers": 1,
+  "includeCoAuthoredBy": "yes",
+  "learnMode": "true",
+  "permissions": {
+    "additionalDirectories": "should be array",
+    "allow": "should be array"
+  }
+}
diff --git a/src/schemas/json/claude-code-settings.json b/src/schemas/json/claude-code-settings.json
index d2b48200ef4..b1415b69e13 100644
--- a/src/schemas/json/claude-code-settings.json
+++ b/src/schemas/json/claude-code-settings.json
@@ -2,7 +2,48 @@
   "$schema": "http://json-schema.org/draft-07/schema#",
   "$id": "https://json.schemastore.org/claude-code-settings.json",
   "$defs": {
-    "rule": {
+    "hookCommand": {
+      "type": "object",
+      "description": "Hook command configuration",
+      "additionalProperties": false,
+      "required": ["type", "command"],
+      "properties": {
+        "type": {
+          "type": "string",
+          "description": "Type of hook implementation",
+          "const": "command"
+        },
+        "command": {
+          "type": "string",
+          "description": "Shell command to execute"
+        },
+        "timeout": {
+          "type": "number",
+          "description": "Optional timeout in seconds for this specific command",
+          "exclusiveMinimum": 0
+        }
+      }
+    },
+    "hookMatcher": {
+      "type": "object",
+      "description": "Hook matcher configuration with multiple hooks",
+      "additionalProperties": false,
+      "required": ["hooks"],
+      "properties": {
+        "matcher": {
+          "type": "string",
+          "description": "String (e.g. Write) to match values related to the hook event, e.g. tool names"
+        },
+        "hooks": {
+          "type": "array",
+          "description": "Array of hooks to execute",
+          "items": {
+            "$ref": "#/$defs/hookCommand"
+          }
+        }
+      }
+    },
+    "permissionRule": {
       "type": "string",
       "description": "Tool permission rule (e.g., 'Bash(ls:*)', 'Read(~/.zshrc)', 'WebFetch(domain:github.com)')",
       "pattern": "^(Agent|Bash|Edit|Glob|Grep|LS|MultiEdit|NotebookEdit|NotebookRead|Read|TodoRead|TodoWrite|WebFetch|WebSearch|Write)\\(?|^mcp__"
@@ -21,14 +62,8 @@
       "type": "string",
       "description": "Custom script path to generate an auth value"
     },
-    "autoUpdaterStatus": {
-      "type": "string",
-      "description": "Enable or disable the auto-updater",
-      "enum": ["enabled", "disabled"],
-      "default": "enabled"
-    },
     "cleanupPeriodDays": {
-      "type": "number",
+      "type": "integer",
       "description": "How long to locally retain chat transcripts (in days)",
       "default": 30,
       "minimum": 0
@@ -52,8 +87,7 @@
     },
     "model": {
       "type": "string",
-      "description": "Claude model to use",
-      "enum": ["opus", "sonnet"]
+      "description": "Deprecated: use env.ANTHROPIC_MODEL and env.ANTHROPIC_SMALL_FAST_MODEL instead. Either \"sonnet\", \"opus\", or a specific Claude model ID (see https://docs.anthropic.com/en/docs/about-claude/models/overview)"
     },
     "permissions": {
       "type": "object",
@@ -62,42 +96,104 @@
       "properties": {
         "allow": {
           "type": "array",
-          "description": "List of allowed tool rules",
-          "items": { "$ref": "#/$defs/rule" },
+          "description": "List of allowed tool permission rules",
+          "items": { "$ref": "#/$defs/permissionRule" },
           "uniqueItems": true
         },
         "deny": {
           "type": "array",
-          "description": "List of denied tool rules",
-          "items": { "$ref": "#/$defs/rule" },
+          "description": "List of denied tool permission rules",
+          "items": { "$ref": "#/$defs/permissionRule" },
+          "uniqueItems": true
+        },
+        "defaultMode": {
+          "type": "string",
+          "description": "Default permission mode for tool execution",
+          "enum": ["acceptEdits", "bypassPermissions", "default", "plan"]
+        },
+        "disableBypassPermissionsMode": {
+          "type": "string",
