diff --git a/.gitignore b/.gitignore
index 848d233..7dcccaf 100644
--- a/.gitignore
+++ b/.gitignore
@@ -1,4 +1,5 @@
 dist
 node_modules
 package-lock.json
-.DS_Store
\ No newline at end of file
+.DS_Store
+PR-SUBMISSION-GUIDE.md
diff --git a/src/startHTTPServer.test.ts b/src/startHTTPServer.test.ts
index bc0ff15..096096e 100644
--- a/src/startHTTPServer.test.ts
+++ b/src/startHTTPServer.test.ts
@@ -701,3 +701,483 @@ it("does not require auth for OPTIONS requests", async () => {
 
   await httpServer.close();
 });
+
+// Stateless OAuth 2.0 JWT Bearer Token Authentication Tests (PR #37)
+
+it("accepts requests with valid Bearer token in stateless mode", async () => {
+  const stdioTransport = new StdioClientTransport({
+    args: ["src/fixtures/simple-stdio-server.ts"],
+    command: "tsx",
+  });
+
+  const stdioClient = new Client(
+    {
+      name: "mcp-proxy",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await stdioClient.connect(stdioTransport);
+
+  const serverVersion = stdioClient.getServerVersion() as {
+    name: string;
+    version: string;
+  };
+
+  const serverCapabilities = stdioClient.getServerCapabilities() as {
+    capabilities: Record<string, unknown>;
+  };
+
+  const port = await getRandomPort();
+
+  // Mock authenticate callback that validates JWT Bearer token
+  const mockAuthResult = { email: "test@example.com", userId: "user123" };
+  const authenticate = vi.fn().mockResolvedValue(mockAuthResult);
+
+  const httpServer = await startHTTPServer({
+    authenticate,
+    createServer: async () => {
+      const mcpServer = new Server(serverVersion, {
+        capabilities: serverCapabilities,
+      });
+
+      await proxyServer({
+        client: stdioClient,
+        server: mcpServer,
+        serverCapabilities,
+      });
+
+      return mcpServer;
+    },
+    port,
+    stateless: true, // Enable stateless mode
+  });
+
+  // Create a stateless streamable HTTP client with Bearer token
+  const streamTransport = new StreamableHTTPClientTransport(
+    new URL(`http://localhost:${port}/mcp`),
+    {
+      requestInit: {
+        headers: {
+          Authorization: "Bearer valid-jwt-token",
+        },
+      },
+    },
+  );
+
+  const streamClient = new Client(
+    {
+      name: "stream-client-oauth",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await streamClient.connect(streamTransport);
+
+  // Test that we can make requests with valid authentication
+  const result = await streamClient.listResources();
+  expect(result).toEqual({
+    resources: [
+      {
+        name: "Example Resource",
+        uri: "file:///example.txt",
+      },
+    ],
+  });
+
+  // Verify authenticate callback was called
+  expect(authenticate).toHaveBeenCalled();
+
+  await streamClient.close();
+  await httpServer.close();
+  await stdioClient.close();
+});
+
+it("returns 401 when authenticate callback returns null in stateless mode", async () => {
+  const stdioTransport = new StdioClientTransport({
+    args: ["src/fixtures/simple-stdio-server.ts"],
+    command: "tsx",
+  });
+
+  const stdioClient = new Client(
+    {
+      name: "mcp-proxy",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await stdioClient.connect(stdioTransport);
+
+  const serverVersion = stdioClient.getServerVersion() as {
+    name: string;
+    version: string;
+  };
+
+  const serverCapabilities = stdioClient.getServerCapabilities() as {
+    capabilities: Record<string, unknown>;
+  };
+
+  const port = await getRandomPort();
+
+  // Mock authenticate callback that rejects invalid token
+  const authenticate = vi.fn().mockResolvedValue(null);
+
+  const httpServer = await startHTTPServer({
+    authenticate,
+    createServer: async () => {
+      const mcpServer = new Server(serverVersion, {
+        capabilities: serverCapabilities,
+      });
+
+      await proxyServer({
+        client: stdioClient,
+        server: mcpServer,
+        serverCapabilities,
+      });
+
+      return mcpServer;
+    },
+    port,
+    stateless: true,
+  });
+
+  // Create client with invalid Bearer token
+  const streamTransport = new StreamableHTTPClientTransport(
+    new URL(`http://localhost:${port}/mcp`),
+    {
+      requestInit: {
+        headers: {
+          Authorization: "Bearer invalid-jwt-token",
+        },
+      },
+    },
+  );
+
