diff --git a/apps/orchestrator/src/config/orchestrator.config.spec.ts b/apps/orchestrator/src/config/orchestrator.config.spec.ts
new file mode 100644
index 0000000..0c44f9d
--- /dev/null
+++ b/apps/orchestrator/src/config/orchestrator.config.spec.ts
@@ -0,0 +1,86 @@
+import { describe, it, expect, beforeEach, afterEach } from "vitest";
+import { orchestratorConfig } from "./orchestrator.config";
+
+describe("orchestratorConfig", () => {
+  const originalEnv = process.env;
+
+  beforeEach(() => {
+    process.env = { ...originalEnv };
+  });
+
+  afterEach(() => {
+    process.env = originalEnv;
+  });
+
+  describe("sandbox.enabled", () => {
+    it("should be enabled by default when SANDBOX_ENABLED is not set", () => {
+      delete process.env.SANDBOX_ENABLED;
+
+      const config = orchestratorConfig();
+
+      expect(config.sandbox.enabled).toBe(true);
+    });
+
+    it("should be enabled when SANDBOX_ENABLED is set to 'true'", () => {
+      process.env.SANDBOX_ENABLED = "true";
+
+      const config = orchestratorConfig();
+
+      expect(config.sandbox.enabled).toBe(true);
+    });
+
+    it("should be disabled only when SANDBOX_ENABLED is explicitly set to 'false'", () => {
+      process.env.SANDBOX_ENABLED = "false";
+
+      const config = orchestratorConfig();
+
+      expect(config.sandbox.enabled).toBe(false);
+    });
+
+    it("should be enabled for any other value of SANDBOX_ENABLED", () => {
+      process.env.SANDBOX_ENABLED = "yes";
+
+      const config = orchestratorConfig();
+
+      expect(config.sandbox.enabled).toBe(true);
+    });
+
+    it("should be enabled when SANDBOX_ENABLED is empty string", () => {
+      process.env.SANDBOX_ENABLED = "";
+
+      const config = orchestratorConfig();
+
+      expect(config.sandbox.enabled).toBe(true);
+    });
+  });
+
+  describe("other config values", () => {
+    it("should use default port when ORCHESTRATOR_PORT is not set", () => {
+      delete process.env.ORCHESTRATOR_PORT;
+
+      const config = orchestratorConfig();
+
+      expect(config.port).toBe(3001);
+    });
+
+    it("should use provided port when ORCHESTRATOR_PORT is set", () => {
+      process.env.ORCHESTRATOR_PORT = "4000";
+
+      const config = orchestratorConfig();
+
+      expect(config.port).toBe(4000);
+    });
+
+    it("should use default valkey config when not set", () => {
+      delete process.env.VALKEY_HOST;
+      delete process.env.VALKEY_PORT;
+      delete process.env.VALKEY_URL;
+
+      const config = orchestratorConfig();
+
+      expect(config.valkey.host).toBe("localhost");
+      expect(config.valkey.port).toBe(6379);
+      expect(config.valkey.url).toBe("redis://localhost:6379");
+    });
+  });
+});
diff --git a/apps/orchestrator/src/config/orchestrator.config.ts b/apps/orchestrator/src/config/orchestrator.config.ts
index ca455df..29b6622 100644
--- a/apps/orchestrator/src/config/orchestrator.config.ts
+++ b/apps/orchestrator/src/config/orchestrator.config.ts
@@ -22,7 +22,7 @@ export const orchestratorConfig = registerAs("orchestrator", () => ({
     enabled: process.env.KILLSWITCH_ENABLED === "true",
   },
   sandbox: {
-    enabled: process.env.SANDBOX_ENABLED === "true",
+    enabled: process.env.SANDBOX_ENABLED !== "false",
     defaultImage: process.env.SANDBOX_DEFAULT_IMAGE ?? "node:20-alpine",
     defaultMemoryMB: parseInt(process.env.SANDBOX_DEFAULT_MEMORY_MB ?? "512", 10),
     defaultCpuLimit: parseFloat(process.env.SANDBOX_DEFAULT_CPU_LIMIT ?? "1.0"),
diff --git a/apps/orchestrator/src/spawner/docker-sandbox.service.spec.ts b/apps/orchestrator/src/spawner/docker-sandbox.service.spec.ts
index baa6985..7f50fac 100644
--- a/apps/orchestrator/src/spawner/docker-sandbox.service.spec.ts
+++ b/apps/orchestrator/src/spawner/docker-sandbox.service.spec.ts
@@ -1,5 +1,6 @@
 import { ConfigService } from "@nestjs/config";
-import { describe, it, expect, beforeEach, vi } from "vitest";
+import { Logger } from "@nestjs/common";
+import { describe, it, expect, beforeEach, vi, afterEach } from "vitest";
 import { DockerSandboxService } from "./docker-sandbox.service";
 import Docker from "dockerode";
 
@@ -331,4 +332,45 @@ describe("DockerSandboxService", () => {
       expect(disabledService.isEnabled()).toBe(false);
     });
   });
+
+  describe("security warning", () => {
+    let warnSpy: ReturnType<typeof vi.spyOn>;
+
+    beforeEach(() => {
+      warnSpy = vi.spyOn(Logger.prototype, "warn").mockImplementation(() => undefined);
+    });
+
+    afterEach(() => {
+      warnSpy.mockRestore();
+    });
+
+    it("should log security warning when sandbox is disabled", () => {
+      const disabledConfigService = {
+        get: vi.fn((key: string, defaultValue?: unknown) => {
+          const config: Record<string, unknown> = {
+            "orchestrator.docker.socketPath": "/var/run/docker.sock",
+            "orchestrator.sandbox.enabled": false,
+            "orchestrator.sandbox.defaultImage": "node:20-alpine",
+            "orchestrator.sandbox.defaultMemoryMB": 512,
+            "orchestrator.sandbox.defaultCpuLimit": 1.0,
+            "orchestrator.sandbox.networkMode": "bridge",
+          };
+          return config[key] !== undefined ? config[key] : defaultValue;
+        }),
+      } as unknown as ConfigService;
+
+      new DockerSandboxService(disabledConfigService, mockDocker);
+
+      expect(warnSpy).toHaveBeenCalledWith(
+        "SECURITY WARNING: Docker sandbox is DISABLED. Agents will run directly on the host without container isolation."
+      );
+    });
+
+    it("should not log security warning when sandbox is enabled", () => {
+      // Use the default mockConfigService which has sandbox enabled
+      new DockerSandboxService(mockConfigService, mockDocker);
+
+      expect(warnSpy).not.toHaveBeenCalledWith(expect.stringContaining("SECURITY WARNING"));
+    });
+  });
 });
diff --git a/apps/orchestrator/src/spawner/docker-sandbox.service.ts b/apps/orchestrator/src/spawner/docker-sandbox.service.ts
index ffdd535..331a92e 100644
--- a/apps/orchestrator/src/spawner/docker-sandbox.service.ts
+++ b/apps/orchestrator/src/spawner/docker-sandbox.service.ts
@@ -53,6 +53,12 @@ export class DockerSandboxService {
     this.logger.log(
       `DockerSandboxService initialized (enabled: ${this.sandboxEnabled.toString()}, socket: ${socketPath})`
     );
+
+    if (!this.sandboxEnabled) {
+      this.logger.warn(
+        "SECURITY WARNING: Docker sandbox is DISABLED. Agents will run directly on the host without container isolation."
+      );
+    }
   }
 
   /**