+          "description": "Disable bypass permissions mode",
+          "const": "disable"
+        },
+        "additionalDirectories": {
+          "type": "array",
+          "description": "Paths to additional directories Claude can access beyond the working directory",
+          "items": {
+            "type": "string"
+          },
           "uniqueItems": true
         }
-      },
-      "default": {
-        "allow": [],
-        "deny": []
       }
     },
-    "preferredNotifChannel": {
-      "type": "string",
-      "description": "Preferred notification channel",
-      "enum": [
-        "iterm2",
-        "iterm2_with_bell",
-        "terminal_bell",
-        "notifications_disabled"
-      ],
-      "default": "iterm2"
+    "enableAllProjectMcpServers": {
+      "type": "boolean",
+      "description": "Whether to automatically approve all MCP servers in the project"
     },
-    "theme": {
-      "type": "string",
-      "description": "UI theme configuration",
-      "enum": ["dark", "light", "light-daltonized", "dark-daltonized"]
+    "enabledMcpjsonServers": {
+      "type": "array",
+      "description": "List of allowed MCP servers from .mcp.json",
+      "items": {
+        "type": "string"
+      }
+    },
+    "disabledMcpjsonServers": {
+      "type": "array",
+      "description": "List of denied MCP servers from .mcp.json",
+      "items": {
+        "type": "string"
+      }
+    },
+    "hooks": {
+      "type": "object",
+      "description": "Hooks configuration for executing commands at specific points in Claude Code's lifecycle",
+      "additionalProperties": false,
+      "properties": {
+        "PreToolUse": {
+          "type": "array",
+          "description": "Hooks that run before tool calls",
+          "items": {
+            "$ref": "#/$defs/hookMatcher"
+          }
+        },
+        "PostToolUse": {
+          "type": "array",
+          "description": "Hooks that run after tool completion",
+          "items": {
+            "$ref": "#/$defs/hookMatcher"
+          }
+        },
+        "Notification": {
+          "type": "array",
+          "description": "Hooks that trigger on notifications",
+          "items": {
+            "$ref": "#/$defs/hookMatcher"
+          }
+        },
+        "Stop": {
+          "type": "array",
+          "description": "Hooks that run when agents finish responding",
+          "items": {
+            "$ref": "#/$defs/hookMatcher"
+          }
+        },
+        "SubagentStop": {
+          "type": "array",
+          "description": "Hooks that run when subagents finish responding",
+          "items": {
+            "$ref": "#/$defs/hookMatcher"
+          }
+        }
+      }
     },
-    "verbose": {
+    "learnMode": {
       "type": "boolean",
-      "description": "Show full bash and command outputs",
-      "default": false
+      "description": "Request the model focuses more on educating and co-creating with the user, rather than just completing tasks"
+    },
+    "forceLoginMethod": {
+      "type": "string",
+      "description": "Force a specific login method, and skip the login method selection screen",
+      "enum": ["claudeai", "console"]
     }
   }
 }
diff --git a/src/test/claude-code-settings/hooks-complete.json b/src/test/claude-code-settings/hooks-complete.json
new file mode 100644
index 00000000000..c81092942a9
--- /dev/null
+++ b/src/test/claude-code-settings/hooks-complete.json
@@ -0,0 +1,68 @@
+{
+  "hooks": {
+    "Notification": [
+      {
+        "hooks": [
+          {
+            "command": "osascript -e 'display notification \"Claude task complete\" with title \"Claude Code\"'",
+            "type": "command"
+          }
+        ]
+      }
+    ],
+    "PostToolUse": [
+      {
+        "hooks": [
+          {
+            "command": "git diff",
+            "type": "command"
+          }
+        ],
+        "matcher": "Edit"
+      }
+    ],
+    "PreToolUse": [
+      {
+        "hooks": [
+          {
+            "command": "echo 'About to write file' >> /tmp/claude-log.txt",
+            "type": "command"
