diff --git a/tests/functional/conftest.py b/tests/functional/conftest.py
index cfe5cef..89ec960 100644
--- a/tests/functional/conftest.py
+++ b/tests/functional/conftest.py
@@ -162,3 +162,18 @@ def pytest_addoption(parser):
 def headed_mode(request):
     """Check if --headed flag was passed."""
     return request.config.getoption("--headed")
+
+
+@pytest.fixture
+def isolated_task_db(tmp_path):
+    """Provide a fresh, isolated SQLite DB for task queue tests.
+
+    Points the task queue module at a temporary database that is unique
+    per test.  pytest's tmp_path is auto-cleaned — no teardown needed.
+    """
+    from swarm.task_queue import models as tq_models
+
+    original = tq_models.DB_PATH
+    tq_models.DB_PATH = tmp_path / "tasks.db"
+    yield tq_models.DB_PATH
+    tq_models.DB_PATH = original
diff --git a/tests/functional/test_inbox_zero.py b/tests/functional/test_inbox_zero.py
new file mode 100644
index 0000000..104f562
--- /dev/null
+++ b/tests/functional/test_inbox_zero.py
@@ -0,0 +1,311 @@
+"""Functional test: Timmy reaches inbox zero by processing all queued tasks.
+
+Verifies that when tasks are created in the queue, the TaskProcessor
+picks them up one by one and drives them all to COMPLETED (or FAILED),
+leaving zero pending/approved/running tasks — inbox zero.
+"""
+
+import asyncio
+
+import pytest
+
+from swarm.task_processor import TaskProcessor
+from swarm.task_queue.models import (
+    TaskStatus,
+    create_task,
+    get_task,
+    get_counts_by_status,
+    list_tasks,
+)
+
+
+# ── Helpers ────────────────────────────────────────────────────────────────
+
+
+def _pending_or_active_count() -> int:
+    """Count tasks that are NOT in a terminal state.
+
+    Terminal states: completed, failed, vetoed, backlogged.
+    """
+    counts = get_counts_by_status()
+    terminal = (
+        counts.get("completed", 0)
+        + counts.get("failed", 0)
+        + counts.get("vetoed", 0)
+        + counts.get("backlogged", 0)
+    )
+    total = sum(counts.values())
+    return total - terminal
+
+
+def _make_processor() -> TaskProcessor:
+    """Create a TaskProcessor with simple echo handlers."""
+    proc = TaskProcessor("timmy")
+    proc.register_handler("chat_response", lambda t: f"Done: {t.title}")
+    proc.register_handler("thought", lambda t: f"Thought: {t.title}")
+    proc.register_handler("internal", lambda t: f"Internal: {t.title}")
+    return proc
+
+
+# ── Tests ──────────────────────────────────────────────────────────────────
+
+
+@pytest.mark.usefixtures("isolated_task_db")
+class TestInboxZero:
+    """Timmy should drain his task queue to zero pending items."""
+
+    async def test_single_task_completes(self):
+        """A single approved task gets picked up and completed."""
+        proc = _make_processor()
+
+        task = create_task(
+            title="Say hello",
+            description="Greet the user",
+            task_type="chat_response",
+            assigned_to="timmy",
+            created_by="user",
+            auto_approve=True,
+        )
+
+        result = await proc.process_next_task()
+        assert result is not None, "Processor should have picked up the task"
+
+        finished = get_task(task.id)
+        assert finished.status == TaskStatus.COMPLETED
+        assert finished.result == "Done: Say hello"
+        assert finished.completed_at is not None
+
+    async def test_multiple_tasks_all_complete(self):
+        """Multiple tasks are processed one-by-one until inbox is empty."""
