diff --git a/src/modes/agent/parse-tools.ts b/src/modes/agent/parse-tools.ts
index 9b2fdcb..128ce07 100644
--- a/src/modes/agent/parse-tools.ts
+++ b/src/modes/agent/parse-tools.ts
@@ -1,22 +1,55 @@
-export function parseAllowedTools(claudeArgs: string): string[] {
-  // Match --allowedTools or --allowed-tools followed by the value
-  // Handle both quoted and unquoted values
-  const patterns = [
-    /--(?:allowedTools|allowed-tools)\s+"([^"]+)"/, // Double quoted
-    /--(?:allowedTools|allowed-tools)\s+'([^']+)'/, // Single quoted
-    /--(?:allowedTools|allowed-tools)\s+([^\s]+)/, // Unquoted
-  ];
+import { parse as parseShellArgs, type ParseEntry } from "shell-quote";
 
-  for (const pattern of patterns) {
-    const match = claudeArgs.match(pattern);
-    if (match && match[1]) {
-      // Don't return if the value starts with -- (another flag)
-      if (match[1].startsWith("--")) {
-        return [];
+/**
+ * Extract the string value from a shell-quote ParseEntry.
+ * Handles both plain strings and glob patterns (which are returned as objects).
+ */
+function entryToString(entry: ParseEntry): string | null {
+  if (typeof entry === "string") {
+    return entry;
+  }
+  // Handle glob patterns - shell-quote returns { op: "glob", pattern: "..." }
+  if (typeof entry === "object" && "op" in entry && entry.op === "glob") {
+    return (entry as { op: "glob"; pattern: string }).pattern;
+  }
+  return null;
+}
+
+export function parseAllowedTools(claudeArgs: string): string[] {
+  if (!claudeArgs?.trim()) return [];
+
+  const result: string[] = [];
+
+  // Use shell-quote to properly tokenize the arguments
+  // This handles quoted strings, escaped characters, etc.
+  const rawArgs = parseShellArgs(claudeArgs);
+
+  for (let i = 0; i < rawArgs.length; i++) {
+    const entry = rawArgs[i];
+    if (!entry) continue;
+    const arg = entryToString(entry);
+    if (!arg) continue;
+
+    // Match both --allowedTools and --allowed-tools
+    if (arg === "--allowedTools" || arg === "--allowed-tools") {
+      // Collect all subsequent non-flag values as tools
+      while (i + 1 < rawArgs.length) {
+        const nextEntry = rawArgs[i + 1];
+        if (!nextEntry) break;
+        const toolArg = entryToString(nextEntry);
+
+        // Stop if we hit another flag or a non-parseable entry
+        if (!toolArg || toolArg.startsWith("--")) {
+          break;
+        }
+
+        // Split by comma in case tools are comma-separated within a single value
+        const tools = toolArg.split(",").map((t) => t.trim());
+        result.push(...tools.filter((t) => t.length > 0));
+        i++;
       }
-      return match[1].split(",").map((t) => t.trim());
     }
   }
 
-  return [];
+  return result;
 }
diff --git a/test/modes/parse-tools.test.ts b/test/modes/parse-tools.test.ts
index e88e800..dd1fa32 100644
--- a/test/modes/parse-tools.test.ts
+++ b/test/modes/parse-tools.test.ts
@@ -37,8 +37,9 @@ describe("parseAllowedTools", () => {
 
   test("handles duplicate --allowedTools flags", () => {
     const args = "--allowedTools --allowedTools mcp__github__*";
-    // Should not match the first one since the value is another flag
-    expect(parseAllowedTools(args)).toEqual([]);
+    // Should skip the first one since the value is another flag
+    // and parse the second one correctly
+    expect(parseAllowedTools(args)).toEqual(["mcp__github__*"]);
   });
 
   test("handles typo --alloedTools", () => {
@@ -84,4 +85,50 @@ describe("parseAllowedTools", () => {
       "mcp__github_comment__*",
     ]);
   });
+
+  test("parses multiple space-separated quoted tools (issue #746)", () => {
+    // This is the exact format from the bug report
+    const args =
+      '--allowed-tools "Bash(git log:*)" "Bash(git diff:*)" "Bash(git fetch:*)" "Bash(gh pr:*)"';
+    expect(parseAllowedTools(args)).toEqual([
+      "Bash(git log:*)",
+      "Bash(git diff:*)",
+      "Bash(git fetch:*)",
+      "Bash(gh pr:*)",
+    ]);
+  });
+
+  test("parses multiple --allowedTools flags with different tools", () => {
+    const args =
+      '--allowedTools "Edit,Read" --model "claude-3" --allowedTools "Bash(npm install)"';
+    expect(parseAllowedTools(args)).toEqual([
+      "Edit",
+      "Read",
+      "Bash(npm install)",
+    ]);
+  });
+
+  test("parses mix of comma-separated and space-separated tools", () => {
+    const args =
+      '--allowed-tools "Bash(git log:*),Bash(git diff:*)" "Bash(git fetch:*)"';
+    expect(parseAllowedTools(args)).toEqual([
+      "Bash(git log:*)",
+      "Bash(git diff:*)",
+      "Bash(git fetch:*)",
+    ]);
+  });
+
+  test("handles complex workflow example from issue #746", () => {
+    const args =
+      '--allowed-tools "Bash(git log:*)" "Bash(git diff:*)" "Bash(git fetch:*)" "Bash(git reflog:*)" "Bash(git merge-tree:*)" "Bash(gh pr:*)" "Bash(gh api:*)"';
+    expect(parseAllowedTools(args)).toEqual([
+      "Bash(git log:*)",
+      "Bash(git diff:*)",
+      "Bash(git fetch:*)",
+      "Bash(git reflog:*)",
+      "Bash(git merge-tree:*)",
+      "Bash(gh pr:*)",
+      "Bash(gh api:*)",
+    ]);
+  });
 });