diff --git a/features/steps/tdd_budget_eviction_deletes_not_demotes_steps.py b/features/steps/tdd_budget_eviction_deletes_not_demotes_steps.py
new file mode 100644
index 000000000..bd61a8701
--- /dev/null
+++ b/features/steps/tdd_budget_eviction_deletes_not_demotes_steps.py
@@ -0,0 +1,223 @@
+"""Step definitions for TDD Issue #1152 — budget eviction deletes instead of demotes.
+
+These steps exercise ``ContextTierService`` to verify that hot-tier fragments
+evicted by budget enforcement (``_enforce_hot_budget``) are **demoted to the
+warm tier** rather than permanently deleted.
+
+Bug #1152: ``_enforce_hot_budget()`` in ``TierRuntimeMixin`` does
+``del self._hot[oldest_id]`` — the evicted fragment is destroyed.  The
+specification's downward tier lifecycle (§Plan Lifecycle ACMS Actions:
+"Hot context archived to warm") requires demotion, not deletion.
+
+Similarly, ``evict_lru()`` in ``ContextTierService`` permanently deletes
+fragments from the tier store without demoting them to the next lower tier.
+
+The assertions in these steps will **fail** until the bug is fixed,
+proving the bug exists.  The ``@tdd_expected_fail`` tag on the feature
+inverts the result so CI passes.
+"""
+
+from __future__ import annotations
+
+from datetime import UTC, datetime, timedelta
+
+from behave import given, then, when
+from behave.runner import Context
+
+from cleveragents.application.services.context_tiers import ContextTierService
+from cleveragents.domain.models.acms.tiers import (
+    ContextTier,
+    TierBudget,
+    TieredFragment,
+)
+
+# ---------------------------------------------------------------------------
+# Helpers
+# ---------------------------------------------------------------------------
+
+
+def _make_eviction_fragment(
+    fragment_id: str,
+    tier: ContextTier,
+    token_count: int = 50,
+    content: str = "test content",
+    last_accessed: datetime | None = None,
+) -> TieredFragment:
+    """Create a ``TieredFragment`` for eviction tests."""
+    fragment: TieredFragment = TieredFragment(
+        fragment_id=fragment_id,
+        content=content,
+        tier=tier,
+        token_count=token_count,
+        project_name="test-project",
+    )
+    if last_accessed is not None:
+        fragment.last_accessed = last_accessed
+    return fragment
+
+
+# ---------------------------------------------------------------------------
+# Scenario 1: Budget-evicted fragment demoted to warm (not deleted)
+# ---------------------------------------------------------------------------
+
+
+@given(
+    "a context tier service with a hot tier budget of {n:d} tokens for eviction test"
+)
+def step_eviction_service_small_budget(context: Context, n: int) -> None:
+    """Create a ContextTierService with a constrained hot tier budget."""
+    service: ContextTierService = ContextTierService(settings=None)
+    service._budget = TierBudget(
+        max_tokens_hot=n,
+        max_decisions_warm=500,
+        max_decisions_cold=5000,
+    )
+    context.eviction_service = service
+    context.eviction_budget_tokens = n
+
+
+@given(
+    "the hot tier contains two 50-token fragments filling the budget for eviction test"
+)
+def step_eviction_fill_hot_tier(context: Context) -> None:
+    """Fill the hot tier with exactly two 50-token fragments (100 tokens)."""
+    service: ContextTierService = context.eviction_service
+
+    # Fragment A: oldest (lower last_accessed)
+    frag_a: TieredFragment = _make_eviction_fragment(
+        fragment_id="frag-evict-oldest",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="oldest fragment content",
+        last_accessed=datetime.now(tz=UTC) - timedelta(minutes=10),
+    )
+    service.store(frag_a)
+
+    # Fragment B: newer
+    frag_b: TieredFragment = _make_eviction_fragment(
+        fragment_id="frag-evict-newer",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="newer fragment content",
+        last_accessed=datetime.now(tz=UTC) - timedelta(minutes=5),
+    )
+    service.store(frag_b)
+
+    context.eviction_oldest_id = "frag-evict-oldest"
+    context.eviction_newer_id = "frag-evict-newer"
+
+    metrics = service.get_metrics()
+    assert metrics.hot_count == 2, (
+        f"Expected 2 fragments in hot tier, got {metrics.hot_count}"
+    )
+
+
+@when("I store a third 50-token fragment in the hot tier triggering budget eviction")
+def step_eviction_store_overflow(context: Context) -> None:
+    """Store a fragment that exceeds the hot tier budget, triggering eviction."""
