diff --git a/internal-packages/run-engine/src/engine/tests/createCancelledRun.test.ts b/internal-packages/run-engine/src/engine/tests/createCancelledRun.test.ts
new file mode 100644
index 000000000..bead0cdbd
--- /dev/null
+++ b/internal-packages/run-engine/src/engine/tests/createCancelledRun.test.ts
@@ -0,0 +1,186 @@
+import { containerTest } from "@internal/testcontainers";
+import { trace } from "@internal/tracing";
+import { RunId } from "@trigger.dev/core/v3/isomorphic";
+
+function freshRunId() {
+  return RunId.generate().friendlyId;
+}
+import { expect } from "vitest";
+import { RunEngine } from "../index.js";
+import type { EventBusEventArgs } from "../eventBus.js";
+import { setupAuthenticatedEnvironment } from "./setup.js";
+
+vi.setConfig({ testTimeout: 60_000 });
+
+function baseEngineOptions(redisOptions: Parameters<typeof RunEngine>[0]["queue"]["redis"]) {
+  return {
+    worker: {
+      redis: redisOptions,
+      workers: 1,
+      tasksPerWorker: 10,
+      pollIntervalMs: 100,
+    },
+    queue: {
+      redis: redisOptions,
+      masterQueueConsumersDisabled: true,
+      processWorkerQueueDebounceMs: 50,
+    },
+    runLock: {
+      redis: redisOptions,
+    },
+    machines: {
+      defaultMachine: "small-1x" as const,
+      machines: {
+        "small-1x": {
+          name: "small-1x" as const,
+          cpu: 0.5,
+          memory: 0.5,
+          centsPerMs: 0.0001,
+        },
+      },
+      baseCostInCents: 0.0001,
+    },
+    tracer: trace.getTracer("test", "0.0.0"),
+  };
+}
+
+// Phase C1 / Q4 design — engine.createCancelledRun writes a CANCELED
+// TaskRun row directly from a buffer snapshot. Verifies the bypass-
+// queue / bypass-waitpoint / emit-runCancelled contract.
+describe("RunEngine.createCancelledRun", () => {
+  containerTest(
+    "writes CANCELED PG row with snapshot fields, completedAt, error",
+    async ({ prisma, redisOptions }) => {
+      const env = await setupAuthenticatedEnvironment(prisma, "PRODUCTION");
+      const engine = new RunEngine({ prisma, ...baseEngineOptions(redisOptions) });
+      try {
+        const friendlyId = freshRunId();
+        const cancelledAt = new Date("2026-05-20T12:00:00.000Z");
+        const cancelReason = "Canceled by user";
+
+        const result = await engine.createCancelledRun({
+          snapshot: {
+            friendlyId,
+            environment: env,
+            taskIdentifier: "test-task",
+            payload: '{"hello":"world"}',
+            payloadType: "application/json",
+            context: {},
+            traceContext: {},
+            traceId: "0000000000000000aaaa000000000000",
+            spanId: "bbbb000000000000",
+            queue: "task/test-task",
+            isTest: false,
+            tags: ["test-tag"],
+          },
+          cancelledAt,
+          cancelReason,
+        });
+
+        expect(result.status).toBe("CANCELED");
+        expect(result.friendlyId).toBe(friendlyId);
+        expect(result.id).toBe(RunId.fromFriendlyId(friendlyId));
+        expect(result.completedAt?.toISOString()).toBe(cancelledAt.toISOString());
+        expect(result.taskIdentifier).toBe("test-task");
+        expect(result.runTags).toEqual(["test-tag"]);
+        expect(result.payload).toBe('{"hello":"world"}');
+        const err = result.error as { type?: string; raw?: string };
+        expect(err.type).toBe("STRING_ERROR");
+        expect(err.raw).toBe(cancelReason);
+
+        // Verify the PG row is canonical (findFirst returns the row).
+        const stored = await prisma.taskRun.findFirst({
+          where: { friendlyId },
+        });
+        expect(stored).not.toBeNull();
+        expect(stored!.status).toBe("CANCELED");
+      } finally {
+        await engine.quit();
+      }
+    },
+  );
+
+  containerTest(
+    "emits runCancelled with correct payload",
+    async ({ prisma, redisOptions }) => {
+      const env = await setupAuthenticatedEnvironment(prisma, "PRODUCTION");
+      const engine = new RunEngine({ prisma, ...baseEngineOptions(redisOptions) });
+      const captured: EventBusEventArgs<"runCancelled">[0][] = [];
+      engine.eventBus.on("runCancelled", (event) => {
+        captured.push(event);
+      });
+
+      try {
+        const cancelledAt = new Date();
+        const cancelReason = "Test cancel";
+        const friendlyId = freshRunId();
+        await engine.createCancelledRun({
+          snapshot: {
+            friendlyId,
+            environment: env,
+            taskIdentifier: "test-task",
+            payload: "{}",
+            payloadType: "application/json",
+            context: {},
+            traceContext: {},
+            traceId: "0000000000000000cccc000000000000",
+            spanId: "dddd000000000000",
+            queue: "task/test-task",
+            isTest: false,
+            tags: [],
+          },
+          cancelledAt,
+          cancelReason,
+        });
+
+        expect(captured).toHaveLength(1);
+        expect(captured[0]!.run.status).toBe("CANCELED");
+        expect(captured[0]!.run.friendlyId).toBe(friendlyId);
+        expect(captured[0]!.run.error).toEqual({ type: "STRING_ERROR", raw: cancelReason });
+        expect(captured[0]!.organization.id).toBe(env.organization.id);
+      } finally {
+        await engine.quit();
+      }
+    },
+  );
+
+  containerTest(
+    "idempotent on double-pop: second call returns existing row without re-emitting",
+    async ({ prisma, redisOptions }) => {
+      const env = await setupAuthenticatedEnvironment(prisma, "PRODUCTION");
+      const engine = new RunEngine({ prisma, ...baseEngineOptions(redisOptions) });
+      const captured: EventBusEventArgs<"runCancelled">[0][] = [];
+      engine.eventBus.on("runCancelled", (event) => {
+        captured.push(event);
+      });
+
+      try {
+        const snapshot = {
+          friendlyId: freshRunId(),
+          environment: env,
+          taskIdentifier: "test-task",
+          payload: "{}",
+          payloadType: "application/json",
+          context: {},
+          traceContext: {},
+          traceId: "0000000000000000eeee000000000000",
+          spanId: "ffff000000000000",
+          queue: "task/test-task",
+          isTest: false,
+          tags: [],
+        };
+        const cancelledAt = new Date();
+        const cancelReason = "Test idempotent";
+
+        const first = await engine.createCancelledRun({ snapshot, cancelledAt, cancelReason });
+        const second = await engine.createCancelledRun({ snapshot, cancelledAt, cancelReason });
+
+        expect(second.id).toBe(first.id);
+        // Only the first call's emit fired; the P2002 path skips re-emission.
+        expect(captured).toHaveLength(1);
+      } finally {
+        await engine.quit();
+      }
+    },
+  );
+});