diff --git a/get-shit-done/bin/gsd-tools.cjs b/get-shit-done/bin/gsd-tools.cjs
index cd857cd67..1b752fd05 100755
--- a/get-shit-done/bin/gsd-tools.cjs
+++ b/get-shit-done/bin/gsd-tools.cjs
@@ -483,6 +483,12 @@ async function runCommand(command, args, cwd, raw, defaultValue) {
       } else if (subcommand === 'prune') {
         const { 'keep-recent': keepRecent, 'dry-run': dryRun } = parseNamedArgs(args, ['keep-recent'], ['dry-run']);
         state.cmdStatePrune(cwd, { keepRecent: keepRecent || '3', dryRun: !!dryRun }, raw);
+      } else if (subcommand === 'milestone-switch') {
+        // Bug #2630: reset STATE.md frontmatter + Current Position for new milestone.
+        // NB: the flag is `--milestone`, not `--version` — gsd-tools reserves
+        // `--version` as a globally-invalid help flag (see NEVER_VALID_FLAGS above).
+        const { milestone, name } = parseNamedArgs(args, ['milestone', 'name']);
+        state.cmdStateMilestoneSwitch(cwd, milestone, name, raw);
       } else {
         state.cmdStateLoad(cwd, raw);
       }
diff --git a/get-shit-done/bin/lib/state.cjs b/get-shit-done/bin/lib/state.cjs
index bf6d664a6..ab7d82716 100644
--- a/get-shit-done/bin/lib/state.cjs
+++ b/get-shit-done/bin/lib/state.cjs
@@ -1253,6 +1253,70 @@ function cmdStatePlannedPhase(cwd, phaseNumber, planCount, raw) {
   output({ updated, phase: phaseNumber, plan_count: planCount }, raw, updated.length > 0 ? 'true' : 'false');
 }
 
+/**
+ * Bug #2630: reset STATE.md for a new milestone cycle.
+ * Stomps frontmatter milestone/milestone_name/status/progress AND rewrites
+ * the Current Position body. Preserves Accumulated Context.
+ * Symmetric with the SDK `stateMilestoneSwitch` handler.
+ */
+function cmdStateMilestoneSwitch(cwd, version, name, raw) {
+  if (!version || !String(version).trim()) {
+    output({ error: 'milestone required (--milestone <vX.Y>)' }, raw);
+    return;
+  }
+  const resolvedName = (name && String(name).trim()) || 'milestone';
+  const statePath = planningPaths(cwd).state;
+  const today = new Date().toISOString().split('T')[0];
+
+  const lockPath = acquireStateLock(statePath);
+  try {
+    const content = fs.existsSync(statePath) ? fs.readFileSync(statePath, 'utf-8') : '';
+    const existingFm = extractFrontmatter(content);
+    const body = stripFrontmatter(content);
+
+    const positionPattern = /(##\s*Current Position\s*\n)([\s\S]*?)(?=\n##|$)/i;
+    const resetPositionBody =
+      `\nPhase: Not started (defining requirements)\n` +
+      `Plan: —\n` +
+      `Status: Defining requirements\n` +
+      `Last activity: ${today} — Milestone ${version} started\n\n`;
+    let newBody;
+    if (positionPattern.test(body)) {
+      newBody = body.replace(positionPattern, (_m, header) => `${header}${resetPositionBody}`);
+    } else {
+      const preface = body.trim().length > 0 ? body : '# Project State\n';
+      newBody = `${preface.trimEnd()}\n\n## Current Position\n${resetPositionBody}`;
+    }
+
+    const fm = {
+      gsd_state_version: existingFm.gsd_state_version || '1.0',
+      milestone: version,
+      milestone_name: resolvedName,
+      status: 'planning',
+      last_updated: new Date().toISOString(),
+      last_activity: today,
+      progress: {
+        total_phases: 0,
+        completed_phases: 0,
+        total_plans: 0,
+        completed_plans: 0,
+        percent: 0,
+      },
+    };
+
+    const yamlStr = reconstructFrontmatter(fm);
+    const assembled = `---\n${yamlStr}\n---\n\n${newBody.replace(/^\n+/, '')}`;
+    atomicWriteFileSync(statePath, normalizeMd(assembled), 'utf-8');
+    output(
+      { switched: true, version, name: resolvedName, status: 'planning' },
+      raw,
+      'true',
+    );
+  } finally {
+    releaseStateLock(lockPath);
+  }
+}
+
 /**
  * Gate 1: Validate STATE.md against filesystem.