+    service: ContextTierService = context.eviction_service
+    overflow_frag: TieredFragment = _make_eviction_fragment(
+        fragment_id="frag-evict-overflow",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="overflow fragment content",
+    )
+    service.store(overflow_frag)
+
+
+@then("the evicted fragment should exist in the warm tier not be permanently deleted")
+def step_eviction_check_warm_tier(context: Context) -> None:
+    """Assert the budget-evicted fragment was demoted to warm, not deleted.
+
+    Bug #1152: ``_enforce_hot_budget()`` does ``del self._hot[oldest_id]``
+    which permanently destroys the fragment.  The correct behaviour is to
+    demote the fragment to the warm tier, preserving it in the lower tier
+    consistent with the specification's downward lifecycle flow.
+    """
+    service: ContextTierService = context.eviction_service
+    oldest_id: str = context.eviction_oldest_id
+
+    # The evicted fragment should NOT be in the hot tier
+    assert oldest_id not in service._hot, (
+        f"Fragment '{oldest_id}' is still in the hot tier after budget "
+        f"eviction — budget enforcement did not evict it."
+    )
+
+    # The evicted fragment SHOULD be in the warm tier (demoted, not deleted)
+    assert oldest_id in service._warm, (
+        f"Fragment '{oldest_id}' was evicted from the hot tier but is NOT "
+        f"in the warm tier.  _enforce_hot_budget() permanently deletes "
+        f"evicted fragments via 'del self._hot[oldest_id]' instead of "
+        f"demoting them to the warm tier (bug #1152).  The specification "
+        f"(§Plan Lifecycle ACMS Actions) describes a downward lifecycle: "
+        f"'Hot context archived to warm.'  Evicted fragments should be "
+        f"demoted to warm, not destroyed."
+    )
+
+    # Verify the fragment's tier metadata is updated to WARM
+    demoted: TieredFragment = service._warm[oldest_id]
+    assert demoted.tier == ContextTier.WARM, (
+        f"Fragment '{oldest_id}' is in the warm store but its tier "
+        f"metadata is {demoted.tier}, expected WARM."
+    )
+
+
+# ---------------------------------------------------------------------------
+# Scenario 2: evict_lru also demotes to warm instead of deleting
+# ---------------------------------------------------------------------------
+
+
+@when("I call evict_lru on the hot tier to remove one fragment")
+def step_eviction_call_evict_lru(context: Context) -> None:
+    """Call evict_lru(HOT, 1) to evict the oldest hot-tier fragment."""
+    service: ContextTierService = context.eviction_service
+    evicted_ids: list[str] = service.evict_lru(ContextTier.HOT, count=1)
+    context.eviction_lru_evicted_ids = evicted_ids
+
+
+@then(
+    "the LRU-evicted fragment should exist in the warm tier not be permanently deleted"
+)
+def step_eviction_lru_check_warm_tier(context: Context) -> None:
+    """Assert the LRU-evicted fragment was demoted to warm, not deleted.
+
+    Bug #1152: ``evict_lru()`` does ``del store[fid]`` which permanently
+    destroys the fragment.  The correct behaviour is to demote the
+    fragment to the next lower tier (hot → warm), preserving it
+    consistent with the specification's downward lifecycle flow.
+    """
+    service: ContextTierService = context.eviction_service
+    evicted_ids: list[str] = context.eviction_lru_evicted_ids
+
+    assert len(evicted_ids) == 1, f"Expected 1 evicted fragment, got {len(evicted_ids)}"
+
+    evicted_id: str = evicted_ids[0]
+
+    # The evicted fragment should be the oldest one
+    assert evicted_id == context.eviction_oldest_id, (
+        f"Expected oldest fragment '{context.eviction_oldest_id}' to be "
+        f"evicted, but '{evicted_id}' was evicted instead."
+    )
+
+    # The evicted fragment should NOT be in the hot tier
+    assert evicted_id not in service._hot, (
+        f"Fragment '{evicted_id}' is still in the hot tier after eviction."
+    )
+
+    # The evicted fragment SHOULD be in the warm tier (demoted, not deleted)
+    assert evicted_id in service._warm, (
+        f"Fragment '{evicted_id}' was evicted from the hot tier but is NOT "
+        f"in the warm tier.  evict_lru() permanently deletes evicted "
+        f"fragments via 'del store[fid]' instead of demoting them to the "
+        f"warm tier (bug #1152).  The specification (§Plan Lifecycle ACMS "
+        f"Actions) describes a downward lifecycle: 'Hot context archived "
+        f"to warm.'  Evicted fragments should be demoted to warm, not "
+        f"destroyed."
