diff --git a/internal/llm/agent/mcp-tools.go b/internal/llm/agent/mcp-tools.go
index f5125c8b89f2dda534396f3c51df3839390022ce..ebd1698f2f7bf45ecda15c9160464e3d295ce3d6 100644
--- a/internal/llm/agent/mcp-tools.go
+++ b/internal/llm/agent/mcp-tools.go
@@ -341,29 +341,32 @@ func createAndInitializeClient(ctx context.Context, name string, m config.MCPCon
 		return nil, err
 	}
 
+	// XXX: ideally we should be able to use context.WithTimeout here, but,
+	// the SSE MCP client will start failing once that context is canceled.
 	timeout := mcpTimeout(m)
-	initCtx, cancel := context.WithTimeout(ctx, timeout)
-	defer cancel()
-
-	if err := c.Start(initCtx); err != nil {
+	mcpCtx, cancel := context.WithCancel(ctx)
+	cancelTimer := time.AfterFunc(timeout, cancel)
+	if err := c.Start(mcpCtx); err != nil {
 		updateMCPState(name, MCPStateError, maybeTimeoutErr(err, timeout), nil, 0)
 		slog.Error("error starting mcp client", "error", err, "name", name)
 		_ = c.Close()
+		cancel()
 		return nil, err
 	}
-	if _, err := c.Initialize(initCtx, mcpInitRequest); err != nil {
+	if _, err := c.Initialize(mcpCtx, mcpInitRequest); err != nil {
 		updateMCPState(name, MCPStateError, maybeTimeoutErr(err, timeout), nil, 0)
 		slog.Error("error initializing mcp client", "error", err, "name", name)
 		_ = c.Close()
+		cancel()
 		return nil, err
 	}
-
+	cancelTimer.Stop()
 	slog.Info("Initialized mcp client", "name", name)
 	return c, nil
 }
 
 func maybeTimeoutErr(err error, timeout time.Duration) error {
-	if errors.Is(err, context.DeadlineExceeded) {
+	if errors.Is(err, context.Canceled) {
 		return fmt.Errorf("timed out after %s", timeout)
 	}
 	return err