diff --git a/src/lib/usage/providerLimits.ts b/src/lib/usage/providerLimits.ts
index d3de997e75..cf02868f2d 100644
--- a/src/lib/usage/providerLimits.ts
+++ b/src/lib/usage/providerLimits.ts
@@ -14,6 +14,7 @@ import {
 import { syncToCloud } from "@/lib/cloudSync";
 import { setQuotaCache } from "@/domain/quotaCache";
 import { buildClaudeExtraUsageConnectionUpdate } from "@/lib/providers/claudeExtraUsage";
+import { clearRecoveredProviderState } from "@/sse/services/auth";
 import { getMachineId } from "@/shared/utils/machine";
 import { USAGE_SUPPORTED_PROVIDERS } from "@/shared/constants/providers";
 import { getExecutor } from "@omniroute/open-sse/executors/index.ts";
@@ -392,9 +393,87 @@ export function quotaPathShouldMarkExpired(
   return true;
 }
 
-async function syncExpiredStatusIfNeeded(connection: ProviderConnectionLike, usage: JsonRecord) {
+const TERMINAL_STATUSES_FOR_QUOTA_RECOVERY = new Set([
+  "credits_exhausted",
+  "banned",
+  "expired",
+  "deactivated",
+]);
+
+function isTerminalStatusForQuotaRecovery(testStatus: string | null | undefined): boolean {
+  if (!testStatus) return false;
+  return TERMINAL_STATUSES_FOR_QUOTA_RECOVERY.has(testStatus);
+}
+
+export function hasUsableQuota(usage: JsonRecord): boolean {
+  const quotas = usage?.quotas;
+  if (!isRecord(quotas)) return false;
+  for (const value of Object.values(quotas)) {
+    if (!isRecord(value)) continue;
+    if (value.unlimited === true) return true;
+    const remaining =
+      typeof value.remaining === "number"
+        ? value.remaining
+        : typeof value.remainingPercentage === "number"
+          ? value.remainingPercentage
+          : null;
+    if (remaining !== null && remaining > 0) return true;
+  }
+  return false;
+}
+
+export async function maybeClearRecoveredQuotaState(
+  connection: ProviderConnectionLike,
+  usage: JsonRecord
+): Promise<ProviderConnectionLike> {
+  if (!hasUsableQuota(usage)) return connection;
+  if (isTerminalStatusForQuotaRecovery(connection.testStatus)) return connection;
+
+  const hasTransientState =
+    connection.testStatus === "unavailable" ||
+    Boolean(connection.rateLimitedUntil) ||
+    Boolean(connection.lastError) ||
+    Boolean(connection.errorCode) ||
+    Boolean(connection.lastErrorType) ||
+    Boolean(connection.lastErrorSource) ||
+    (connection.backoffLevel ?? 0) > 0;
+
+  if (!hasTransientState) return connection;
+
+  try {
+    await clearRecoveredProviderState({
+      connectionId: connection.id,
+      testStatus: connection.testStatus,
+      lastError: connection.lastError ?? null,
+      rateLimitedUntil: connection.rateLimitedUntil ?? null,
+      errorCode: connection.errorCode ?? null,
+      lastErrorType: connection.lastErrorType ?? null,
+      lastErrorSource: connection.lastErrorSource ?? null,
+    });
+  } catch (dbError) {
+    console.warn("[ProviderLimits] Failed to clear recovered quota state:", dbError);
+    return connection;
+  }
+
+  return {
+    ...connection,
+    testStatus: "active",
+    lastError: null,
+    lastErrorAt: null,
+    lastErrorType: null,
+    lastErrorSource: null,
+    errorCode: null,
+    rateLimitedUntil: null,
+    backoffLevel: 0,
+  };
+}
+
+async function syncExpiredStatusIfNeeded(
+  connection: ProviderConnectionLike,
+  usage: JsonRecord
+): Promise<ProviderConnectionLike> {
   if (!quotaPathShouldMarkExpired(connection.provider, usage.message, connection.testStatus)) {
-    return;
+    return connection;
   }
 
   try {
@@ -405,7 +484,14 @@ async function syncExpiredStatusIfNeeded(connection: ProviderConnectionLike, usa
     });
   } catch (dbError) {
     console.error("[ProviderLimits] Failed to sync expired status to DB:", dbError);
+    return connection;
   }
+
+  return {
+    ...connection,
+    testStatus: "expired",
+    lastErrorType: "token_expired",
+  };
 }
 