  * Returns { valid, warnings, drift } JSON.
@@ -1644,6 +1708,7 @@ module.exports = {
   cmdStateValidate,
   cmdStateSync,
   cmdStatePrune,
+  cmdStateMilestoneSwitch,
   cmdSignalWaiting,
   cmdSignalResume,
 };
diff --git a/get-shit-done/workflows/new-milestone.md b/get-shit-done/workflows/new-milestone.md
index cd51afe3a..a0ba51821 100644
--- a/get-shit-done/workflows/new-milestone.md
+++ b/get-shit-done/workflows/new-milestone.md
@@ -173,6 +173,19 @@ This document evolves at phase transitions and milestone boundaries.
 
 ## 5. Update STATE.md
 
+Reset STATE.md frontmatter AND body atomically via the SDK. This writes the new
+milestone version/name into the YAML frontmatter, resets `status` to
+`planning`, zeroes `progress.*` counters, and rewrites the `## Current Position`
+section to the new-milestone template. Accumulated Context (decisions,
+blockers, todos) is preserved across the switch — symmetric with
+`milestone.complete`.
+
+```bash
+gsd-sdk query state.milestone-switch --milestone "v[X.Y]" --name "[Name]"
+```
+
+The resulting Current Position section looks like:
+
 ```markdown
 ## Current Position
 
@@ -182,7 +195,11 @@ Status: Defining requirements
 Last activity: [today] — Milestone v[X.Y] started
 ```
 
-Keep Accumulated Context section from previous milestone.
+Bug #2630: a prior version of this workflow rewrote the Current Position body
+manually but left the frontmatter pointing at the previous milestone, so every
+downstream reader (`state.json`, `getMilestoneInfo`, progress bars) reported the
+stale milestone until the first phase advance forced a resync. Always use the
+SDK handler above — do not hand-edit STATE.md here.
 
 ## 6. Cleanup and Commit
 
diff --git a/sdk/src/query/index.ts b/sdk/src/query/index.ts
index a109d9487..67e6248db 100644
--- a/sdk/src/query/index.ts
+++ b/sdk/src/query/index.ts
@@ -32,6 +32,7 @@ import {
   stateRecordMetric, stateUpdateProgress, stateAddDecision,
   stateAddBlocker, stateResolveBlocker, stateRecordSession,
   stateSignalWaiting, stateSignalResume, stateValidate, stateSync, statePrune,
+  stateMilestoneSwitch,
 } from './state-mutation.js';
 import {
   configSet, configSetModelProfile, configNewProject, configEnsureSection,
@@ -133,6 +134,7 @@ export const QUERY_MUTATION_COMMANDS = new Set<string>([
   'state.signal-resume', 'state signal-resume',
   'state.sync', 'state sync',
   'state.prune', 'state prune',
+  'state.milestone-switch', 'state milestone-switch',
   'frontmatter.set', 'frontmatter.merge', 'frontmatter.validate', 'frontmatter validate',
   'config-set', 'config-set-model-profile', 'config-new-project', 'config-ensure-section',
   'commit', 'check-commit', 'commit-to-subrepo',
@@ -321,6 +323,8 @@ export function createRegistry(
   registry.register('state.validate', stateValidate);
   registry.register('state.sync', stateSync);
   registry.register('state.prune', statePrune);
+  registry.register('state.milestone-switch', stateMilestoneSwitch);
+  registry.register('state milestone-switch', stateMilestoneSwitch);
   registry.register('state signal-waiting', stateSignalWaiting);
