diff --git a/.gitignore b/.gitignore
index 0f5fc4dd5..988cc3f2a 100644
--- a/.gitignore
+++ b/.gitignore
@@ -199,3 +199,4 @@ fastagent.jsonl
 
 # JetBrains IDEs
 .idea/
+tests/e2e/smoke/base/weather_location.txt
diff --git a/src/mcp_agent/config.py b/src/mcp_agent/config.py
index 122e988f3..30881a088 100644
--- a/src/mcp_agent/config.py
+++ b/src/mcp_agent/config.py
@@ -249,6 +249,8 @@ class LoggerSettings(BaseModel):
     """Show MCP Sever tool calls on the console"""
     truncate_tools: bool = True
     """Truncate display of long tool calls"""
+    enable_markup: bool = True
+    """Enable markup in console output. Disable for outputs that may conflict with rich console formatting"""
 
 
 class Settings(BaseSettings):
diff --git a/src/mcp_agent/ui/console_display.py b/src/mcp_agent/ui/console_display.py
index 029f21762..9673843b2 100644
--- a/src/mcp_agent/ui/console_display.py
+++ b/src/mcp_agent/ui/console_display.py
@@ -25,6 +25,7 @@ def __init__(self, config=None) -> None:
             config: Configuration object containing display preferences
         """
         self.config = config
+        self._markup = config.logger.enable_markup if config else True
 
     def show_tool_result(self, result: CallToolResult) -> None:
         """Display a tool result in a formatted panel."""
@@ -46,7 +47,7 @@ def show_tool_result(self, result: CallToolResult) -> None:
             if len(str(result.content)) > 360:
                 panel.height = 8
 
-        console.console.print(panel)
+        console.console.print(panel, markup=self._markup)
         console.console.print("\n")
 
     def show_oai_tool_result(self, result) -> None:
@@ -67,7 +68,7 @@ def show_oai_tool_result(self, result) -> None:
             if len(str(result)) > 360:
                 panel.height = 8
 
-        console.console.print(panel)
+        console.console.print(panel, markup=self._markup)
         console.console.print("\n")
 
     def show_tool_call(self, available_tools, tool_name, tool_args) -> None:
@@ -92,7 +93,7 @@ def show_tool_call(self, available_tools, tool_name, tool_args) -> None:
             if len(str(tool_args)) > 360:
                 panel.height = 8
 
-        console.console.print(panel)
+        console.console.print(panel, markup=self._markup)
         console.console.print("\n")
 
     def _format_tool_list(self, available_tools, selected_tool_name):
@@ -172,7 +173,7 @@ async def show_assistant_message(
             subtitle=display_server_list,
             subtitle_align="left",
         )
-        console.console.print(panel)
+        console.console.print(panel, markup=self._markup)
         console.console.print("\n")
 
     def show_user_message(
@@ -196,7 +197,7 @@ def show_user_message(
             subtitle=subtitle_text,
             subtitle_align="left",
         )
-        console.console.print(panel)
+        console.console.print(panel, markup=self._markup)
         console.console.print("\n")
 
     async def show_prompt_loaded(
@@ -270,5 +271,5 @@ async def show_prompt_loaded(
             subtitle_align="left",
         )
 
