diff --git a/pkg/cli/mcp_argument_validation.go b/pkg/cli/mcp_argument_validation.go
index b415a004b2e..c05a0ce296f 100644
--- a/pkg/cli/mcp_argument_validation.go
+++ b/pkg/cli/mcp_argument_validation.go
@@ -77,7 +77,12 @@ func argumentValidationMiddleware(toolParams map[string]toolParamEntry) mcp.Midd
 			toolName := extractMCPToolName(req)
 			validParams, ok := toolParams[toolName]
 			if !ok {
-				return nil, newMCPError(jsonrpc.CodeMethodNotFound, fmt.Sprintf("unknown MCP tool: %q", toolName), nil)
+				// The tool name is not in the hardcoded registry (mcpToolParams).
+				// This should not happen in practice because the registry is
+				// exhaustive. Escalating to a protocol-level internal error
+				// makes any registry gap fail loudly as a server bug instead of
+				// surfacing as an ordinary tool-level validation failure.
+				return nil, newMCPError(jsonrpc.CodeInternalError, fmt.Sprintf("unknown MCP tool: %q", toolName), nil)
 			}
 
 			mcpArgValidationLog.Printf("Intercepted unknown param error: tool=%s, unknown_params=%v", toolName, unknownParams)
diff --git a/pkg/cli/mcp_argument_validation_test.go b/pkg/cli/mcp_argument_validation_test.go
index dd10da4c6aa..a783639a239 100644
--- a/pkg/cli/mcp_argument_validation_test.go
+++ b/pkg/cli/mcp_argument_validation_test.go
@@ -296,9 +296,9 @@ func TestArgumentValidationMiddleware_PassesThroughSuccessResults(t *testing.T)
 	assert.False(t, toolResult.IsError)
 }
 
-// TestArgumentValidationMiddleware_UnknownToolReturnsMethodNotFound verifies
-// that an unregistered tool name is reported as method-not-found.
-func TestArgumentValidationMiddleware_UnknownToolReturnsMethodNotFound(t *testing.T) {
+// TestArgumentValidationMiddleware_UnknownToolReturnsInternalError verifies
+// that an unregistered tool name is reported as an internal server error.
+func TestArgumentValidationMiddleware_UnknownToolReturnsInternalError(t *testing.T) {
 	toolParams := map[string]toolParamEntry{
 		"compile": {"workflows"},
 	}
@@ -318,7 +318,7 @@ func TestArgumentValidationMiddleware_UnknownToolReturnsMethodNotFound(t *testin
 
 	var rpcErr *jsonrpc.Error
 	require.ErrorAs(t, err, &rpcErr, "error should be a JSON-RPC error")
-	assert.Equal(t, int64(jsonrpc.CodeMethodNotFound), rpcErr.Code, "unknown tool should use method-not-found code")
+	assert.Equal(t, int64(jsonrpc.CodeInternalError), rpcErr.Code, "unknown tool should use internal-error code")
 }
 
 // TestArgumentValidationMiddleware_PassesThroughNonToolCallMethods verifies
diff --git a/pkg/cli/mcp_server_http.go b/pkg/cli/mcp_server_http.go
index 9f3e2b4f74d..faa691657d9 100644
--- a/pkg/cli/mcp_server_http.go
+++ b/pkg/cli/mcp_server_http.go
@@ -29,6 +29,19 @@ type responseWriter struct {
 	statusCode int
 }
 
+func (w *responseWriter) WriteHeader(statusCode int) {
+	w.statusCode = statusCode
+	w.ResponseWriter.WriteHeader(statusCode)
+}
+
+func mcpHTTPServerAddr(port int) string {
+	return fmt.Sprintf("127.0.0.1:%d", port)
+}
+
+func mcpHTTPServerDisplayURL(port int) string {
+	return fmt.Sprintf("http://127.0.0.1:%d", port)
+}
+
 func loggingHandler(handler http.Handler) http.Handler {
 	return http.HandlerFunc(func(w http.ResponseWriter, r *http.Request) {
 		start := time.Now()
@@ -69,21 +82,26 @@ func runHTTPServer(server *mcp.Server, port int) error {
 	handler := mcp.NewStreamableHTTPHandler(func(req *http.Request) *mcp.Server {
 		return server
 	}, &mcp.StreamableHTTPOptions{
-		SessionTimeout: 2 * time.Hour, // Close idle sessions after 2 hours
-		Logger:         logger.NewSlogLoggerWithHandler(mcpLog),
+		SessionTimeout:             2 * time.Hour, // Close idle sessions after 2 hours
+		DisableLocalhostProtection: false,         // Keep the SDK's localhost Host-header checks enabled.
+		Logger:                     logger.NewSlogLoggerWithHandler(mcpLog),
 	})
 