+        proc = _make_processor()
+
+        titles = ["Fix login bug", "Write docs", "Refactor auth", "Deploy v2", "Update deps"]
+        for title in titles:
+            create_task(
+                title=title,
+                task_type="chat_response",
+                assigned_to="timmy",
+                auto_approve=True,
+            )
+
+        assert _pending_or_active_count() == len(titles)
+
+        processed = 0
+        for _ in range(len(titles) + 5):
+            result = await proc.process_next_task()
+            if result is None:
+                break
+            processed += 1
+
+        assert processed == len(titles), f"Expected {len(titles)} processed, got {processed}"
+        assert _pending_or_active_count() == 0, "Inbox is NOT zero"
+
+    async def test_mixed_task_types_all_complete(self):
+        """Different task types (chat, thought, internal) all get handled."""
+        proc = _make_processor()
+
+        t1 = create_task(title="Chat task", task_type="chat_response", assigned_to="timmy", auto_approve=True)
+        t2 = create_task(title="Thought task", task_type="thought", assigned_to="timmy", auto_approve=True)
+        t3 = create_task(title="Internal task", task_type="internal", assigned_to="timmy", auto_approve=True)
+
+        for _ in range(10):
+            result = await proc.process_next_task()
+            if result is None:
+                break
+
+        assert _pending_or_active_count() == 0, "Not all task types were handled"
+        assert get_task(t1.id).result == "Done: Chat task"
+        assert get_task(t2.id).result == "Thought: Thought task"
+        assert get_task(t3.id).result == "Internal: Internal task"
+
+    async def test_priority_ordering(self):
+        """Urgent tasks are processed before normal ones."""
+        proc = _make_processor()
+
+        create_task(title="Normal task", task_type="chat_response", assigned_to="timmy", priority="normal", auto_approve=True)
+        create_task(title="Urgent task", task_type="chat_response", assigned_to="timmy", priority="urgent", auto_approve=True)
+        create_task(title="Low task", task_type="chat_response", assigned_to="timmy", priority="low", auto_approve=True)
+
+        order = []
+        for _ in range(10):
+            result = await proc.process_next_task()
+            if result is None:
+                break
+            order.append(result.title)
+
+        assert order == ["Urgent task", "Normal task", "Low task"]
+        assert _pending_or_active_count() == 0
+
+    async def test_failing_task_does_not_block_queue(self):
+        """A task whose handler raises still gets marked FAILED and the queue moves on."""
+        proc = TaskProcessor("timmy")
+
+        def exploding_handler(task):
+            raise RuntimeError("Kaboom!")
+
+        proc.register_handler("chat_response", exploding_handler)
+        proc.register_handler("thought", lambda t: "OK")
+
+        t_fail = create_task(title="Will fail", task_type="chat_response", assigned_to="timmy", auto_approve=True)
+        t_ok = create_task(title="Will succeed", task_type="thought", assigned_to="timmy", auto_approve=True)
+
+        # Process first task — handler raises, processor catches it and marks FAILED
+        result = await proc.process_next_task()
+        assert result is None, "Failed task should return None"
+        assert get_task(t_fail.id).status == TaskStatus.FAILED
+        assert "Kaboom" in get_task(t_fail.id).result
+
+        # Process second task — should succeed despite the prior failure
+        result = await proc.process_next_task()
+        assert result is not None
+        assert result.title == "Will succeed"
+        assert get_task(t_ok.id).status == TaskStatus.COMPLETED
+        assert _pending_or_active_count() == 0
+
+    async def test_unregistered_type_gets_backlogged(self):
+        """A task with no registered handler gets backlogged so it doesn't block the queue."""
+        proc = TaskProcessor("timmy")
+        # No handlers registered at all
+
+        task = create_task(title="Mystery task", task_type="unknown_type", assigned_to="timmy", auto_approve=True)
+
+        result = await proc.process_next_task()
+        assert result is None, "Task with no handler should return None (backlogged)"
+
+        finished = get_task(task.id)
+        assert finished.status == TaskStatus.BACKLOGGED
+        assert "No handler" in finished.result
+        assert _pending_or_active_count() == 0, "Backlogged task should not block the queue"
+
+    async def test_pending_approval_requires_approval_is_skipped(self):
+        """Tasks needing human approval are skipped — they stay in the queue."""
