diff --git a/ui/src/components/IssueReferenceActivitySummary.tsx b/ui/src/components/IssueReferenceActivitySummary.tsx
index 153db735da3..062985c5348 100644
--- a/ui/src/components/IssueReferenceActivitySummary.tsx
+++ b/ui/src/components/IssueReferenceActivitySummary.tsx
@@ -1,4 +1,5 @@
 import type { ActivityEvent } from "@paperclipai/shared";
+import { Plus, Minus } from "lucide-react";
 import { IssueReferencePill } from "./IssueReferencePill";
 
 type ActivityIssueReference = {
@@ -13,14 +14,31 @@ function readIssueReferences(details: Record<string, unknown> | null | undefined
   return value.filter((item): item is ActivityIssueReference => !!item && typeof item === "object");
 }
 
-function Section({ label, items }: { label: string; items: ActivityIssueReference[] }) {
+function Section({
+  label,
+  icon,
+  items,
+  strikethrough,
+}: {
+  label: string;
+  icon: React.ReactNode;
+  items: ActivityIssueReference[];
+  strikethrough?: boolean;
+}) {
   if (items.length === 0) return null;
   return (
     <div className="flex flex-wrap items-center gap-1.5">
-      <span className="text-[10px] font-medium uppercase tracking-[0.14em] text-muted-foreground">{label}</span>
+      <span
+        aria-label={label}
+        className="inline-flex items-center gap-1 text-xs text-muted-foreground"
+      >
+        {icon}
+        <span className="sr-only">{label}</span>
+      </span>
       {items.map((issue) => (
         <IssueReferencePill
           key={`${label}:${issue.id}`}
+          strikethrough={strikethrough}
           issue={{
             id: issue.id,
             identifier: issue.identifier ?? null,
@@ -39,8 +57,17 @@ export function IssueReferenceActivitySummary({ event }: { event: Pick<ActivityE
 
   return (
     <div className="mt-2 space-y-1">
-      <Section label="Added" items={added} />
-      <Section label="Removed" items={removed} />
+      <Section
+        label="Added references"
+        icon={<Plus className="h-3 w-3 text-green-600 dark:text-green-400" aria-hidden="true" />}
+        items={added}
+      />
+      <Section
+        label="Removed references"
+        icon={<Minus className="h-3 w-3 text-red-600 dark:text-red-400" aria-hidden="true" />}
+        items={removed}
+        strikethrough
+      />
     </div>
   );
 }
diff --git a/ui/src/components/IssueReferencePill.tsx b/ui/src/components/IssueReferencePill.tsx
index b2a74728788..cf3d269743e 100644
--- a/ui/src/components/IssueReferencePill.tsx
+++ b/ui/src/components/IssueReferencePill.tsx
@@ -1,12 +1,16 @@
 import type { IssueRelationIssueSummary } from "@paperclipai/shared";
 import { Link } from "@/lib/router";
 import { cn } from "../lib/utils";
+import { StatusIcon } from "./StatusIcon";
 