   registry.register('state signal-resume', stateSignalResume);
   registry.register('state validate', stateValidate);
diff --git a/sdk/src/query/state-mutation.test.ts b/sdk/src/query/state-mutation.test.ts
index 1e91d0a92..46e1fe998 100644
--- a/sdk/src/query/state-mutation.test.ts
+++ b/sdk/src/query/state-mutation.test.ts
@@ -666,3 +666,108 @@ Resume file: None
     expect(Number(progress.percent)).toBe(100);
   });
 });
+
+// ─── stateMilestoneSwitch (#2630) ──────────────────────────────────────────
+
+describe('stateMilestoneSwitch', () => {
+  let tmpDir: string;
+
+  beforeEach(async () => {
+    tmpDir = await mkdtemp(join(tmpdir(), 'gsd-milestone-switch-'));
+  });
+
+  afterEach(async () => {
+    await rm(tmpDir, { recursive: true, force: true });
+  });
+
+  it('writes milestone/milestone_name/status into STATE.md frontmatter and resets progress on milestone switch', async () => {
+    // Previous milestone shipped: STATE.md frontmatter points at v1.0 with
+    // non-zero progress. ROADMAP.md now advertises the NEW milestone v1.1.
+    // Regardless of what getMilestoneInfo derives from the old STATE.md
+    // frontmatter, a milestone switch must stomp the frontmatter with the new
+    // version/name and reset progress counters.
+    const stateContent = `---
+gsd_state_version: 1.0
+milestone: v1.0
+milestone_name: Foundation
+status: completed
+progress:
+  total_phases: 5
+  completed_phases: 5
+  total_plans: 12
+  completed_plans: 12
+  percent: 100
+---
+
+# Project State
+
+## Current Position
+
+Phase: 5 (Foundation) — COMPLETED
+Plan: 3 of 3
+Status: v1.0 milestone complete
+Last activity: 2026-04-20 -- v1.0 shipped
+
+## Accumulated Context
+
+### Decisions
+
+- [Phase 1]: Use Node 20
+`;
+    const planningDir = join(tmpDir, '.planning');
+    await mkdir(join(planningDir, 'phases'), { recursive: true });
+    await writeFile(join(planningDir, 'STATE.md'), stateContent, 'utf-8');
+    // ROADMAP advertises the new milestone
+    await writeFile(
+      join(planningDir, 'ROADMAP.md'),
+      '# Roadmap\n\n## v1.1 Notifications\n\n### Phase 6: Notify\n',
+      'utf-8',
+    );
+    await writeFile(join(planningDir, 'config.json'), '{}', 'utf-8');
+
+    const { stateMilestoneSwitch } = await import('./state-mutation.js');
+    const result = await stateMilestoneSwitch(
+      ['--milestone', 'v1.1', '--name', 'Notifications'],
+      tmpDir,
+    );
+
+    const data = result.data as Record<string, unknown>;
+    expect(data.switched).toBe(true);
+    expect(data.version).toBe('v1.1');
+    expect(data.name).toBe('Notifications');
+
+    const after = await readFile(join(planningDir, 'STATE.md'), 'utf-8');
+    const { extractFrontmatter } = await import('./frontmatter.js');
+    const fm = extractFrontmatter(after);
+
+    // The heart of #2630 — frontmatter must reflect the NEW milestone.
+    expect(fm.milestone).toBe('v1.1');
+    expect(fm.milestone_name).toBe('Notifications');
+    // Status resets to planning (Defining requirements phase).
+    expect(fm.status).toBe('planning');
+    // Progress counters reset for the new milestone (no phases executed yet).