+        proc = _make_processor()
+
+        task = create_task(
+            title="Needs approval",
+            task_type="chat_response",
+            assigned_to="timmy",
+            auto_approve=False,
+            requires_approval=True,
+        )
+        assert task.status == TaskStatus.PENDING_APPROVAL
+
+        result = await proc.process_next_task()
+        assert result is None, "Task requiring approval should be skipped"
+
+        finished = get_task(task.id)
+        assert finished.status == TaskStatus.PENDING_APPROVAL, "Should remain pending"
+
+    async def test_auto_approved_tasks_are_picked_up(self):
+        """Tasks that don't require approval get processed immediately."""
+        proc = _make_processor()
+
+        task = create_task(
+            title="No gate needed",
+            task_type="chat_response",
+            assigned_to="timmy",
+            auto_approve=False,
+            requires_approval=False,
+        )
+        assert task.status == TaskStatus.PENDING_APPROVAL
+
+        result = await proc.process_next_task()
+        assert result is not None
+
+        finished = get_task(task.id)
+        assert finished.status == TaskStatus.COMPLETED
+
+    async def test_run_loop_reaches_inbox_zero(self):
+        """The processing loop drains all tasks within a bounded time."""
+        proc = _make_processor()
+
+        for i in range(7):
+            create_task(
+                title=f"Loop task {i}",
+                task_type="chat_response",
+                assigned_to="timmy",
+                auto_approve=True,
+            )
+
+        assert _pending_or_active_count() == 7
+
+        async def run_briefly():
+            for _ in range(20):
+                try:
+                    await proc.process_next_task()
+                except Exception:
+                    pass
+                if _pending_or_active_count() == 0:
+                    return
+                await asyncio.sleep(0.01)
+
+        await asyncio.wait_for(run_briefly(), timeout=5.0)
+        assert _pending_or_active_count() == 0, "Loop did not reach inbox zero"
+
+    async def test_timestamps_set_on_completion(self):
+        """started_at and completed_at are properly set during processing."""
+        proc = _make_processor()
+
+        task = create_task(
+            title="Timestamp check",
+            task_type="chat_response",
+            assigned_to="timmy",
+            auto_approve=True,
+        )
+        assert task.started_at is None
+        assert task.completed_at is None
+
+        await proc.process_next_task()
+
+        finished = get_task(task.id)
+        assert finished.started_at is not None, "started_at should be set when task runs"
+        assert finished.completed_at is not None, "completed_at should be set when task finishes"
+        assert finished.started_at <= finished.completed_at
+
+    async def test_steps_updated_on_completion(self):
+        """Task steps are updated as the processor works through a task."""
+        proc = _make_processor()
+
+        task = create_task(
+            title="Steps check",
+            task_type="chat_response",
+            assigned_to="timmy",
+            auto_approve=True,
+        )
+
+        await proc.process_next_task()
+
+        finished = get_task(task.id)
+        assert finished.status == TaskStatus.COMPLETED
+        assert len(finished.steps) > 0
+        assert finished.steps[0]["status"] == "completed"
+
+    async def test_inbox_zero_after_burst(self):
+        """Simulate a burst of 20 tasks and verify inbox zero is achieved."""
+        proc = _make_processor()
+
+        task_ids = []
+        for i in range(20):
+            t = create_task(
+                title=f"Burst task {i}",
+                task_type="chat_response",
+                assigned_to="timmy",
+                auto_approve=True,
+            )
+            task_ids.append(t.id)
+
+        assert _pending_or_active_count() == 20
+
+        processed = 0
+        for _ in range(30):
+            result = await proc.process_next_task()
+            if result is None:
+                break
+            processed += 1
+
+        assert processed == 20
+        assert _pending_or_active_count() == 0, f"Inbox NOT zero — {_pending_or_active_count()} remaining"
+
+        # All 20 should be completed
+        completed = [get_task(tid) for tid in task_ids]
+        assert all(t.status == TaskStatus.COMPLETED for t in completed)