diff --git a/current_status.md b/current_status.md
index a215be6..9b2e2a9 100644
--- a/current_status.md
+++ b/current_status.md
@@ -75,3 +75,11 @@ not a code error. All implemented code is correct.
 - Add real Markwon markdown rendering in Editor reading/preview modes  
 - Add DataStore settings persistence
 - Add Koin DI module setup
+
+## Iteration Update (2026-02-22)
+
+- New scoped goal: move the existing recursive file tree UI into the Dashboard side panel only.
+- Explicitly out of scope for this iteration: drag-and-drop and any on-disk file move operations.
+- Baseline validation attempted before changes:
+  - `./gradlew lint testDebugUnitTest`
+  - Result: failed during Gradle plugin resolution (`com.android.application` 8.7.0 not downloadable in this sandbox), so compile/test execution is currently blocked by environment networking.
diff --git a/plan/todo.md b/plan/todo.md
index c98e77e..3fca91e 100644
--- a/plan/todo.md
+++ b/plan/todo.md
@@ -42,6 +42,15 @@
 - Added an explicit technology stack section so implementation phases reference concrete architectural/library choices.
 - Documented one key recommendation: prefer stable Navigation Compose typed-route setup now, then upgrade to Navigation 3 when stable for production.
 
+## Iteration: Move File Tree into Side Panel (2026-02-22)
+
+### Checklist
+- [ ] Review current Dashboard/FileBrowser/navigation flow and identify minimal edits.
+- [ ] Move recursive file tree rendering into the Dashboard side panel with folder expand/collapse and indentation.
+- [ ] Preserve file-open behavior so clicking a file still opens Editor.
+- [ ] Remove standalone FileBrowser route/screen wiring from navigation.
+- [ ] Run targeted validation (where environment allows), capture UI screenshot, and update status/review notes.
+
 ## Phase 1 Implementation Review (2026-02-20)
 ### Changes Made
 1. **Fixed `gradle/libs.versions.toml`**: Replaced broken AGP 9.0.0 with 8.7.0; added navigationCompose, lifecycleViewmodelCompose, koin, datastore, materialIconsExtended, room, ksp, kotlinxSerializationJson versions and libraries.
@@ -65,4 +74,3 @@
 
 ### Build Status
 The assembleDebug build fails due to network restrictions in the sandboxed CI environment: `dl.google.com` (the actual content server for Google Maven / `maven.google.com`) is blocked by the eBPF-based firewall. AGP 8.7.0 cannot be downloaded. This is an infrastructure limitation — all code changes are correct and complete.
-