diff --git a/src/acp/connection.py b/src/acp/connection.py
index ff1cb19..1ca7763 100644
--- a/src/acp/connection.py
+++ b/src/acp/connection.py
@@ -58,6 +58,10 @@ class StreamEvent:
 StreamObserver = Callable[[StreamEvent], Awaitable[None] | None]
 
 
+class _OversizedLineSkipped(Exception):
+    """Raised after an oversized line has been discarded."""
+
+
 class Connection:
     """Minimal JSON-RPC 2.0 connection over newline-delimited JSON frames."""
 
@@ -153,7 +157,15 @@ async def send_notification(self, method: str, params: JsonValue | None = None)
     async def _receive_loop(self) -> None:
         try:
             while True:
-                line = await asyncio.wait_for(self._reader.readline(), timeout=self._receive_timeout)
+                try:
+                    line = await self._read_line()
+                except _OversizedLineSkipped:
+                    logging.warning(
+                        "Skipped oversized JSON-RPC frame that exceeded the StreamReader line limit. "
+                        "The connection will continue with subsequent frames. If large frames are expected, "
+                        "increase the StreamReader limit, for example via stdio_buffer_limit_bytes when using run_agent."
+                    )
+                    continue
                 if not line:
                     break
                 line = line.strip()
@@ -172,6 +184,36 @@ async def _receive_loop(self) -> None:
             raise RequestError.internal_error({"details": "Agent timeout"}) from None
         self._disconnect()
 
+    async def _read_line(self) -> bytes:
+        try:
+            return await self._wait_for_reader(self._reader.readuntil(b"\n"))
+        except asyncio.IncompleteReadError as exc:
+            return exc.partial
+        except asyncio.LimitOverrunError as exc:
+            await self._discard_oversized_line(exc.consumed)
+            raise _OversizedLineSkipped from exc
+
+    async def _discard_oversized_line(self, consumed: int) -> None:
+        while True:
+            if consumed <= 0:
+                consumed = 1
+            if consumed > 0:
+                try:
+                    await self._wait_for_reader(self._reader.readexactly(consumed))
+                except asyncio.IncompleteReadError:
+                    return
+            try:
+                await self._wait_for_reader(self._reader.readuntil(b"\n"))
+            except asyncio.IncompleteReadError:
+                return
+            except asyncio.LimitOverrunError as exc:
+                consumed = exc.consumed
+            else:
+                return
+
+    async def _wait_for_reader(self, awaitable: Awaitable[bytes]) -> bytes:
+        return await asyncio.wait_for(awaitable, timeout=self._receive_timeout)
+
     async def _process_message(self, message: dict[str, Any]) -> None:
         method = message.get("method")
         has_id = "id" in message
diff --git a/tests/real_user/test_stdio_limits.py b/tests/real_user/test_stdio_limits.py
index f972a8f..050aaa7 100644
--- a/tests/real_user/test_stdio_limits.py
+++ b/tests/real_user/test_stdio_limits.py
@@ -69,10 +69,10 @@ async def list_capabilities(self):
             [sys.executable, small_agent], input=large_msg, capture_output=True, text=True, timeout=2
         )
 
-        # Should have errors in stderr about the buffer limit
-        assert "Error" in result.stderr or result.returncode != 0, (
-            f"Expected error with small buffer, got: {result.stderr}"
-        )
+        assert result.returncode == 0
+        assert "LimitOverrunError" not in result.stderr
+        assert "Separator is found, but chunk is longer than limit" not in result.stderr
+        assert "oversized JSON-RPC frame" in result.stderr
 