 export function IssueReferencePill({
   issue,
+  strikethrough,
   className,
 }: {
-  issue: Pick<IssueRelationIssueSummary, "id" | "identifier" | "title">;
+  issue: Pick<IssueRelationIssueSummary, "id" | "identifier" | "title"> &
+    Partial<Pick<IssueRelationIssueSummary, "status">>;
+  strikethrough?: boolean;
   className?: string;
 }) {
   const issueLabel = issue.identifier ?? issue.id;
@@ -14,14 +18,22 @@ export function IssueReferencePill({
   return (
     <Link
       to={`/issues/${issueLabel}`}
+      data-mention-kind="issue"
       className={cn(
-        "inline-flex items-center gap-1 rounded-full border border-border px-2 py-0.5 text-xs hover:bg-accent/50",
+        "paperclip-mention-chip paperclip-mention-chip--issue",
+        "inline-flex items-center gap-1 rounded-full border border-border px-2 py-0.5 text-xs no-underline",
+        "hover:bg-accent/50 focus-visible:outline-none focus-visible:ring-[3px] focus-visible:ring-ring",
+        strikethrough && "opacity-60 line-through decoration-muted-foreground",
         className,
       )}
       title={issue.title}
       aria-label={`Issue ${issueLabel}: ${issue.title}`}
     >
-      <span className="h-1.5 w-1.5 rounded-[0.2rem] bg-current opacity-70" />
+      {issue.status ? (
+        <StatusIcon status={issue.status} className="h-3 w-3 shrink-0" />
+      ) : (
+        <span className="h-1.5 w-1.5 rounded-[0.14rem] bg-current opacity-70" />
+      )}
       <span>{issue.identifier ?? issue.title}</span>
     </Link>
   );
diff --git a/ui/src/components/IssueRelatedWorkPanel.test.tsx b/ui/src/components/IssueRelatedWorkPanel.test.tsx
index f2ca0493dee..d1bd505f3ed 100644
--- a/ui/src/components/IssueRelatedWorkPanel.test.tsx
+++ b/ui/src/components/IssueRelatedWorkPanel.test.tsx
@@ -60,4 +60,37 @@ describe("IssueRelatedWorkPanel", () => {
     expect(html).toContain("plan");
     expect(html).toContain("comment");
   });
+
+  it("collapses duplicate source labels into a single chip with a count", () => {
+    const html = renderToStaticMarkup(
+      <IssueRelatedWorkPanel
+        relatedWork={{
+          outbound: [],
+          inbound: [
+            {
+              issue: {
+                id: "issue-4",
+                identifier: "PAP-44",
+                title: "Chatty inbound",
+                status: "in_progress",
+                priority: "medium",
+                assigneeAgentId: null,
+                assigneeUserId: null,
+              },
+              mentionCount: 3,
+              sources: [
+                { kind: "comment", sourceRecordId: "c1", label: "comment", matchedText: "PAP-44 first" },
+                { kind: "comment", sourceRecordId: "c2", label: "comment", matchedText: "PAP-44 second" },
+                { kind: "comment", sourceRecordId: "c3", label: "comment", matchedText: "PAP-44 third" },
+              ],
+            },
+          ],
+        }}
+      />,
+    );
+
+    const commentMatches = html.match(/>comment</g) ?? [];
+    expect(commentMatches).toHaveLength(1);
+    expect(html).toContain("×3");
+  });
 });
diff --git a/ui/src/components/IssueRelatedWorkPanel.tsx b/ui/src/components/IssueRelatedWorkPanel.tsx
index c5b497f65a0..0e5bcd8d792 100644
--- a/ui/src/components/IssueRelatedWorkPanel.tsx
+++ b/ui/src/components/IssueRelatedWorkPanel.tsx
@@ -1,6 +1,29 @@
 import type { IssueRelatedWorkItem, IssueRelatedWorkSummary } from "@paperclipai/shared";
 import { IssueReferencePill } from "./IssueReferencePill";
 
+type GroupedSource = {
+  label: string;
+  count: number;
+  sampleMatchedText: string | null;
+};
+
+function groupSourcesByLabel(sources: IssueRelatedWorkItem["sources"]): GroupedSource[] {
+  const groups = new Map<string, GroupedSource>();
+  for (const source of sources) {
+    const existing = groups.get(source.label);
+    if (existing) {
+      existing.count += 1;
+    } else {
+      groups.set(source.label, {
+        label: source.label,
+        count: 1,
+        sampleMatchedText: source.matchedText ?? null,
+      });
+    }
+  }
+  return Array.from(groups.values());
+}
+
 function Section({
   title,
   description,
@@ -15,39 +38,46 @@ function Section({
   return (
     <section className="space-y-3 rounded-lg border border-border p-3">
       <div className="space-y-1">
-        <h3 className="text-sm font-medium">{title}</h3>
+        <h3 className="text-sm font-semibold">{title}</h3>
         <p className="text-xs text-muted-foreground">{description}</p>
       </div>
 