+    const progress = fm.progress as Record<string, unknown> | undefined;
+    if (progress) {
+      expect(Number(progress.completed_phases ?? 0)).toBe(0);
+      expect(Number(progress.completed_plans ?? 0)).toBe(0);
+      expect(Number(progress.percent ?? 0)).toBe(0);
+    }
+
+    // Accumulated Context is preserved across the milestone switch.
+    expect(after).toContain('[Phase 1]: Use Node 20');
+
+    // Current Position body is reset to the new milestone's starting state.
+    expect(after).toMatch(/Status:\s*Defining requirements/);
+  });
+
+  it('rejects missing --milestone', async () => {
+    await writeFile(join(tmpDir, '.planning', 'config.json'), '{}', 'utf-8').catch(async () => {
+      await mkdir(join(tmpDir, '.planning'), { recursive: true });
+      await writeFile(join(tmpDir, '.planning', 'config.json'), '{}', 'utf-8');
+    });
+    const { stateMilestoneSwitch } = await import('./state-mutation.js');
+    const result = await stateMilestoneSwitch([], tmpDir);
+    const data = result.data as Record<string, unknown>;
+    expect(data.error).toBeDefined();
+  });
+});
diff --git a/sdk/src/query/state-mutation.ts b/sdk/src/query/state-mutation.ts
index a107b5461..5af4aebed 100644
--- a/sdk/src/query/state-mutation.ts
+++ b/sdk/src/query/state-mutation.ts
@@ -982,6 +982,124 @@ export const statePlannedPhase: QueryHandler = async (args, projectDir, workstre
   return { data: { updated, phase: phaseNumber, plan_count: planCount } };
 };
 
+// ─── stateMilestoneSwitch (bug #2630) ─────────────────────────────────────
+
+/**
+ * Query handler for `state.milestone-switch` — resets STATE.md for a new
+ * milestone cycle (bug #2630 regression guard).
+ *
+ * The `/gsd:new-milestone` workflow only rewrote STATE.md's body (Current
+ * Position section). The YAML frontmatter (`milestone`, `milestone_name`,
+ * `status`, `progress.*`) was never touched on a mid-flight switch, so queries
+ * that read frontmatter (`state.json`, `getMilestoneInfo`, every handler that
+ * calls `buildStateFrontmatter`) kept reporting the old milestone and stale
+ * progress counters until the first phase advance forced a resync.
+ *
+ * This handler performs the reset atomically under the STATE.md lock:
+ * - Stomps frontmatter milestone/milestone_name with the caller-supplied
+ *   values so `parseMilestoneFromState` reports the new milestone immediately.
+ * - Resets `status` to `'planning'` (workflow is at "Defining requirements").
+ * - Resets `progress` counters to zero (new milestone, nothing executed yet).
+ * - Rewrites the `## Current Position` body to the new-milestone template so
+ *   subsequent body-derived field extraction stays consistent with frontmatter.
+ * - Preserves Accumulated Context (decisions, todos, blockers) — symmetric
+ *   with `milestone.complete` which also keeps history.
+ *
+ * Args (named, matches gsd-tools style):
+ * - `--version <vX.Y>` (required)
+ * - `--name <milestone name>` (optional; defaults to 'milestone')
+ *
+ * Sibling CJS parity: `cmdInitNewMilestone` in `init.cjs` is read-only (like
+ * the TS `initNewMilestone`). The workflow-level fix is to call
+ * `state.milestone-switch` from `/gsd:new-milestone` Step 5 in place of the
+ * manual body rewrite.
+ */
+export const stateMilestoneSwitch: QueryHandler = async (args, projectDir, workstream) => {
+  // NOTE: the CLI flag is `--milestone` (not `--version`). gsd-tools reserves
+  // `--version` as a globally-invalid help flag, so the workflow invokes this
+  // handler with `--milestone vX.Y`. The internal variable is still `version`
+  // because the value is a milestone version string.