+  const streamClient = new Client(
+    {
+      name: "stream-client-invalid-token",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  // Connection should fail due to invalid authentication
+  await expect(streamClient.connect(streamTransport)).rejects.toThrow();
+
+  // Verify authenticate callback was called
+  expect(authenticate).toHaveBeenCalled();
+
+  await httpServer.close();
+  await stdioClient.close();
+});
+
+it("returns 401 when authenticate callback throws error in stateless mode", async () => {
+  const stdioTransport = new StdioClientTransport({
+    args: ["src/fixtures/simple-stdio-server.ts"],
+    command: "tsx",
+  });
+
+  const stdioClient = new Client(
+    {
+      name: "mcp-proxy",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await stdioClient.connect(stdioTransport);
+
+  const serverVersion = stdioClient.getServerVersion() as {
+    name: string;
+    version: string;
+  };
+
+  const serverCapabilities = stdioClient.getServerCapabilities() as {
+    capabilities: Record<string, unknown>;
+  };
+
+  const port = await getRandomPort();
+
+  // Mock authenticate callback that throws (e.g., JWKS endpoint failure)
+  const authenticate = vi
+    .fn()
+    .mockRejectedValue(new Error("JWKS fetch failed"));
+
+  const httpServer = await startHTTPServer({
+    authenticate,
+    createServer: async () => {
+      const mcpServer = new Server(serverVersion, {
+        capabilities: serverCapabilities,
+      });
+
+      await proxyServer({
+        client: stdioClient,
+        server: mcpServer,
+        serverCapabilities,
+      });
+
+      return mcpServer;
+    },
+    port,
+    stateless: true,
+  });
+
+  // Create client with Bearer token
+  const streamTransport = new StreamableHTTPClientTransport(
+    new URL(`http://localhost:${port}/mcp`),
+    {
+      requestInit: {
+        headers: {
+          Authorization: "Bearer some-token",
+        },
+      },
+    },
+  );
+
+  const streamClient = new Client(
+    {
+      name: "stream-client-auth-error",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  // Connection should fail due to authentication error
+  await expect(streamClient.connect(streamTransport)).rejects.toThrow();
+
+  // Verify authenticate callback was called
+  expect(authenticate).toHaveBeenCalled();
+
+  await httpServer.close();
+  await stdioClient.close();
+});
+
+it("does not call authenticate on subsequent requests in stateful mode", async () => {
+  const stdioTransport = new StdioClientTransport({
+    args: ["src/fixtures/simple-stdio-server.ts"],
+    command: "tsx",
+  });
+
+  const stdioClient = new Client(
+    {
+      name: "mcp-proxy",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await stdioClient.connect(stdioTransport);
+
+  const serverVersion = stdioClient.getServerVersion() as {
+    name: string;
+    version: string;
+  };
+
+  const serverCapabilities = stdioClient.getServerCapabilities() as {
+    capabilities: Record<string, unknown>;
+  };
+
+  const port = await getRandomPort();
+
+  // Mock authenticate callback
+  const authenticate = vi.fn().mockResolvedValue({ userId: "user123" });
+
+  const onConnect = vi.fn().mockResolvedValue(undefined);
+  const onClose = vi.fn().mockResolvedValue(undefined);
+
+  const httpServer = await startHTTPServer({
+    authenticate,
+    createServer: async () => {
+      const mcpServer = new Server(serverVersion, {
+        capabilities: serverCapabilities,
+      });
+
+      await proxyServer({
+        client: stdioClient,
+        server: mcpServer,
+        serverCapabilities,
+      });
+
+      return mcpServer;
+    },
+    onClose,
+    onConnect,
+    port,
+    stateless: false, // Explicitly use stateful mode
+  });
+
+  // Create client
+  const streamTransport = new StreamableHTTPClientTransport(
+    new URL(`http://localhost:${port}/mcp`),
+  );
+
+  const streamClient = new Client(
+    {
+      name: "stream-client-stateful",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await streamClient.connect(streamTransport);
+
+  // Make first request
+  await streamClient.listResources();
+
+  // Make second request
+  await streamClient.listResources();
+
+  // In stateful mode, authenticate should NOT be called per-request
+  // It may be called during initialization, but not on every tool call
