diff --git a/ui/src/components/MarkdownBody.tsx b/ui/src/components/MarkdownBody.tsx
index b996629a..d9a2afb6 100644
--- a/ui/src/components/MarkdownBody.tsx
+++ b/ui/src/components/MarkdownBody.tsx
@@ -4,6 +4,7 @@ import remarkGfm from "remark-gfm";
 import { parseProjectMentionHref } from "@paperclipai/shared";
 import { cn } from "../lib/utils";
 import { useTheme } from "../context/ThemeContext";
+import { normalizeMarkdownArtifacts } from "../lib/markdown";
 
 interface MarkdownBodyProps {
   children: string;
@@ -114,6 +115,7 @@ function MermaidDiagramBlock({ source, darkMode }: { source: string; darkMode: b
 
 export function MarkdownBody({ children, className }: MarkdownBodyProps) {
   const { theme } = useTheme();
+  const normalizedMarkdown = normalizeMarkdownArtifacts(children);
   return (
     <div
       className={cn(
@@ -154,7 +156,7 @@ export function MarkdownBody({ children, className }: MarkdownBodyProps) {
           },
         }}
       >
-        {children}
+        {normalizedMarkdown}
       </Markdown>
     </div>
   );
diff --git a/ui/src/components/MarkdownEditor.tsx b/ui/src/components/MarkdownEditor.tsx
index 85b67c32..507308a1 100644
--- a/ui/src/components/MarkdownEditor.tsx
+++ b/ui/src/components/MarkdownEditor.tsx
@@ -29,6 +29,7 @@ import {
 } from "@mdxeditor/editor";
 import { buildProjectMentionHref, parseProjectMentionHref } from "@paperclipai/shared";
 import { cn } from "../lib/utils";
+import { normalizeMarkdownArtifacts } from "../lib/markdown";
 
 /* ---- Mention types ---- */
 
@@ -203,7 +204,7 @@ export const MarkdownEditor = forwardRef<MarkdownEditorRef, MarkdownEditorProps>
 }: MarkdownEditorProps, forwardedRef) {
   const containerRef = useRef<HTMLDivElement>(null);
   const ref = useRef<MDXEditorMethods>(null);
-  const latestValueRef = useRef(value);
+  const latestValueRef = useRef(normalizeMarkdownArtifacts(value));
   const [uploadError, setUploadError] = useState<string | null>(null);
   const [isDragOver, setIsDragOver] = useState(false);
   const dragDepthRef = useRef(0);
@@ -281,9 +282,10 @@ export const MarkdownEditor = forwardRef<MarkdownEditorRef, MarkdownEditorProps>
   }, [hasImageUpload]);
 
   useEffect(() => {
-    if (value !== latestValueRef.current) {
-      ref.current?.setMarkdown(value);
-      latestValueRef.current = value;
+    const normalizedValue = normalizeMarkdownArtifacts(value);
+    if (normalizedValue !== latestValueRef.current) {
+      ref.current?.setMarkdown(normalizedValue);
+      latestValueRef.current = normalizedValue;
     }
   }, [value]);
 
@@ -554,11 +556,15 @@ export const MarkdownEditor = forwardRef<MarkdownEditorRef, MarkdownEditorProps>
     >
       <MDXEditor
         ref={ref}
-        markdown={value}
+        markdown={normalizeMarkdownArtifacts(value)}
         placeholder={placeholder}
         onChange={(next) => {
-          latestValueRef.current = next;
-          onChange(next);
+          const normalizedNext = normalizeMarkdownArtifacts(next);
+          latestValueRef.current = normalizedNext;
+          if (normalizedNext !== next) {
+            ref.current?.setMarkdown(normalizedNext);
+          }
+          onChange(normalizedNext);
         }}
         onBlur={() => onBlur?.()}
         className={cn("paperclip-mdxeditor", !bordered && "paperclip-mdxeditor--borderless")}
diff --git a/ui/src/lib/markdown.test.ts b/ui/src/lib/markdown.test.ts
new file mode 100644
index 00000000..a455ea1f
--- /dev/null
+++ b/ui/src/lib/markdown.test.ts
@@ -0,0 +1,20 @@
+import { describe, expect, it } from "vitest";
+import { normalizeMarkdownArtifacts } from "./markdown";
+
+describe("normalizeMarkdownArtifacts", () => {
+  it("normalizes escaped unordered list markers and space entities", () => {
+    const input = "Here is a list:\n\n\\* foo&#x20;\n\\- bar&#x20;";
+    const output = normalizeMarkdownArtifacts(input);
+    expect(output).toBe("Here is a list:\n\n* foo \n- bar ");
+  });
+
+  it("does not rewrite escaped markers inside fenced code blocks", () => {
+    const input = "```md\n\\* keep literal&#x20;\n\\- keep literal&#x20;\n```";
+    expect(normalizeMarkdownArtifacts(input)).toBe(input);
+  });
+
+  it("keeps escaped non-list syntax intact", () => {
+    const input = "\\*not-a-list";
+    expect(normalizeMarkdownArtifacts(input)).toBe(input);
+  });
+});
diff --git a/ui/src/lib/markdown.ts b/ui/src/lib/markdown.ts
new file mode 100644
index 00000000..ab485319
--- /dev/null
+++ b/ui/src/lib/markdown.ts
@@ -0,0 +1,47 @@
+const FENCE_RE = /^\s*(`{3,}|~{3,})/;
+const SPACE_ENTITY_RE = /&#x20;/gi;
+const ESCAPED_UNORDERED_LIST_RE = /^(\s{0,3})\\([*+-])([ \t]+)/;
+
+/**
+ * Normalize markdown artifacts emitted by rich-text serialization so
+ * plain markdown list syntax remains usable in Paperclip editors.
+ */
+export function normalizeMarkdownArtifacts(markdown: string): string {
+  if (!markdown) return markdown;
+
+  const lines = markdown.split(/\r?\n/);
+  let inFence = false;
+  let fenceMarker: "`" | "~" | null = null;
+  let fenceLength = 0;
+  let changed = false;
+
+  const normalized = lines.map((line) => {
+    const fenceMatch = FENCE_RE.exec(line);
+    if (fenceMatch) {
+      const marker = fenceMatch[1];
+      if (!inFence) {
+        inFence = true;
+        fenceMarker = marker[0] as "`" | "~";
+        fenceLength = marker.length;
+      } else if (marker[0] === fenceMarker && marker.length >= fenceLength) {
+        inFence = false;
+        fenceMarker = null;
+        fenceLength = 0;
+      }
+      return line;
+    }
+
+    if (inFence) return line;
+
+    let next = line;
+    if (next.includes("&#x20;")) {
+      next = next.replace(SPACE_ENTITY_RE, " ");
+    }
+    const unescaped = next.replace(ESCAPED_UNORDERED_LIST_RE, "$1$2$3");
+    if (unescaped !== line) changed = true;
+    return unescaped;
+  });
+
+  if (!changed) return markdown;
+  return normalized.join("\n");
+}