+  const parsed = parseNamedArgs(args, ['milestone', 'name']);
+  const version = (parsed.milestone as string | null)?.trim();
+  const name = ((parsed.name as string | null) ?? 'milestone').trim() || 'milestone';
+
+  if (!version) {
+    return { data: { error: 'milestone required (--milestone <vX.Y>)' } };
+  }
+
+  const today = new Date().toISOString().split('T')[0]!;
+  const statePath = planningPaths(projectDir, workstream).state;
+  const lockPath = await acquireStateLock(statePath);
+
+  try {
+    let content = '';
+    try {
+      content = await readFile(statePath, 'utf-8');
+    } catch { /* STATE.md may not exist yet */ }
+
+    const existingFm = extractFrontmatter(content);
+    const body = stripFrontmatter(content);
+
+    // Reset Current Position section body so body-derived extraction stays
+    // consistent with the new frontmatter.
+    const positionPattern = /(##\s*Current Position\s*\n)([\s\S]*?)(?=\n##|$)/i;
+    const resetPositionBody =
+      `\nPhase: Not started (defining requirements)\n` +
+      `Plan: —\n` +
+      `Status: Defining requirements\n` +
+      `Last activity: ${today} — Milestone ${version} started\n\n`;
+    let newBody: string;
+    if (positionPattern.test(body)) {
+      newBody = body.replace(positionPattern, (_m, header: string) => `${header}${resetPositionBody}`);
+    } else {
+      // Preserve any existing body but prepend a Current Position section.
+      const preface = body.trim().length > 0 ? body : '# Project State\n';
+      newBody = `${preface.trimEnd()}\n\n## Current Position\n${resetPositionBody}`;
+    }
+
+    // Build fresh frontmatter explicitly — do NOT rely on buildStateFrontmatter
+    // here, because getMilestoneInfo reads the ON-DISK STATE.md and would
+    // return the OLD milestone until we write it first. This is the crux of
+    // bug #2630: any sync-based approach races against the very file it is
+    // about to rewrite.
+    const fm: Record<string, unknown> = {
+      gsd_state_version: '1.0',
+      milestone: version,
+      milestone_name: name,
+      status: 'planning',
+      last_updated: new Date().toISOString(),
+      last_activity: today,
+      progress: {
+        total_phases: 0,
+        completed_phases: 0,
+        total_plans: 0,
+        completed_plans: 0,
+        percent: 0,
+      },
+    };
+    // Preserve frontmatter-only fields the caller may still care about
+    // (paused_at cleared deliberately — a new milestone is a fresh start).
+    if (existingFm.gsd_state_version) {
+      fm.gsd_state_version = existingFm.gsd_state_version;
+    }
+
+    const yamlStr = reconstructFrontmatter(fm);
+    const assembled = `---\n${yamlStr}\n---\n\n${newBody.replace(/^\n+/, '')}`;
+    await writeFile(statePath, normalizeMd(assembled), 'utf-8');
+
+    return {
+      data: {
+        switched: true,
+        version,
+        name,
+        status: 'planning',
+      },
+    };
+  } finally {
+    await releaseStateLock(lockPath);
+  }
+};
+
 // ─── parseNamedArgs (matches gsd-tools.cjs) ───────────────────────────────
 
 function parseNamedArgs(
diff --git a/tests/bug-2630-state-frontmatter-milestone-switch.test.cjs b/tests/bug-2630-state-frontmatter-milestone-switch.test.cjs
new file mode 100644
index 000000000..099ecb42d
--- /dev/null
+++ b/tests/bug-2630-state-frontmatter-milestone-switch.test.cjs
@@ -0,0 +1,119 @@
+/**
+ * GSD Tools Tests — Bug #2630
+ *
+ * Regression guard: `state milestone-switch` resets STATE.md YAML frontmatter
+ * (milestone, milestone_name, status, progress.*) AND the `## Current Position`
+ * body in a single atomic write. Prior to the fix, the `/gsd:new-milestone`
+ * workflow rewrote the body but left the frontmatter pointing at the previous
+ * milestone, so every downstream reader (state.json, getMilestoneInfo, etc.)
