diff --git a/src/lib/services/clients.service.ts b/src/lib/services/clients.service.ts
index f99627a4..8686cd46 100644
--- a/src/lib/services/clients.service.ts
+++ b/src/lib/services/clients.service.ts
@@ -24,7 +24,11 @@ import { buildListQuery } from '@/lib/db/query-builder';
 import { diffEntity } from '@/lib/entity-diff';
 import { softDelete, restore, withTransaction } from '@/lib/db/utils';
 import { logger } from '@/lib/logger';
-import { syncEntityFolderName } from '@/lib/services/document-folders.service';
+import {
+  syncEntityFolderName,
+  applyEntityArchivedSuffix,
+  applyEntityRestoredSuffix,
+} from '@/lib/services/document-folders.service';
 import type {
   CreateClientInput,
   UpdateClientInput,
@@ -553,6 +557,10 @@ export async function archiveClient(id: string, portId: string, meta: AuditMeta)
 
   await softDelete(clients, clients.id, id);
 
+  void applyEntityArchivedSuffix(portId, 'client', id).catch((err) => {
+    logger.warn({ err, clientId: id }, 'Failed to apply archived suffix to client folder');
+  });
+
   void createAuditLog({
     userId: meta.userId,
     portId,
@@ -581,6 +589,10 @@ export async function restoreClient(id: string, portId: string, meta: AuditMeta)
 
   await restore(clients, clients.id, id);
 
+  void applyEntityRestoredSuffix(portId, 'client', id).catch((err) => {
+    logger.warn({ err, clientId: id }, 'Failed to clear archived suffix on client folder');
+  });
+
   void createAuditLog({
     userId: meta.userId,
     portId,
diff --git a/src/lib/services/companies.service.ts b/src/lib/services/companies.service.ts
index 6bf69230..ab04ab1c 100644
--- a/src/lib/services/companies.service.ts
+++ b/src/lib/services/companies.service.ts
@@ -13,7 +13,10 @@ import { buildListQuery } from '@/lib/db/query-builder';
 import { createAuditLog, type AuditMeta } from '@/lib/audit';
 import { NotFoundError, ConflictError } from '@/lib/errors';
 import { logger } from '@/lib/logger';
-import { syncEntityFolderName } from '@/lib/services/document-folders.service';
+import {
+  syncEntityFolderName,
+  applyEntityArchivedSuffix,
+} from '@/lib/services/document-folders.service';
 import { emitToRoom } from '@/lib/socket/server';
 import { setEntityTags } from '@/lib/services/entity-tags.helper';
 import { diffEntity } from '@/lib/entity-diff';
@@ -212,6 +215,10 @@ export async function archiveCompany(id: string, portId: string, meta: AuditMeta
     .set({ archivedAt: new Date() })
     .where(and(eq(companies.id, id), eq(companies.portId, portId)));
 
