diff --git a/internal/api/router.go b/internal/api/router.go
index cd7f8af21..6e20488e0 100644
--- a/internal/api/router.go
+++ b/internal/api/router.go
@@ -4866,9 +4866,11 @@ func (r *Router) handleAgentVersion(w http.ResponseWriter, req *http.Request) {
 		return
 	}
 
-	// Return the server version - all agents should match the server version
+	// Return the server version - all agents should match the server version.
+	// Dev/git builds return "dev" so agents don't enter an infinite update loop
+	// (the agent skips updates when the server reports "dev").
 	version := "dev"
-	if versionInfo, err := updates.GetCurrentVersion(); err == nil {
+	if versionInfo, err := updates.GetCurrentVersion(); err == nil && !versionInfo.IsDevelopment {
 		version = versionInfo.Version
 	}