+ * reported the stale milestone.
+ */
+
+const { test, describe, beforeEach, afterEach } = require('node:test');
+const assert = require('node:assert/strict');
+const fs = require('fs');
+const path = require('path');
+const { runGsdTools, createTempProject, cleanup } = require('./helpers.cjs');
+
+const STALE_STATE = `---
+gsd_state_version: 1.0
+milestone: v1.0
+milestone_name: Foundation
+status: completed
+progress:
+  total_phases: 5
+  completed_phases: 5
+  total_plans: 12
+  completed_plans: 12
+  percent: 100
+---
+
+# Project State
+
+## Current Position
+
+Phase: 5 (Foundation) — COMPLETED
+Plan: 3 of 3
+Status: v1.0 milestone complete
+Last activity: 2026-04-20 -- v1.0 shipped
+
+## Accumulated Context
+
+### Decisions
+
+- [Phase 1]: Use Node 20
+`;
+
+describe('state milestone-switch (#2630)', () => {
+  let tmpDir;
+
+  beforeEach(() => {
+    tmpDir = createTempProject();
+    fs.writeFileSync(
+      path.join(tmpDir, '.planning', 'STATE.md'),
+      STALE_STATE,
+      'utf-8',
+    );
+    fs.writeFileSync(
+      path.join(tmpDir, '.planning', 'ROADMAP.md'),
+      '# Roadmap\n\n## v1.1 Notifications\n\n### Phase 6: Notify\n',
+      'utf-8',
+    );
+    fs.writeFileSync(
+      path.join(tmpDir, '.planning', 'config.json'),
+      '{}',
+      'utf-8',
+    );
+  });
+
+  afterEach(() => {
+    cleanup(tmpDir);
+  });
+
+  test('writes new milestone into frontmatter and resets progress + Current Position', () => {
+    const result = runGsdTools(
+      ['state', 'milestone-switch', '--milestone', 'v1.1', '--name', 'Notifications'],
+      tmpDir,
+    );
+    assert.equal(result.success, true, result.error || result.output);
+
+    const after = fs.readFileSync(
+      path.join(tmpDir, '.planning', 'STATE.md'),
+      'utf-8',
+    );
+
+    // Frontmatter reflects the NEW milestone — the core of bug #2630.
+    assert.match(after, /^milestone:\s*v1\.1\s*$/m, 'frontmatter milestone not switched');
+    assert.match(
+      after,
+      /^milestone_name:\s*Notifications\s*$/m,
+      'frontmatter milestone_name not switched',
+    );
+    assert.match(after, /^status:\s*planning\s*$/m, 'status not reset to planning');
+    // Progress counters reset to zero.
+    assert.match(after, /^\s*completed_phases:\s*0\s*$/m, 'completed_phases not reset');
+    assert.match(after, /^\s*completed_plans:\s*0\s*$/m, 'completed_plans not reset');
+    assert.match(after, /^\s*percent:\s*0\s*$/m, 'percent not reset');
+
+    // Body Current Position reset to the new-milestone template.
+    assert.match(after, /Status:\s*Defining requirements/, 'body Status not reset');
+    assert.match(
+      after,
+      /Phase:\s*Not started \(defining requirements\)/,
+      'body Phase not reset',
+    );
+
+    // Accumulated Context is preserved.
+    assert.match(after, /\[Phase 1\]:\s*Use Node 20/, 'Accumulated Context lost');
+  });
+
+  test('rejects missing --milestone', () => {
+    const result = runGsdTools(
+      ['state', 'milestone-switch', '--name', 'Something'],
+      tmpDir,
+    );
+    // gsd-tools emits JSON with { error: ... } to stdout even on error paths.
+    const combined = (result.output || '') + (result.error || '');
+    assert.match(combined, /milestone required/i);
+  });
+});