+    )
+
+    # Verify the fragment's tier metadata is updated to WARM
+    demoted: TieredFragment = service._warm[evicted_id]
+    assert demoted.tier == ContextTier.WARM, (
+        f"Fragment '{evicted_id}' is in the warm store but its tier "
+        f"metadata is {demoted.tier}, expected WARM."
+    )
diff --git a/features/tdd_budget_eviction_deletes_not_demotes.feature b/features/tdd_budget_eviction_deletes_not_demotes.feature
new file mode 100644
index 000000000..46c2ac720
--- /dev/null
+++ b/features/tdd_budget_eviction_deletes_not_demotes.feature
@@ -0,0 +1,28 @@
+@tdd_expected_fail @tdd_issue @tdd_issue_1152 @mock_only
+Feature: TDD Issue #1152 — budget eviction permanently deletes hot-tier fragments instead of demoting to warm
+  As a developer
+  I want to verify that budget-evicted hot-tier fragments are demoted to the warm tier
+  So that context data follows the spec's downward tier lifecycle rather than being destroyed
+
+  # This test captures bug #1152.  When the hot-tier token budget is
+  # exceeded, _enforce_hot_budget() permanently deletes evicted fragments
+  # via ``del self._hot[oldest_id]`` instead of demoting them to the warm
+  # tier.  The specification (§Plan Lifecycle ACMS Actions) describes a
+  # downward lifecycle: "Hot context archived to warm.  Warm context ages
+  # to cold based on retention policy."
+  #
+  # The @tdd_expected_fail tag inverts the result so CI passes while the
+  # bug is still present.  When bug #1152 is fixed, the @tdd_expected_fail
+  # tag must be removed so the test runs normally.
+
+  Scenario: Budget-evicted hot-tier fragment is demoted to warm tier instead of deleted
+    Given a context tier service with a hot tier budget of 100 tokens for eviction test
+    And the hot tier contains two 50-token fragments filling the budget for eviction test
+    When I store a third 50-token fragment in the hot tier triggering budget eviction
+    Then the evicted fragment should exist in the warm tier not be permanently deleted
+
+  Scenario: Budget eviction via evict_lru also demotes to warm tier instead of deleting
+    Given a context tier service with a hot tier budget of 100 tokens for eviction test
+    And the hot tier contains two 50-token fragments filling the budget for eviction test
+    When I call evict_lru on the hot tier to remove one fragment
+    Then the LRU-evicted fragment should exist in the warm tier not be permanently deleted
diff --git a/robot/helper_tdd_budget_eviction_deletes_not_demotes.py b/robot/helper_tdd_budget_eviction_deletes_not_demotes.py
new file mode 100644
index 000000000..11948a074
--- /dev/null
+++ b/robot/helper_tdd_budget_eviction_deletes_not_demotes.py
@@ -0,0 +1,226 @@
+"""Helper script for tdd_budget_eviction_deletes_not_demotes.robot smoke tests.
+
+Each subcommand exercises ``ContextTierService`` to reproduce bug #1152.
+The helper reports the **real** outcome: it exits 0 and prints the sentinel
+when the expected behaviour is observed (bug fixed), and exits 1 when the
+bug is still present.  The ``tdd_expected_fail_listener`` on the Robot side
+handles pass/fail inversion while the bug remains open.
+
+Bug #1152: ``_enforce_hot_budget()`` permanently deletes hot-tier fragments
+via ``del self._hot[oldest_id]`` instead of demoting them to the warm tier.
+Similarly, ``evict_lru()`` permanently deletes via ``del store[fid]``.
+"""
+
+from __future__ import annotations
+
+import sys
+from collections.abc import Callable
+from datetime import UTC, datetime, timedelta
+from pathlib import Path
+from typing import NoReturn
+
+# Ensure local source tree is importable.
+_ROOT: Path = Path(__file__).resolve().parents[1]
+_SRC: str = str(_ROOT / "src")
+_ROBOT: str = str(_ROOT / "robot")
+for _p in (_SRC, _ROBOT):
+    if _p not in sys.path:
+        sys.path.insert(0, _p)
+
+from cleveragents.application.services.context_tiers import (  # noqa: E402
+    ContextTierService,
+)
+from cleveragents.domain.models.acms.tiers import (  # noqa: E402
+    ContextTier,
+    TierBudget,
+    TieredFragment,
+)
+
+
+def _fail(msg: str) -> NoReturn:
+    """Print error message to stderr and exit with code 1."""
