diff --git a/packages/core/src/services/observationMaskingService.test.ts b/packages/core/src/services/observationMaskingService.test.ts
index 9581f10e01..cfdaa62808 100644
--- a/packages/core/src/services/observationMaskingService.test.ts
+++ b/packages/core/src/services/observationMaskingService.test.ts
@@ -32,6 +32,7 @@ describe('ObservationMaskingService', () => {
       storage: {
         getHistoryDir: () => '/mock/history',
       },
+      getUsageStatisticsEnabled: () => false,
     } as unknown as Config;
     vi.clearAllMocks();
   });
diff --git a/packages/core/src/services/observationMaskingService.ts b/packages/core/src/services/observationMaskingService.ts
index b7fe1bf6ba..f0d984fca7 100644
--- a/packages/core/src/services/observationMaskingService.ts
+++ b/packages/core/src/services/observationMaskingService.ts
@@ -10,6 +10,8 @@ import * as fsPromises from 'node:fs/promises';
 import { estimateTokenCountSync } from '../utils/tokenCalculation.js';
 import { debugLogger } from '../utils/debugLogger.js';
 import type { Config } from '../config/config.js';
+import { logObservationMasking } from '../telemetry/loggers.js';
+import { ObservationMaskingEvent } from '../telemetry/types.js';
 
 export const TOOL_PROTECTION_THRESHOLD = 50_000;
 export const HYSTERESIS_THRESHOLD = 30_000;
@@ -176,11 +178,23 @@ export class ObservationMaskingService {
       `[ObservationMasking] Masked ${prunableParts.length} tool outputs. Saved ~${actualTokensSaved.toLocaleString()} tokens.`,
     );
 
-    return {
+    const result = {
       newHistory,
       maskedCount: prunableParts.length,
       tokensSaved: actualTokensSaved,
     };
+
+    logObservationMasking(
+      config,
+      new ObservationMaskingEvent({
+        tokens_before: totalPrunableTokens,
+        tokens_after: totalPrunableTokens - actualTokensSaved,
+        masked_count: prunableParts.length,
+        total_prunable_tokens: totalPrunableTokens,
+      }),
+    );
+
+    return result;
   }
 
   private getObservationContent(part: Part): string | null {
diff --git a/packages/core/src/telemetry/clearcut-logger/clearcut-logger.ts b/packages/core/src/telemetry/clearcut-logger/clearcut-logger.ts
index 9417bbe983..79154a60e7 100644
--- a/packages/core/src/telemetry/clearcut-logger/clearcut-logger.ts
+++ b/packages/core/src/telemetry/clearcut-logger/clearcut-logger.ts
@@ -44,6 +44,7 @@ import type {
   HookCallEvent,
   ApprovalModeSwitchEvent,
   ApprovalModeDurationEvent,
+  ObservationMaskingEvent,
 } from '../types.js';
 import { EventMetadataKey } from './event-metadata-key.js';
 import type { Config } from '../../config/config.js';
@@ -104,6 +105,7 @@ export enum EventNames {
   HOOK_CALL = 'hook_call',
   APPROVAL_MODE_SWITCH = 'approval_mode_switch',
   APPROVAL_MODE_DURATION = 'approval_mode_duration',
+  OBSERVATION_MASKING = 'observation_masking',
 }
 
 export interface LogResponse {
@@ -1201,8 +1203,40 @@ export class ClearcutLogger {
       },
     ];
 
+    const logEvent = this.createLogEvent(
+      EventNames.TOOL_OUTPUT_TRUNCATED,
+      data,
+    );
+    this.enqueueLogEvent(logEvent);
+    this.flushIfNeeded();
+  }
+
+  logObservationMaskingEvent(event: ObservationMaskingEvent): void {
+    const data: EventValue[] = [
+      {
+        gemini_cli_key:
+          EventMetadataKey.GEMINI_CLI_OBSERVATION_MASKING_TOKENS_BEFORE,
+        value: event.tokens_before.toString(),
+      },
+      {
+        gemini_cli_key:
+          EventMetadataKey.GEMINI_CLI_OBSERVATION_MASKING_TOKENS_AFTER,
+        value: event.tokens_after.toString(),
+      },
+      {
+        gemini_cli_key:
+          EventMetadataKey.GEMINI_CLI_OBSERVATION_MASKING_MASKED_COUNT,
+        value: event.masked_count.toString(),
+      },
+      {
+        gemini_cli_key:
+          EventMetadataKey.GEMINI_CLI_OBSERVATION_MASKING_TOTAL_PRUNABLE_TOKENS,
+        value: event.total_prunable_tokens.toString(),
+      },
+    ];
+
     this.enqueueLogEvent(
-      this.createLogEvent(EventNames.TOOL_OUTPUT_TRUNCATED, data),
+      this.createLogEvent(EventNames.OBSERVATION_MASKING, data),
     );
     this.flushIfNeeded();
   }
diff --git a/packages/core/src/telemetry/clearcut-logger/event-metadata-key.ts b/packages/core/src/telemetry/clearcut-logger/event-metadata-key.ts
index a3b22ce58e..14a67e744d 100644
--- a/packages/core/src/telemetry/clearcut-logger/event-metadata-key.ts
+++ b/packages/core/src/telemetry/clearcut-logger/event-metadata-key.ts
@@ -542,4 +542,20 @@ export enum EventMetadataKey {
 