 	handlerWithLogging := loggingHandler(handler)
 
-	// Create HTTP server
-	addr := fmt.Sprintf(":%d", port)
+	// Bind to loopback only. Since v1.6.0, the SDK no longer enables
+	// cross-origin protection by default, so binding to 127.0.0.1 (instead
+	// of all interfaces) is the safest default for a local MCP server — it
+	// prevents the server from being reachable on non-localhost interfaces.
+	// The SDK's localhost Host-header checks stay enabled as a second layer.
+	addr := mcpHTTPServerAddr(port)
 	httpServer := &http.Server{
 		Addr:              addr,
 		Handler:           handlerWithLogging,
 		ReadHeaderTimeout: MCPServerHTTPTimeout,
 	}
 
-	fmt.Fprintln(os.Stderr, console.FormatInfoMessage("Starting MCP server on http://localhost"+addr))
+	fmt.Fprintln(os.Stderr, console.FormatInfoMessage("Starting MCP server on "+mcpHTTPServerDisplayURL(port)))
 	mcpLog.Printf("HTTP server listening on %s", addr)
 
 	// Run the HTTP server
diff --git a/pkg/cli/mcp_server_http_test.go b/pkg/cli/mcp_server_http_test.go
index 8438f8794af..931c089b610 100644
--- a/pkg/cli/mcp_server_http_test.go
+++ b/pkg/cli/mcp_server_http_test.go
@@ -8,6 +8,40 @@ import (
 	"testing"
 )
 
+func TestMCPHTTPServerAddr_BindsToLoopback(t *testing.T) {
+	testCases := []struct {
+		port int
+		want string
+	}{
+		{port: 0, want: "127.0.0.1:0"},
+		{port: 12345, want: "127.0.0.1:12345"},
+		{port: 65535, want: "127.0.0.1:65535"},
+	}
+
+	for _, tc := range testCases {
+		if got := mcpHTTPServerAddr(tc.port); got != tc.want {
+			t.Errorf("mcpHTTPServerAddr(%d) = %q, want %q", tc.port, got, tc.want)
+		}
+	}
+}
+
+func TestMCPHTTPServerDisplayURL_UsesLoopbackAddress(t *testing.T) {
+	testCases := []struct {
+		port int
+		want string
+	}{
+		{port: 0, want: "http://127.0.0.1:0"},
+		{port: 12345, want: "http://127.0.0.1:12345"},
+		{port: 65535, want: "http://127.0.0.1:65535"},
+	}
+
+	for _, tc := range testCases {
+		if got := mcpHTTPServerDisplayURL(tc.port); got != tc.want {
+			t.Errorf("mcpHTTPServerDisplayURL(%d) = %q, want %q", tc.port, got, tc.want)
+		}
+	}
+}
+
 func TestSanitizeForLog_NoSpecialChars(t *testing.T) {
 	input := "/api/v1/workflows"
 	got := sanitizeForLog(input)
@@ -71,6 +105,9 @@ func TestResponseWriter_EmbeddedResponseWriter(t *testing.T) {
 	if rec.Code != http.StatusCreated {
 		t.Errorf("embedded ResponseWriter code = %d, want %d", rec.Code, http.StatusCreated)
 	}
+	if rw.statusCode != http.StatusCreated {
+		t.Errorf("responseWriter statusCode = %d, want %d", rw.statusCode, http.StatusCreated)
+	}
 }
 
 func TestLoggingHandler_PassesRequestToHandler(t *testing.T) {