+    print(msg, file=sys.stderr)
+    sys.exit(1)
+
+
+def _make_fragment(
+    fragment_id: str,
+    tier: ContextTier,
+    token_count: int = 50,
+    content: str = "test content",
+    last_accessed: datetime | None = None,
+) -> TieredFragment:
+    """Create a ``TieredFragment`` with the given properties."""
+    fragment: TieredFragment = TieredFragment(
+        fragment_id=fragment_id,
+        content=content,
+        tier=tier,
+        token_count=token_count,
+        project_name="test-project",
+    )
+    if last_accessed is not None:
+        fragment.last_accessed = last_accessed
+    return fragment
+
+
+# ---------------------------------------------------------------------------
+# Subcommands
+# ---------------------------------------------------------------------------
+
+
+def _budget_eviction_demotes() -> None:
+    """Verify that budget-evicted hot-tier fragment is demoted to warm.
+
+    Bug #1152: ``_enforce_hot_budget()`` does
+    ``del self._hot[oldest_id]`` which permanently destroys the
+    fragment.  The correct behaviour is to demote to the warm tier.
+    """
+    service: ContextTierService = ContextTierService(settings=None)
+    service._budget = TierBudget(
+        max_tokens_hot=100,
+        max_decisions_warm=500,
+        max_decisions_cold=5000,
+    )
+
+    # Fill hot tier to exactly 100 tokens (2 x 50-token fragments)
+    frag_a: TieredFragment = _make_fragment(
+        fragment_id="frag-evict-oldest",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="oldest fragment",
+        last_accessed=datetime.now(tz=UTC) - timedelta(minutes=10),
+    )
+    service.store(frag_a)
+
+    frag_b: TieredFragment = _make_fragment(
+        fragment_id="frag-evict-newer",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="newer fragment",
+        last_accessed=datetime.now(tz=UTC) - timedelta(minutes=5),
+    )
+    service.store(frag_b)
+
+    # Store one more fragment to trigger budget eviction
+    overflow: TieredFragment = _make_fragment(
+        fragment_id="frag-evict-overflow",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="overflow fragment",
+    )
+    service.store(overflow)
+
+    # Check: the oldest fragment should NOT be in hot tier
+    if "frag-evict-oldest" in service._hot:
+        _fail(
+            "Fragment 'frag-evict-oldest' is still in hot tier after "
+            "budget overflow — budget enforcement did not evict it."
+        )
+
+    # Check: the oldest fragment SHOULD be in warm tier (demoted, not deleted)
+    if "frag-evict-oldest" not in service._warm:
+        _fail(
+            "Fragment 'frag-evict-oldest' was evicted from hot tier but "
+            "is NOT in the warm tier. _enforce_hot_budget() permanently "
+            "deletes evicted fragments instead of demoting them to warm "
+            "(bug #1152)."
+        )
+
+    # Verify tier metadata
+    demoted: TieredFragment = service._warm["frag-evict-oldest"]
+    if demoted.tier != ContextTier.WARM:
+        _fail(
+            f"Fragment is in warm store but tier metadata is "
+            f"{demoted.tier}, expected WARM."
+        )
+
+    print("tdd-budget-eviction-demotes-ok")
+
+
+def _evict_lru_demotes() -> None:
+    """Verify that evict_lru() demotes to warm instead of deleting.
+
+    Bug #1152: ``evict_lru()`` does ``del store[fid]`` which
+    permanently destroys the fragment.  The correct behaviour is to
+    demote to the next lower tier.
+    """
+    service: ContextTierService = ContextTierService(settings=None)
+    service._budget = TierBudget(
+        max_tokens_hot=100,
+        max_decisions_warm=500,
+        max_decisions_cold=5000,
+    )
+
+    # Store two fragments in hot tier
+    frag_a: TieredFragment = _make_fragment(
+        fragment_id="frag-lru-oldest",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="oldest fragment",
+        last_accessed=datetime.now(tz=UTC) - timedelta(minutes=10),
+    )
+    service.store(frag_a)
+
+    frag_b: TieredFragment = _make_fragment(
+        fragment_id="frag-lru-newer",
+        tier=ContextTier.HOT,
+        token_count=50,
+        content="newer fragment",
+        last_accessed=datetime.now(tz=UTC) - timedelta(minutes=5),
+    )
+    service.store(frag_b)
+
+    # Evict the LRU fragment
+    evicted_ids: list[str] = service.evict_lru(ContextTier.HOT, count=1)
+
+    if len(evicted_ids) != 1:
+        _fail(f"Expected 1 evicted fragment, got {len(evicted_ids)}")
+
+    evicted_id: str = evicted_ids[0]
+    if evicted_id != "frag-lru-oldest":
+        _fail(
+            f"Expected oldest fragment to be evicted, but '{evicted_id}' was evicted."