 async function syncClaudeExtraUsageStateIfNeeded(
@@ -626,10 +712,11 @@ async function fetchLiveProviderLimitsWithOptions(
     if (isRecord(usage.quotas)) {
       setQuotaCache(connectionId, connection.provider, usage.quotas);
     }
-    await syncExpiredStatusIfNeeded(connection, usage);
+    connection = await syncExpiredStatusIfNeeded(connection, usage);
     connection = await syncClaudeExtraUsageStateIfNeeded(connection, usage);
     connection = await syncClaudeBootstrapIfNeeded(connection, usage);
     connection = await syncAntigravitySubscriptionIfNeeded(connection, usage);
+    connection = await maybeClearRecoveredQuotaState(connection, usage);
     return { connection, usage };
   }
 
@@ -740,10 +827,11 @@ async function fetchLiveProviderLimitsWithOptions(
   if (isRecord(result.usage.quotas)) {
     setQuotaCache(connectionId, connection.provider, result.usage.quotas);
   }
-  await syncExpiredStatusIfNeeded(connection, result.usage);
+  connection = await syncExpiredStatusIfNeeded(connection, result.usage);
   connection = await syncClaudeExtraUsageStateIfNeeded(connection, result.usage);
   connection = await syncClaudeBootstrapIfNeeded(connection, result.usage);
   connection = await syncAntigravitySubscriptionIfNeeded(connection, result.usage);
+  connection = await maybeClearRecoveredQuotaState(connection, result.usage);
 