       {items.length === 0 ? (
         <p className="text-xs text-muted-foreground">{emptyLabel}</p>
       ) : (
-        <div className="space-y-2">
-          {items.map((item) => (
-            <div key={item.issue.id} className="space-y-2 rounded-md border border-border/60 px-3 py-2">
-              <div className="flex flex-wrap items-center gap-2">
+        <ul className="-mx-1 flex flex-col">
+          {items.map((item) => {
+            const groupedSources = groupSourcesByLabel(item.sources);
+            const showTitle = item.issue.identifier !== item.issue.title;
+            return (
+              <li
+                key={item.issue.id}
+                className="flex flex-wrap items-center gap-x-2 gap-y-1.5 rounded-md px-1 py-1.5 hover:bg-accent/40"
+              >
                 <IssueReferencePill issue={item.issue} />
-                {item.issue.identifier !== item.issue.title ? (
-                  <span className="text-sm text-muted-foreground">{item.issue.title}</span>
-                ) : null}
-                <span className="ml-auto text-[11px] uppercase tracking-[0.12em] text-muted-foreground">
-                  {item.mentionCount} source{item.mentionCount === 1 ? "" : "s"}
-                </span>
-              </div>
-              <div className="flex flex-wrap gap-1.5">
-                {item.sources.map((source) => (
-                  <span
-                    key={`${item.issue.id}:${source.kind}:${source.sourceRecordId ?? "root"}`}
-                    className="inline-flex items-center rounded-full border border-border bg-muted/40 px-2 py-0.5 text-[11px] text-muted-foreground"
-                    title={source.matchedText ?? undefined}
-                  >
-                    {source.label}
+                {showTitle ? (
+                  <span className="min-w-0 flex-1 truncate text-sm text-muted-foreground">
+                    {item.issue.title}
                   </span>
-                ))}
-              </div>
-            </div>
-          ))}
-        </div>
+                ) : null}
+                <div className="flex flex-wrap items-center gap-1.5">
+                  {groupedSources.map((group) => (
+                    <span
+                      key={`${item.issue.id}:${group.label}`}
+                      className="inline-flex items-center gap-1 rounded-full border border-border bg-muted/40 px-2 py-0.5 text-xs text-muted-foreground"
+                      title={group.sampleMatchedText ?? undefined}
+                    >
+                      <span>{group.label}</span>
+                      {group.count > 1 ? (
+                        <span className="tabular-nums text-[10px] font-medium opacity-80">×{group.count}</span>
+                      ) : null}
+                    </span>
+                  ))}
+                </div>
+              </li>
+            );
+          })}
+        </ul>
       )}
     </section>
   );
diff --git a/ui/src/pages/DesignGuide.tsx b/ui/src/pages/DesignGuide.tsx
index 9d4ab867f4d..656fcead050 100644
--- a/ui/src/pages/DesignGuide.tsx
+++ b/ui/src/pages/DesignGuide.tsx
@@ -123,6 +123,7 @@ import { FilterBar, type FilterValue } from "@/components/FilterBar";
 import { InlineEditor } from "@/components/InlineEditor";
 import { PageSkeleton } from "@/components/PageSkeleton";
 import { Identity } from "@/components/Identity";
+import { IssueReferencePill } from "@/components/IssueReferencePill";
 
 /* ------------------------------------------------------------------ */
 /*  Section wrapper                                                    */
@@ -466,6 +467,21 @@ export function DesignGuide() {
             ))}
           </div>
         </SubSection>
+
+        <SubSection title="IssueReferencePill">
+          <p className="text-xs text-muted-foreground">
+            Used wherever a task is referenced — in markdown, the Related Work tab, and activity summaries.
+            Pass <code className="font-mono">status</code> to show the target issue&apos;s state at a glance.
+            Use <code className="font-mono">strikethrough</code> for &quot;removed&quot; contexts.
+          </p>
+          <div className="flex items-center gap-2 flex-wrap">
+            <IssueReferencePill issue={{ id: "demo-1", identifier: "PAP-123", title: "Identifier only — no status yet" }} />
+            <IssueReferencePill issue={{ id: "demo-2", identifier: "PAP-456", title: "With in_progress status", status: "in_progress" }} />
+            <IssueReferencePill issue={{ id: "demo-3", identifier: "PAP-789", title: "Done status", status: "done" }} />
+            <IssueReferencePill issue={{ id: "demo-4", identifier: "PAP-101", title: "Blocked status", status: "blocked" }} />
+            <IssueReferencePill strikethrough issue={{ id: "demo-5", identifier: "PAP-202", title: "Removed (strikethrough)", status: "todo" }} />
+          </div>
+        </SubSection>
       </Section>
 
       {/* ============================================================ */}