+        )
+
+    # Check: the evicted fragment should NOT be in hot tier
+    if evicted_id in service._hot:
+        _fail(f"Fragment '{evicted_id}' is still in hot tier after eviction.")
+
+    # Check: the evicted fragment SHOULD be in warm tier (demoted, not deleted)
+    if evicted_id not in service._warm:
+        _fail(
+            f"Fragment '{evicted_id}' was evicted from hot tier but is "
+            f"NOT in the warm tier. evict_lru() permanently deletes "
+            f"evicted fragments instead of demoting them to warm "
+            f"(bug #1152)."
+        )
+
+    # Verify tier metadata
+    demoted: TieredFragment = service._warm[evicted_id]
+    if demoted.tier != ContextTier.WARM:
+        _fail(
+            f"Fragment is in warm store but tier metadata is "
+            f"{demoted.tier}, expected WARM."
+        )
+
+    print("tdd-evict-lru-demotes-ok")
+
+
+# ---------------------------------------------------------------------------
+# Dispatcher
+# ---------------------------------------------------------------------------
+
+_COMMANDS: dict[str, Callable[[], None]] = {
+    "budget-eviction-demotes": _budget_eviction_demotes,
+    "evict-lru-demotes": _evict_lru_demotes,
+}
+
+if __name__ == "__main__":
+    if len(sys.argv) < 2 or sys.argv[1] not in _COMMANDS:
+        print(
+            f"Usage: {sys.argv[0]} <{'|'.join(_COMMANDS)}>",
+            file=sys.stderr,
+        )
+        sys.exit(1)
+    cmd: Callable[[], None] = _COMMANDS[sys.argv[1]]
+    cmd()
diff --git a/robot/tdd_budget_eviction_deletes_not_demotes.robot b/robot/tdd_budget_eviction_deletes_not_demotes.robot
new file mode 100644
index 000000000..8d2eb6d17
--- /dev/null
+++ b/robot/tdd_budget_eviction_deletes_not_demotes.robot
@@ -0,0 +1,34 @@
+*** Settings ***
+Documentation    TDD Issue #1152 — budget eviction permanently deletes hot-tier fragments
+...              instead of demoting to warm tier.  Integration smoke tests verifying that
+...              ContextTierService._enforce_hot_budget() and evict_lru() demote evicted
+...              fragments to the warm tier rather than permanently deleting them.
+...              Tests are tagged tdd_expected_fail so CI passes via result inversion.
+Resource         ${CURDIR}/common.resource
+Suite Setup      Setup Test Environment
+Suite Teardown   Cleanup Test Environment
+
+*** Variables ***
+${HELPER}    ${CURDIR}/helper_tdd_budget_eviction_deletes_not_demotes.py
+
+*** Test Cases ***
+TDD Budget Eviction Demotes To Warm Not Deletes
+    [Documentation]    Verify that when _enforce_hot_budget() evicts a fragment due to
+    ...                token budget overflow, the evicted fragment is demoted to the warm
+    ...                tier rather than permanently deleted.
+    [Tags]    tdd_expected_fail    tdd_issue    tdd_issue_1152
+    ${result}=    Run Process    ${PYTHON}    ${HELPER}    budget-eviction-demotes    cwd=${WORKSPACE}    timeout=30s
+    Log    ${result.stdout}
+    Log    ${result.stderr}
+    Should Be Equal As Integers    ${result.rc}    0
+    Should Contain    ${result.stdout}    tdd-budget-eviction-demotes-ok
+
+TDD Evict LRU Demotes To Warm Not Deletes
+    [Documentation]    Verify that evict_lru(HOT, 1) demotes the evicted fragment to the
+    ...                warm tier rather than permanently deleting it.
+    [Tags]    tdd_expected_fail    tdd_issue    tdd_issue_1152
+    ${result}=    Run Process    ${PYTHON}    ${HELPER}    evict-lru-demotes    cwd=${WORKSPACE}    timeout=30s
+    Log    ${result.stdout}
+    Log    ${result.stderr}
+    Should Be Equal As Integers    ${result.rc}    0
+    Should Contain    ${result.stdout}    tdd-evict-lru-demotes-ok