diff --git a/server/src/pipeline_state/tests.rs b/server/src/pipeline_state/tests.rs
index c42039e9..e4a11144 100644
--- a/server/src/pipeline_state/tests.rs
+++ b/server/src/pipeline_state/tests.rs
@@ -197,6 +197,42 @@ fn unblock_returns_to_coding() {
     assert!(matches!(result, Stage::Coding));
 }
 
+#[test]
+fn blocked_demote_returns_to_backlog() {
+    // Stuck-story parking lane: `Blocked + Demote → Backlog` lets operators
+    // move a blocked story back to the backlog without losing it to
+    // Archived. Complements `Blocked + Unblock → Coding` which re-enters
+    // active work.
+    let s = Stage::Blocked {
+        reason: "waiting on dep".into(),
+    };
+    let result = transition(s, PipelineEvent::Demote).unwrap();
+    assert!(matches!(result, Stage::Backlog));
+}
+
+#[test]
+fn cannot_demote_from_done() {
+    // Sanity: Demote remains illegal from terminal/archived stages — the
+    // new `Blocked + Demote → Backlog` rule must NOT broaden it further.
+    let s = Stage::Done {
+        merged_at: chrono::Utc::now(),
+        merge_commit: sha("x"),
+    };
+    assert!(matches!(
+        transition(s, PipelineEvent::Demote),
+        Err(TransitionError::InvalidTransition { .. })
+    ));
+}
+
+#[test]
+fn cannot_demote_from_upcoming() {
+    let s = Stage::Upcoming;
+    assert!(matches!(
+        transition(s, PipelineEvent::Demote),
+        Err(TransitionError::InvalidTransition { .. })
+    ));
+}
+
 #[test]
 fn legacy_unblock_archived_blocked_returns_to_backlog() {
     let s = Stage::Archived {
diff --git a/server/src/pipeline_state/transition.rs b/server/src/pipeline_state/transition.rs
index 37510e4b..2061d3fc 100644
--- a/server/src/pipeline_state/transition.rs
+++ b/server/src/pipeline_state/transition.rs
@@ -217,7 +217,13 @@ pub fn transition(state: Stage, event: PipelineEvent) -> Result<Stage, Transitio
         }),
 
         // ── Demote: send an active item back to backlog ────────────────
-        (Coding, Demote) | (Qa, Demote) | (Merge { .. }, Demote) => Ok(Backlog),
+        // `Blocked + Demote → Backlog` lets operators park a stuck story in
+        // the backlog while waiting on dependent fixes, without losing it to
+        // Archived. Unlike `Unblock` (Blocked → Coding), this does not
+        // re-enter the active flow.
+        (Coding, Demote) | (Qa, Demote) | (Merge { .. }, Demote) | (Blocked { .. }, Demote) => {
+            Ok(Backlog)
+        }
 
         // ── Close: direct completion from any active stage ─────────────
         (Backlog, Close) | (Coding, Close) | (Qa, Close) | (Merge { .. }, Close) => Ok(Done {