   // Logs the duration spent in an approval mode in milliseconds.
   GEMINI_CLI_APPROVAL_MODE_DURATION_MS = 143,
+
+  // ==========================================================================
+  // Observation Masking Event Keys
+  // ==========================================================================
+
+  // Logs the total tokens in the prunable block before masking.
+  GEMINI_CLI_OBSERVATION_MASKING_TOKENS_BEFORE = 144,
+
+  // Logs the total tokens in the masked remnants after masking.
+  GEMINI_CLI_OBSERVATION_MASKING_TOKENS_AFTER = 145,
+
+  // Logs the number of tool outputs masked in this operation.
+  GEMINI_CLI_OBSERVATION_MASKING_MASKED_COUNT = 146,
+
+  // Logs the total prunable tokens identified at the trigger point.
+  GEMINI_CLI_OBSERVATION_MASKING_TOTAL_PRUNABLE_TOKENS = 147,
 }
diff --git a/packages/core/src/telemetry/loggers.ts b/packages/core/src/telemetry/loggers.ts
index ae25424464..33841d489e 100644
--- a/packages/core/src/telemetry/loggers.ts
+++ b/packages/core/src/telemetry/loggers.ts
@@ -53,6 +53,7 @@ import type {
   HookCallEvent,
   StartupStatsEvent,
   LlmLoopCheckEvent,
+  ObservationMaskingEvent,
 } from './types.js';
 import {
   recordApiErrorMetrics,
@@ -159,6 +160,21 @@ export function logToolOutputTruncated(
   });
 }
 
+export function logObservationMasking(
+  config: Config,
+  event: ObservationMaskingEvent,
+): void {
+  ClearcutLogger.getInstance(config)?.logObservationMaskingEvent(event);
+  bufferTelemetryEvent(() => {
+    const logger = logs.getLogger(SERVICE_NAME);
+    const logRecord: LogRecord = {
+      body: event.toLogBody(),
+      attributes: event.toOpenTelemetryAttributes(config),
+    };
+    logger.emit(logRecord);
+  });
+}
+
 export function logFileOperation(
   config: Config,
   event: FileOperationEvent,
diff --git a/packages/core/src/telemetry/types.ts b/packages/core/src/telemetry/types.ts
index d10c7e9876..8ea3db0b30 100644
--- a/packages/core/src/telemetry/types.ts
+++ b/packages/core/src/telemetry/types.ts
@@ -1350,6 +1350,49 @@ export class ToolOutputTruncatedEvent implements BaseTelemetryEvent {
   }
 }
 
+export const EVENT_OBSERVATION_MASKING = 'gemini_cli.observation_masking';
+
+export class ObservationMaskingEvent implements BaseTelemetryEvent {
+  'event.name': 'observation_masking';
+  'event.timestamp': string;
+  tokens_before: number;
+  tokens_after: number;
+  masked_count: number;
+  total_prunable_tokens: number;
+
+  constructor(details: {
+    tokens_before: number;
+    tokens_after: number;
+    masked_count: number;
+    total_prunable_tokens: number;
+  }) {
+    this['event.name'] = 'observation_masking';
+    this['event.timestamp'] = new Date().toISOString();
+    this.tokens_before = details.tokens_before;
+    this.tokens_after = details.tokens_after;
+    this.masked_count = details.masked_count;
+    this.total_prunable_tokens = details.total_prunable_tokens;
+  }
+
+  toOpenTelemetryAttributes(config: Config): LogAttributes {
+    return {
+      ...getCommonAttributes(config),
+      'event.name': EVENT_OBSERVATION_MASKING,
+      'event.timestamp': this['event.timestamp'],
+      tokens_before: this.tokens_before,
+      tokens_after: this.tokens_after,
+      masked_count: this.masked_count,
+      total_prunable_tokens: this.total_prunable_tokens,
+    };
+  }
+
+  toLogBody(): string {
+    return `Observation masking (Masked ${this.masked_count} tool outputs. Saved ${
+      this.tokens_before - this.tokens_after
+    } tokens)`;
+  }
+}
+
 export const EVENT_EXTENSION_UNINSTALL = 'gemini_cli.extension_uninstall';
 export class ExtensionUninstallEvent implements BaseTelemetryEvent {
   'event.name': 'extension_uninstall';
@@ -1576,6 +1619,7 @@ export type TelemetryEvent =
   | LlmLoopCheckEvent
   | StartupStatsEvent
   | WebFetchFallbackAttemptEvent
+  | ObservationMaskingEvent
   | EditStrategyEvent
   | EditCorrectionEvent;