+  void applyEntityArchivedSuffix(portId, 'company', id).catch((err) => {
+    logger.warn({ err, companyId: id }, 'Failed to apply archived suffix to company folder');
+  });
+
   void createAuditLog({
     userId: meta.userId,
     portId,
diff --git a/src/lib/services/document-folders.service.ts b/src/lib/services/document-folders.service.ts
index 1988b882..f23917bb 100644
--- a/src/lib/services/document-folders.service.ts
+++ b/src/lib/services/document-folders.service.ts
@@ -571,3 +571,107 @@ export async function syncEntityFolderName(
   }
   throw new ConflictError(`Could not allocate a unique folder name for ${baseName}`);
 }
+
+// ─── Archive / Restore / Demote helpers ──────────────────────────────────────
+
+const ARCHIVED_SUFFIX = ' (archived)';
+const DELETED_SUFFIX = ' (deleted)';
+
+/**
+ * Stamp an entity's subfolder as archived: append " (archived)" to the
+ * name (idempotent — won't double-append) and set archived_at. No-op
+ * when the folder does not exist (lazy creation). Used by the entity
+ * archive paths in clients / companies / yachts services.
+ */
+export async function applyEntityArchivedSuffix(
+  portId: string,
+  entityType: EntityType,
+  entityId: string,
+): Promise<void> {
+  if (!ENTITY_TYPES.has(entityType)) return;
+  const folder = await db.query.documentFolders.findFirst({
+    where: and(
+      eq(documentFolders.portId, portId),
+      eq(documentFolders.entityType, entityType),
+      eq(documentFolders.entityId, entityId),
+    ),
+  });
+  if (!folder) return;
+  const newName = folder.name.endsWith(ARCHIVED_SUFFIX)
+    ? folder.name
+    : `${folder.name}${ARCHIVED_SUFFIX}`;
+  await db
+    .update(documentFolders)
+    .set({ name: newName, archivedAt: new Date(), updatedAt: new Date() })
+    .where(and(eq(documentFolders.id, folder.id), eq(documentFolders.portId, portId)));
+}
+
+/**
+ * Inverse of `applyEntityArchivedSuffix` — strip " (archived)" from
+ * the name and clear archived_at. No-op when the folder does not
+ * exist or wasn't archived.
+ */
+export async function applyEntityRestoredSuffix(
+  portId: string,
+  entityType: EntityType,
+  entityId: string,
+): Promise<void> {
+  if (!ENTITY_TYPES.has(entityType)) return;
+  const folder = await db.query.documentFolders.findFirst({
+    where: and(
+      eq(documentFolders.portId, portId),
+      eq(documentFolders.entityType, entityType),
+      eq(documentFolders.entityId, entityId),
+    ),
+  });
+  if (!folder) return;
+  const newName = folder.name.endsWith(ARCHIVED_SUFFIX)
+    ? folder.name.slice(0, -ARCHIVED_SUFFIX.length)
+    : folder.name;
+  await db
+    .update(documentFolders)
+    .set({ name: newName, archivedAt: null, updatedAt: new Date() })
+    .where(and(eq(documentFolders.id, folder.id), eq(documentFolders.portId, portId)));
+}
+
+/**
+ * Entity has been hard-deleted: demote the folder to a regular user
+ * folder by clearing `system_managed`, appending " (deleted)" to the
+ * name, and dropping the entity FK so the partial unique index no
+ * longer constrains it. Files still inside the folder retain their
+ * snapshotted entity FKs (orphaned — they appear in the root-view
+ * Files section once the rep cleans up).
+ *
+ * Idempotent: re-demoting an already-demoted folder is a no-op because
+ * the entityType + entityId FK is cleared on first demotion.
+ */
+export async function demoteSystemFolderOnEntityDelete(
+  portId: string,
+  entityType: EntityType,
+  entityId: string,
+): Promise<void> {
+  if (!ENTITY_TYPES.has(entityType)) return;
+  const folder = await db.query.documentFolders.findFirst({
+    where: and(
+      eq(documentFolders.portId, portId),
+      eq(documentFolders.entityType, entityType),
+      eq(documentFolders.entityId, entityId),
+    ),
+  });
+  if (!folder) return;
+  const stripped = folder.name.endsWith(ARCHIVED_SUFFIX)
+    ? folder.name.slice(0, -ARCHIVED_SUFFIX.length)
+    : folder.name;
+  const newName = stripped.endsWith(DELETED_SUFFIX) ? stripped : `${stripped}${DELETED_SUFFIX}`;
+  await db
+    .update(documentFolders)
+    .set({
+      name: newName,
+      systemManaged: false,
+      entityType: null,
+      entityId: null,
+      archivedAt: null,
+      updatedAt: new Date(),
+    })
+    .where(and(eq(documentFolders.id, folder.id), eq(documentFolders.portId, portId)));
+}
diff --git a/src/lib/services/yachts.service.ts b/src/lib/services/yachts.service.ts
index c6cd2f0b..3551eb24 100644
--- a/src/lib/services/yachts.service.ts
+++ b/src/lib/services/yachts.service.ts
@@ -6,7 +6,10 @@ import { companies } from '@/lib/db/schema/companies';
 import { createAuditLog, type AuditMeta } from '@/lib/audit';
 import { NotFoundError, ValidationError } from '@/lib/errors';
 import { logger } from '@/lib/logger';
-import { syncEntityFolderName } from '@/lib/services/document-folders.service';
+import {
+  syncEntityFolderName,
+  applyEntityArchivedSuffix,
+} from '@/lib/services/document-folders.service';
 import { emitToRoom } from '@/lib/socket/server';
 import { setEntityTags } from '@/lib/services/entity-tags.helper';
 import { diffEntity } from '@/lib/entity-diff';
@@ -190,6 +193,10 @@ export async function archiveYacht(id: string, portId: string, meta: AuditMeta)
     .set({ archivedAt: new Date() })
     .where(and(eq(yachts.id, id), eq(yachts.portId, portId)));
 