   return {
     connection,
diff --git a/tests/unit/provider-limits-recovery.test.ts b/tests/unit/provider-limits-recovery.test.ts
new file mode 100644
index 0000000000..f719d19090
--- /dev/null
+++ b/tests/unit/provider-limits-recovery.test.ts
@@ -0,0 +1,203 @@
+import test from "node:test";
+import assert from "node:assert/strict";
+import fs from "node:fs";
+import os from "node:os";
+import path from "node:path";
+
+const TEST_DATA_DIR = fs.mkdtempSync(path.join(os.tmpdir(), "omniroute-provider-limits-recovery-"));
+process.env.DATA_DIR = TEST_DATA_DIR;
+process.env.API_KEY_SECRET = "test-provider-limits-recovery-secret";
+
+const core = await import("../../src/lib/db/core.ts");
+const providersDb = await import("../../src/lib/db/providers.ts");
+const providerLimits = await import("../../src/lib/usage/providerLimits.ts");
+
+const originalFetch = globalThis.fetch;
+
+async function resetStorage() {
+  core.resetDbInstance();
+  fs.rmSync(TEST_DATA_DIR, { recursive: true, force: true });
+  fs.mkdirSync(TEST_DATA_DIR, { recursive: true });
+}
+
+async function withMockedFetch(fetchImpl: typeof fetch, fn: () => Promise<void>) {
+  const previousFetch = globalThis.fetch;
+  globalThis.fetch = fetchImpl;
+  try {
+    await fn();
+  } finally {
+    globalThis.fetch = previousFetch;
+  }
+}
+
+async function createGlmConnectionWithTransientCooldown() {
+  return providersDb.createProviderConnection({
+    provider: "glm",
+    authType: "apikey",
+    name: `GLM Recovery ${Date.now()}`,
+    apiKey: "glm-test-key",
+    testStatus: "unavailable",
+    rateLimitedUntil: new Date(Date.now() + 60_000).toISOString(),
+    lastError: "rate limit exceeded",
+    lastErrorType: "rate_limited",
+    lastErrorSource: "executor",
+    errorCode: 429,
+    backoffLevel: 2,
+  });
+}
+
+function glmQuotaResponse() {
+  // Mirrors open-sse/services/usage/glm.ts: TOKENS_LIMIT window with remaining.
+  return new Response(
+    JSON.stringify({
+      code: 200,
+      success: true,
+      data: {
+        planName: "max",
+        limits: [
+          {
+            type: "TOKENS_LIMIT",
+            unit: 3,
+            number: 5,
+            percentage: 13,
+            nextResetTime: Math.floor(Date.now() / 1000) + 3 * 3600,
+            models: [],
+          },
+        ],
+      },
+    }),
+    { status: 200, headers: { "content-type": "application/json" } }
+  );
+}
+
+test.beforeEach(async () => {
+  globalThis.fetch = originalFetch;
+  await resetStorage();
+});
+
+test.after(async () => {
+  globalThis.fetch = originalFetch;
+  core.resetDbInstance();
+  fs.rmSync(TEST_DATA_DIR, { recursive: true, force: true });
+});
+
+test("successful GLM quota refresh clears transient rate-limit state", async () => {
+  const connection = await createGlmConnectionWithTransientCooldown();
+  const connectionId = (connection as { id: string }).id;
+
+  await withMockedFetch(
+    (() => glmQuotaResponse()) as typeof fetch,
+    async () => {
+      await providerLimits.fetchAndPersistProviderLimits(connectionId, "manual");
+    }
+  );
+
+  const updated = (await providersDb.getProviderConnectionById(connectionId)) as Record<
+    string,
+    unknown
+  >;
+  assert.equal(updated.testStatus, "active", "testStatus should be reset to active");
+  assert.equal(updated.rateLimitedUntil, undefined, "rateLimitedUntil should be cleared");
+  assert.equal(updated.errorCode, undefined, "errorCode should be cleared");
+  assert.equal(updated.lastErrorType, undefined, "lastErrorType should be cleared");
+  assert.equal(updated.backoffLevel, 0, "backoffLevel should be reset to 0");
+});
+
+async function createGlmConnectionWithStatus(status: string) {
+  return providersDb.createProviderConnection({
+    provider: "glm",
+    authType: "apikey",
+    name: "GLM " + status + " " + Date.now(),
+    apiKey: "glm-test-key",
+    testStatus: status,
+    lastError: "permanent failure",
+    lastErrorType: "permanent",
+    errorCode: 403,
+    backoffLevel: 1,
+  });
+}
+
+test("successful quota refresh does not clear terminal credits_exhausted status", async () => {
+  const connection = await createGlmConnectionWithStatus("credits_exhausted");
+  const connectionId = (connection as { id: string }).id;
+
+  await withMockedFetch(
+    (() => glmQuotaResponse()) as typeof fetch,
+    async () => {
+      await providerLimits.fetchAndPersistProviderLimits(connectionId, "manual");
+    }
+  );
+
+  const updated = (await providersDb.getProviderConnectionById(connectionId)) as Record<
+    string,
+    unknown
+  >;
+  assert.equal(updated.testStatus, "credits_exhausted");
+  assert.equal(updated.lastErrorType, "permanent");
+});
+
+test("successful quota refresh does not clear terminal banned status", async () => {
+  const connection = await createGlmConnectionWithStatus("banned");
+  const connectionId = (connection as { id: string }).id;
+
+  await withMockedFetch(
+    (() => glmQuotaResponse()) as typeof fetch,
+    async () => {
+      await providerLimits.fetchAndPersistProviderLimits(connectionId, "manual");
+    }
+  );
+
+  const updated = (await providersDb.getProviderConnectionById(connectionId)) as Record<
+    string,
+    unknown
+  >;
+  assert.equal(updated.testStatus, "banned");
+});
+
+test("successful quota refresh does not clear terminal expired status", async () => {
+  const connection = await createGlmConnectionWithStatus("expired");
+  const connectionId = (connection as { id: string }).id;
+
+  await withMockedFetch(
+    (() => glmQuotaResponse()) as typeof fetch,
+    async () => {
+      await providerLimits.fetchAndPersistProviderLimits(connectionId, "manual");
+    }
+  );
+
+  const updated = (await providersDb.getProviderConnectionById(connectionId)) as Record<
+    string,
+    unknown
+  >;
+  assert.equal(updated.testStatus, "expired");
+});
+
+test("error-only quota response does not clear transient state", async () => {
+  const connection = await createGlmConnectionWithTransientCooldown();
+  const connectionId = (connection as { id: string }).id;
+
+  await withMockedFetch(
+    (() =>
+      new Response(JSON.stringify({ message: "GLM quota API error (429)" }), {
+        status: 429,
+        headers: { "content-type": "application/json" },
+      })) as typeof fetch,
+    async () => {
+      // The live GLM usage path throws on a 429 (it does not return an error
+      // envelope), so the fetch rejects. The transient-state assertions below then
+      // confirm the throw happened BEFORE maybeClearRecoveredQuotaState — i.e. an
+      // errored refresh never clears the connection's cooldown.
+      await assert.rejects(
+        () => providerLimits.fetchAndPersistProviderLimits(connectionId, "manual"),
+        /429/
+      );
+    }
+  );
+
+  const updated = (await providersDb.getProviderConnectionById(connectionId)) as Record<
+    string,
+    unknown
+  >;
+  assert.equal(updated.testStatus, "unavailable", "transient state should not be cleared on error");
+  assert.equal(updated.lastErrorType, "rate_limited");
+});