+          }
+        ],
+        "matcher": "Write"
+      },
+      {
+        "hooks": [
+          {
+            "command": "echo 'Running bash command' >> /tmp/claude-log.txt",
+            "timeout": 5,
+            "type": "command"
+          }
+        ],
+        "matcher": "Bash"
+      }
+    ],
+    "Stop": [
+      {
+        "hooks": [
+          {
+            "command": "echo 'Claude finished' | tee -a /tmp/claude-session.log",
+            "type": "command"
+          }
+        ]
+      }
+    ],
+    "SubagentStop": [
+      {
+        "hooks": [
+          {
+            "command": "echo 'Subagent completed' >> /tmp/claude-subagent.log",
+            "timeout": 2,
+            "type": "command"
+          }
+        ],
+        "matcher": "Agent"
+      }
+    ]
+  }
+}
diff --git a/src/test/claude-code-settings/mcp-servers.json b/src/test/claude-code-settings/mcp-servers.json
new file mode 100644
index 00000000000..cabd490d41b
--- /dev/null
+++ b/src/test/claude-code-settings/mcp-servers.json
@@ -0,0 +1,5 @@
+{
+  "disabledMcpjsonServers": ["experimental-server", "legacy-api"],
+  "enableAllProjectMcpServers": false,
+  "enabledMcpjsonServers": ["filesystem", "github", "database-reader"]
+}
diff --git a/src/test/claude-code-settings/modern-complete-config.json b/src/test/claude-code-settings/modern-complete-config.json
new file mode 100644
index 00000000000..841578041d0
--- /dev/null
+++ b/src/test/claude-code-settings/modern-complete-config.json
@@ -0,0 +1,67 @@
+{
+  "$schema": "https://json.schemastore.org/claude-code-settings.json",
+  "apiKeyHelper": "/usr/local/bin/claude-auth-helper",
+  "cleanupPeriodDays": 60,
+  "disabledMcpjsonServers": ["untrusted-server"],
+  "enableAllProjectMcpServers": true,
+  "env": {
+    "ANTHROPIC_MODEL": "claude-3-5-sonnet-20241022",
+    "ANTHROPIC_SMALL_FAST_MODEL": "claude-3-5-haiku-20241022",
+    "CLAUDE_LOG_LEVEL": "debug",
+    "PROJECT_ROOT": "/home/user/projects"
+  },
+  "forceLoginMethod": "claudeai",
+  "hooks": {
+    "PreToolUse": [
+      {
+        "hooks": [
+          {
+            "command": "echo 'File write detected' >> ~/.claude-code/activity.log",
+            "type": "command"
+          }
+        ],
+        "matcher": "Write"
+      }
+    ],
+    "Stop": [
+      {
+        "hooks": [
+          {
+            "command": "osascript -e 'display notification \"Task completed\" with title \"Claude Code\"'",
+            "timeout": 3,
+            "type": "command"
+          }
+        ]
+      }
+    ]
+  },
+  "includeCoAuthoredBy": true,
+  "learnMode": true,
+  "permissions": {
+    "additionalDirectories": ["~/Documents/reference", "~/.config/claude-code"],
+    "allow": [
+      "Agent",
+      "Bash(git:*)",
+      "Bash(npm:*)",
+      "Edit",
+      "Glob",
+      "Grep",
+      "LS",
+      "MultiEdit",
+      "NotebookEdit",
+      "Read",
+      "TodoWrite",
+      "WebFetch(domain:*.anthropic.com)",
+      "WebSearch",
+      "Write",
+      "mcp__*"
+    ],
+    "defaultMode": "plan",
+    "deny": [
+      "Bash(sudo:*)",
+      "Bash(rm -rf:*)",
+      "Write(/etc/**)",
+      "Write(/System/**)"
+    ]
+  }
+}
diff --git a/src/test/claude-code-settings/permissions-advanced.json b/src/test/claude-code-settings/permissions-advanced.json
new file mode 100644
index 00000000000..72637fa9586
--- /dev/null
+++ b/src/test/claude-code-settings/permissions-advanced.json
@@ -0,0 +1,26 @@
+{
+  "permissions": {
+    "additionalDirectories": [
+      "~/Documents/shared-projects",
+      "/opt/company/resources"
+    ],
+    "allow": [
+      "Agent",
+      "Glob",
+      "Grep",
+      "LS",
+      "Read(~/projects/**)",
+      "Edit(~/projects/**)",
+      "MultiEdit",
+      "NotebookEdit",
+      "TodoWrite",
+      "WebFetch(domain:github.com)",
+      "WebSearch",
+      "mcp__ide__getDiagnostics",
+      "mcp__ide__executeCode"
+    ],
+    "defaultMode": "acceptEdits",
+    "deny": ["Bash(rm:*)", "Write(/etc/**)", "WebFetch(domain:malicious.com)"],
+    "disableBypassPermissionsMode": "disable"
+  }
+}