-        console.console.print(panel)
+        console.console.print(panel, markup=self._markup)
         console.console.print("\n")
diff --git a/tests/integration/api/fastagent.config.markup.yaml b/tests/integration/api/fastagent.config.markup.yaml
new file mode 100644
index 000000000..74251e742
--- /dev/null
+++ b/tests/integration/api/fastagent.config.markup.yaml
@@ -0,0 +1,54 @@
+# FastAgent Configuration File
+
+# Default Model Configuration:
+#
+# Takes format:
+#   <provider>.<model_string>.<reasoning_effort?> (e.g. anthropic.claude-3-5-sonnet-20241022 or openai.o3-mini.low)
+# Accepts aliases for Anthropic Models: haiku, haiku3, sonnet, sonnet35, opus, opus3
+# and OpenAI Models: gpt-4o-mini, gpt-4o, o1, o1-mini, o3-mini
+#
+# If not specified, defaults to "haiku".
+# Can be overriden with a command line switch --model=<model>, or within the Agent constructor.
+
+default_model: passthrough
+
+# Logging and Console Configuration:
+logger:
+  # level: "debug" | "info" | "warning" | "error"
+  # type: "none" | "console" | "file" | "http"
+  # path: "/path/to/logfile.jsonl"
+
+  # Switch the progress display on or off
+  progress_display: true
+
+  # Show chat User/Assistant messages on the console
+  show_chat: true
+  # Show tool calls on the console
+  show_tools: true
+  # Truncate long tool responses on the console
+  truncate_tools: true
+  enable_markup: false
+
+# MCP Servers
+mcp:
+  servers:
+    prompts:
+      command: "prompt-server"
+      args: ["playback.md"]
+    std_io:
+      command: "uv"
+      args: ["run", "integration_agent.py", "--server", "--transport", "stdio"]
+    sse:
+      transport: "sse"
+      url: "http://localhost:8723/sse"
+    card_test:
+      command: "uv"
+      args: ["run", "mcp_tools_server.py"]
+    hyphen-test:
+      command: "uv"
+      args: ["run", "mcp_tools_server.py"]
+    # borrows config from prompt-server
+    cwd_test:
+      command: "prompt-server"
+      args: ["multi.txt"]
+      cwd: "../prompt-server/"
diff --git a/tests/integration/api/test_markup_config.py b/tests/integration/api/test_markup_config.py
new file mode 100644
index 000000000..f57bdce9f
--- /dev/null
+++ b/tests/integration/api/test_markup_config.py
@@ -0,0 +1,38 @@
+import pytest
+from rich.errors import MarkupError
+
+from mcp_agent.core.prompt import Prompt
+
+
+@pytest.mark.integration
+@pytest.mark.asyncio
+async def test_markup_raises_an_error(fast_agent):
+    """Test that the agent can process a multipart prompts using directory-specific config."""
+    # Use the FastAgent instance from the test directory fixture
+    fast = fast_agent
+
+    # Define the agent
+    @fast.agent(
+        "agent1",
+        instruction="You are a helpful AI Agent",
+    )
+    async def agent_function():
+        async with fast.run() as agent:
+            with pytest.raises(MarkupError):
+                assert "test1" in await agent.agent1.send(Prompt.user("'[/]test1"))
+
+    await agent_function()
+
+
+@pytest.mark.integration
+@pytest.mark.asyncio
+async def test_markup_disabled_does_not_error(markup_fast_agent):
+    @markup_fast_agent.agent(
+        "agent2",
+        instruction="You are a helpful AI Agent",
+    )
+    async def agent_function():
+        async with markup_fast_agent.run() as agent:
+            assert "test2" in await agent.agent2.send(Prompt.user("'[/]test2"))
+
+    await agent_function()
diff --git a/tests/integration/conftest.py b/tests/integration/conftest.py
index d44dd15e9..009a25f8d 100644
--- a/tests/integration/conftest.py
+++ b/tests/integration/conftest.py
@@ -54,7 +54,41 @@ def fast_agent(request):
 
     # Explicitly create absolute path to the config file in the test directory
     config_file = os.path.join(test_dir, "fastagent.config.yaml")
-    
+
+    # Create agent with local config using absolute path
+    agent = FastAgent(
+        "Test Agent",
+        config_path=config_file,  # Use absolute path to local config in test directory
+        ignore_unknown_args=True,
+    )
+
+    # Provide the agent
+    yield agent
+
+    # Restore original directory
+    os.chdir(original_cwd)
+
+
+# Add a fixture that uses the test file's directory
+@pytest.fixture
+def markup_fast_agent(request):
+    """
+    Creates a FastAgent with config from the test file's directory.
+    Automatically changes working directory to match the test file location.
+    """
+    # Get the directory where the test file is located
+    test_module = request.module.__file__
+    test_dir = os.path.dirname(test_module)
+
+    # Save original directory
+    original_cwd = os.getcwd()
+
+    # Change to the test file's directory
+    os.chdir(test_dir)
+
+    # Explicitly create absolute path to the config file in the test directory
+    config_file = os.path.join(test_dir, "fastagent.config.markup.yaml")
+
     # Create agent with local config using absolute path
     agent = FastAgent(
         "Test Agent",
diff --git a/tests/integration/workflow/evaluator_optimizer/fastagent.config.yaml b/tests/integration/workflow/evaluator_optimizer/fastagent.config.yaml
index 150591876..6b878d33f 100644
--- a/tests/integration/workflow/evaluator_optimizer/fastagent.config.yaml
+++ b/tests/integration/workflow/evaluator_optimizer/fastagent.config.yaml
@@ -1,7 +1,2 @@
-logging:
-  dir_path: null
-  file_path: null
-  level: DEBUG
-
 mcp:
-  name: evaluator_optimizer_tests
\ No newline at end of file
+  name: evaluator_optimizer_tests