         # Test 2: Large buffer (200KB) succeeds with large message (70KB)
         large_agent = os.path.join(tmpdir, "large_agent.py")
diff --git a/tests/test_connection_recovery.py b/tests/test_connection_recovery.py
new file mode 100644
index 0000000..dae5a32
--- /dev/null
+++ b/tests/test_connection_recovery.py
@@ -0,0 +1,109 @@
+from __future__ import annotations
+
+import asyncio
+import json
+from typing import Any
+from unittest.mock import AsyncMock, MagicMock
+
+import pytest
+
+from acp.connection import Connection
+from acp.exceptions import RequestError
+
+
+async def _noop_handler(method: str, params: Any, is_notification: bool) -> Any:
+    return None
+
+
+def _make_connection(
+    *,
+    limit: int = 128,
+    receive_timeout: float | None = None,
+) -> tuple[Connection, asyncio.StreamReader]:
+    reader = asyncio.StreamReader(limit=limit)
+    transport = MagicMock()
+    transport.is_closing.return_value = False
+    protocol = AsyncMock()
+    writer = asyncio.StreamWriter(transport, protocol, reader, asyncio.get_running_loop())
+    conn = Connection(_noop_handler, writer, reader, listening=False, receive_timeout=receive_timeout)
+    return conn, reader
+
+
+@pytest.mark.asyncio
+async def test_receive_loop_recovers_from_oversized_frame(caplog: pytest.LogCaptureFixture) -> None:
+    conn, reader = _make_connection(limit=128)
+    processed: list[str] = []
+
+    async def tracking_process(message: dict[str, Any]) -> None:
+        processed.append(message["method"])
+
+    conn._process_message = tracking_process  # type: ignore[method-assign]
+    oversized = {"jsonrpc": "2.0", "method": "too-large", "params": {"data": "X" * 256}}
+    survivor = {"jsonrpc": "2.0", "method": "survivor"}
+    reader.feed_data(json.dumps(oversized).encode() + b"\n" + json.dumps(survivor).encode() + b"\n")
+    reader.feed_eof()
+
+    with caplog.at_level("WARNING"):
+        await conn._receive_loop()
+    await conn.close()
+
+    assert processed == ["survivor"]
+    assert any("oversized JSON-RPC frame" in record.message for record in caplog.records)
+
+
+@pytest.mark.asyncio
+async def test_receive_loop_recovers_from_consecutive_oversized_frames() -> None:
+    conn, reader = _make_connection(limit=128)
+    processed: list[str] = []
+
+    async def tracking_process(message: dict[str, Any]) -> None:
+        processed.append(message["method"])
+
+    conn._process_message = tracking_process  # type: ignore[method-assign]
+    for index in range(2):
+        oversized = {"jsonrpc": "2.0", "method": f"too-large-{index}", "params": {"data": "Y" * 256}}
+        reader.feed_data(json.dumps(oversized).encode() + b"\n")
+    survivor = {"jsonrpc": "2.0", "method": "survivor"}
+    reader.feed_data(json.dumps(survivor).encode() + b"\n")
+    reader.feed_eof()
+
+    await conn._receive_loop()
+    await conn.close()
+
+    assert processed == ["survivor"]
+
+
+@pytest.mark.asyncio
+async def test_receive_loop_handles_eof_during_oversized_frame() -> None:
+    conn, reader = _make_connection(limit=64)
+    reader.feed_data(b"X" * 256)
+    reader.feed_eof()
+
+    await conn._receive_loop()
+    await conn.close()
+
+    assert conn._disconnected is True
+
+
+@pytest.mark.asyncio
+async def test_receive_loop_keeps_timeout_semantics() -> None:
+    conn, _reader = _make_connection(receive_timeout=0.01)
+
+    with pytest.raises(RequestError) as exc_info:
+        await conn._receive_loop()
+    await conn.close()
+
+    exc = exc_info.value
+    assert isinstance(exc, RequestError)
+    assert str(exc) == "Internal error"
+    assert exc.data == {"details": "Agent timeout"}
+
+
+@pytest.mark.asyncio
+async def test_receive_loop_does_not_swallow_unrelated_reader_error() -> None:
+    conn, reader = _make_connection()
+    reader.set_exception(ValueError("reader failed"))
+
+    with pytest.raises(ValueError, match="reader failed"):
+        await conn._receive_loop()
+    await conn.close()