diff --git a/packages/kilo-vscode/tests/unit/model-selector-utils.test.ts b/packages/kilo-vscode/tests/unit/model-selector-utils.test.ts
index ec29af0b2cb..71a3ce2d921 100644
--- a/packages/kilo-vscode/tests/unit/model-selector-utils.test.ts
+++ b/packages/kilo-vscode/tests/unit/model-selector-utils.test.ts
@@ -165,4 +165,42 @@ describe("buildTriggerLabel", () => {
     const raw = { providerID: "", modelID: "claude-3-5-sonnet" }
     expect(buildTriggerLabel(undefined, undefined, undefined, raw, false, "", true, labels)).toBe("Select model")
   })
+
+  it("returns placeholder when allowClear, no selection, and placeholder is provided", () => {
+    expect(
+      buildTriggerLabel(
+        undefined,
+        undefined,
+        undefined,
+        null,
+        true,
+        "Not set",
+        true,
+        labels,
+        "kilo-auto/small (default)",
+      ),
+    ).toBe("kilo-auto/small (default)")
+  })
+
+  it("returns clearLabel when allowClear, no selection, and no placeholder", () => {
+    expect(buildTriggerLabel(undefined, undefined, undefined, null, true, "Not set", true, labels, undefined)).toBe(
+      "Not set",
+    )
+  })
+
+  it("prefers resolved name over placeholder when value is selected", () => {
+    expect(
+      buildTriggerLabel(
+        "Claude Haiku",
+        "anthropic",
+        "Anthropic",
+        null,
+        true,
+        "Not set",
+        true,
+        labels,
+        "kilo-auto/small (default)",
+      ),
+    ).toBe("Anthropic / Claude Haiku")
+  })
 })
diff --git a/packages/kilo-vscode/webview-ui/src/components/settings/ModelsTab.tsx b/packages/kilo-vscode/webview-ui/src/components/settings/ModelsTab.tsx
index ee0eb3f56ac..5faa7b55f4c 100644
--- a/packages/kilo-vscode/webview-ui/src/components/settings/ModelsTab.tsx
+++ b/packages/kilo-vscode/webview-ui/src/components/settings/ModelsTab.tsx
@@ -59,8 +59,9 @@ const ModelsTab: Component = () => {
             onSelect={handleModelSelect("small_model")}
             placement="bottom-start"
             allowClear
-            clearLabel={language.t("settings.providers.notSet")}
+            clearLabel={language.t("settings.providers.smallModel.notSet")}
             includeAutoSmall
+            placeholder={language.t("settings.providers.smallModel.default")}
           />
         </SettingsRow>
       </Card>
diff --git a/packages/kilo-vscode/webview-ui/src/components/shared/ModelSelector.tsx b/packages/kilo-vscode/webview-ui/src/components/shared/ModelSelector.tsx
index 115a4bce587..06c2571de60 100644
--- a/packages/kilo-vscode/webview-ui/src/components/shared/ModelSelector.tsx
+++ b/packages/kilo-vscode/webview-ui/src/components/shared/ModelSelector.tsx
@@ -49,6 +49,8 @@ export interface ModelSelectorBaseProps {
   clearLabel?: string
   /** Include the kilo-auto/small model in the list — defaults to false */
   includeAutoSmall?: boolean
+  /** Placeholder shown on the trigger when no value is selected (e.g. default fallback model) */
+  placeholder?: string
 }
 
 export const ModelSelectorBase: Component<ModelSelectorBaseProps> = (props) => {
@@ -294,8 +296,11 @@ export const ModelSelectorBase: Component<ModelSelectorBaseProps> = (props) => {
         noProviders: language.t("dialog.model.noProviders"),
         notSet: language.t("dialog.model.notSet"),
       },
+      props.placeholder,
     )
 
+  const isPlaceholder = () => !props.value?.providerID && !!props.placeholder
+
   return (
     <PopupSelector
       expanded={expanded()}
@@ -316,7 +321,12 @@ export const ModelSelectorBase: Component<ModelSelectorBaseProps> = (props) => {
       }}
       trigger={
         <>
-          <span class="model-selector-trigger-label">{triggerLabel()}</span>
+          <span
+            class="model-selector-trigger-label"
+            style={isPlaceholder() ? { opacity: "0.6", "font-style": "italic" } : {}}
+          >
+            {triggerLabel()}
+          </span>
           <svg class="model-selector-trigger-chevron" width="10" height="10" viewBox="0 0 16 16" fill="currentColor">
             <path d="M8 4l4 5H4l4-5z" />
           </svg>
diff --git a/packages/kilo-vscode/webview-ui/src/components/shared/model-selector-utils.ts b/packages/kilo-vscode/webview-ui/src/components/shared/model-selector-utils.ts
index 270c03b0d8f..b53482b1e45 100644
--- a/packages/kilo-vscode/webview-ui/src/components/shared/model-selector-utils.ts
+++ b/packages/kilo-vscode/webview-ui/src/components/shared/model-selector-utils.ts
@@ -48,6 +48,7 @@ export function buildTriggerLabel(
   clearLabel: string,
   hasProviders: boolean,
   labels: { select: string; noProviders: string; notSet: string },
+  placeholder?: string,
 ): string {
   if (resolvedName) {
     if (providerID === KILO_GATEWAY_ID) return stripSubProviderPrefix(resolvedName)
@@ -57,6 +58,6 @@ export function buildTriggerLabel(
   if (raw?.providerID && raw?.modelID) {
     return raw.providerID === KILO_GATEWAY_ID ? raw.modelID : `${raw.providerID} / ${raw.modelID}`
   }
-  if (allowClear) return clearLabel || labels.notSet
+  if (allowClear) return placeholder || clearLabel || labels.notSet
   return hasProviders ? labels.select : labels.noProviders
 }
diff --git a/packages/kilo-vscode/webview-ui/src/i18n/en.ts b/packages/kilo-vscode/webview-ui/src/i18n/en.ts
index 52e1f8216c1..270e552056e 100644
--- a/packages/kilo-vscode/webview-ui/src/i18n/en.ts
+++ b/packages/kilo-vscode/webview-ui/src/i18n/en.ts
@@ -1217,6 +1217,8 @@ export const dict = {
   "settings.providers.smallModel.title": "Small Model",
   "settings.providers.smallModel.description":
     "Lightweight model for title generation, commit message generation, prompt enhancement, and other quick tasks",
+  "settings.providers.smallModel.default": "kilo-auto/small (default)",
+  "settings.providers.smallModel.notSet": "Not set (use kilo-auto/small)",
   "settings.providers.modeModels": "Model per Mode",
   "settings.providers.modeModels.description":
     "Override the default model for specific modes. If not set, the global default model is used.",