+  void applyEntityArchivedSuffix(portId, 'yacht', id).catch((err) => {
+    logger.warn({ err, yachtId: id }, 'Failed to apply archived suffix to yacht folder');
+  });
+
   void createAuditLog({
     userId: meta.userId,
     portId,
diff --git a/tests/unit/document-folders-system-folders.test.ts b/tests/unit/document-folders-system-folders.test.ts
index 22299ada..a146a880 100644
--- a/tests/unit/document-folders-system-folders.test.ts
+++ b/tests/unit/document-folders-system-folders.test.ts
@@ -139,6 +139,9 @@ import {
   moveFolder,
   renameFolder,
   syncEntityFolderName,
+  applyEntityArchivedSuffix,
+  applyEntityRestoredSuffix,
+  demoteSystemFolderOnEntityDelete,
 } from '@/lib/services/document-folders.service';
 
 describe('document-folders service · system folder protection', () => {
@@ -252,3 +255,78 @@ describe('document-folders service · syncEntityFolderName', () => {
     expect(folder?.name).toBe(`${sharedName} (2)`);
   });
 });
+
+describe('document-folders service · archive lifecycle', () => {
+  let portId: string;
+  let clientId: string;
+  let clientName: string;
+
+  beforeEach(async () => {
+    const port = await makePort();
+    portId = port.id;
+    await db.delete(documentFolders).where(eq(documentFolders.portId, portId));
+    await ensureSystemRoots(portId, TEST_USER_ID);
+    clientName = `John Smith ${crypto.randomUUID().slice(0, 6)}`;
+    const [client] = await db
+      .insert(clients)
+      .values({ portId, fullName: clientName })
+      .returning();
+    clientId = client!.id;
+    await ensureEntityFolder(portId, 'client', clientId, TEST_USER_ID);
+  });
+
+  it('appends (archived) suffix and stamps archived_at on archive', async () => {
+    await applyEntityArchivedSuffix(portId, 'client', clientId);
+    const folder = await db.query.documentFolders.findFirst({
+      where: and(eq(documentFolders.entityType, 'client'), eq(documentFolders.entityId, clientId)),
+    });
+    expect(folder?.name).toBe(`${clientName} (archived)`);
+    expect(folder?.archivedAt).toBeInstanceOf(Date);
+    expect(folder?.systemManaged).toBe(true);
+  });
+
+  it('is idempotent on archive — second call does not double-append', async () => {
+    await applyEntityArchivedSuffix(portId, 'client', clientId);
+    await applyEntityArchivedSuffix(portId, 'client', clientId);
+    const folder = await db.query.documentFolders.findFirst({
+      where: and(eq(documentFolders.entityType, 'client'), eq(documentFolders.entityId, clientId)),
+    });
+    expect(folder?.name).toBe(`${clientName} (archived)`);
+  });
+
+  it('removes (archived) suffix and clears archived_at on restore', async () => {
+    await applyEntityArchivedSuffix(portId, 'client', clientId);
+    await applyEntityRestoredSuffix(portId, 'client', clientId);
+    const folder = await db.query.documentFolders.findFirst({
+      where: and(eq(documentFolders.entityType, 'client'), eq(documentFolders.entityId, clientId)),
+    });
+    expect(folder?.name).toBe(clientName);
+    expect(folder?.archivedAt).toBeNull();
+  });
+
+  it('appends (deleted) and flips system_managed=false on hard-delete', async () => {
+    await demoteSystemFolderOnEntityDelete(portId, 'client', clientId);
+    // After demotion, entityType + entityId are cleared, so we look up by name.
+    const folder = await db.query.documentFolders.findFirst({
+      where: and(
+        eq(documentFolders.portId, portId),
+        eq(documentFolders.name, `${clientName} (deleted)`),
+      ),
+    });
+    expect(folder?.systemManaged).toBe(false);
+    expect(folder?.entityType).toBeNull();
+    expect(folder?.entityId).toBeNull();
+  });
+
+  it('is a no-op when the folder does not exist', async () => {
+    const otherPort = await makePort();
+    await ensureSystemRoots(otherPort.id, TEST_USER_ID);
+    const [other] = await db
+      .insert(clients)
+      .values({ portId: otherPort.id, fullName: `Lone Wolf ${crypto.randomUUID().slice(0, 6)}` })
+      .returning();
+    await expect(
+      applyEntityArchivedSuffix(otherPort.id, 'client', other!.id),
+    ).resolves.toBeUndefined();
+  });
+});