+  // The key is that it's not called multiple times for each request
+  expect(authenticate).not.toHaveBeenCalled();
+
+  await streamClient.close();
+  await httpServer.close();
+  await stdioClient.close();
+});
+
+it("calls authenticate on every request in stateless mode", async () => {
+  const stdioTransport = new StdioClientTransport({
+    args: ["src/fixtures/simple-stdio-server.ts"],
+    command: "tsx",
+  });
+
+  const stdioClient = new Client(
+    {
+      name: "mcp-proxy",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await stdioClient.connect(stdioTransport);
+
+  const serverVersion = stdioClient.getServerVersion() as {
+    name: string;
+    version: string;
+  };
+
+  const serverCapabilities = stdioClient.getServerCapabilities() as {
+    capabilities: Record<string, unknown>;
+  };
+
+  const port = await getRandomPort();
+
+  // Mock authenticate callback
+  const authenticate = vi.fn().mockResolvedValue({ userId: "user123" });
+
+  const httpServer = await startHTTPServer({
+    authenticate,
+    createServer: async () => {
+      const mcpServer = new Server(serverVersion, {
+        capabilities: serverCapabilities,
+      });
+
+      await proxyServer({
+        client: stdioClient,
+        server: mcpServer,
+        serverCapabilities,
+      });
+
+      return mcpServer;
+    },
+    port,
+    stateless: true, // Enable stateless mode
+  });
+
+  // Create client with Bearer token
+  const streamTransport = new StreamableHTTPClientTransport(
+    new URL(`http://localhost:${port}/mcp`),
+    {
+      requestInit: {
+        headers: {
+          Authorization: "Bearer test-token",
+        },
+      },
+    },
+  );
+
+  const streamClient = new Client(
+    {
+      name: "stream-client-per-request",
+      version: "1.0.0",
+    },
+    {
+      capabilities: {},
+    },
+  );
+
+  await streamClient.connect(streamTransport);
+
+  const initialCallCount = authenticate.mock.calls.length;
+
+  // Make first request
+  await streamClient.listResources();
+  const firstRequestCallCount = authenticate.mock.calls.length;
+
+  // Make second request
+  await streamClient.listResources();
+  const secondRequestCallCount = authenticate.mock.calls.length;
+
+  // In stateless mode, authenticate should be called on EVERY request
+  expect(firstRequestCallCount).toBeGreaterThan(initialCallCount);
+  expect(secondRequestCallCount).toBeGreaterThan(firstRequestCallCount);
+
+  await streamClient.close();
+  await httpServer.close();
+  await stdioClient.close();
+});
+
+it("includes Authorization in CORS allowed headers", async () => {
+  const port = await getRandomPort();
+
+  const httpServer = await startHTTPServer({
+    createServer: async () => {
+      const mcpServer = new Server(
+        { name: "test", version: "1.0.0" },
+        { capabilities: {} },
+      );
+      return mcpServer;
+    },
+    port,
+  });
+
+  // Test OPTIONS request to verify CORS headers
+  const response = await fetch(`http://localhost:${port}/mcp`, {
+    headers: {
+      Origin: "https://example.com",
+    },
+    method: "OPTIONS",
+  });
+
+  expect(response.status).toBe(204);
+
+  // Verify Authorization is in the allowed headers
+  const allowedHeaders = response.headers.get("Access-Control-Allow-Headers");
+  expect(allowedHeaders).toBeTruthy();
+  expect(allowedHeaders).toContain("Authorization");
+
+  await httpServer.close();
+});
diff --git a/src/startHTTPServer.ts b/src/startHTTPServer.ts
index f94705f..5ebdd82 100644
--- a/src/startHTTPServer.ts
+++ b/src/startHTTPServer.ts
@@ -93,6 +93,7 @@ const cleanupServer = async <T extends ServerLike>(
 
 const handleStreamRequest = async <T extends ServerLike>({
   activeTransports,
+  authenticate,
   createServer,
   enableJsonResponse,
   endpoint,
@@ -107,6 +108,7 @@ const handleStreamRequest = async <T extends ServerLike>({
     string,
     { server: T; transport: StreamableHTTPServerTransport }
   >;
+  authenticate?: (request: http.IncomingMessage) => Promise<unknown>;
   createServer: (request: http.IncomingMessage) => Promise<T>;
   enableJsonResponse?: boolean;
   endpoint: string;
@@ -132,6 +134,41 @@ const handleStreamRequest = async <T extends ServerLike>({
 
       const body = await getBody(req);
 
+      // Per-request authentication in stateless mode
+      if (stateless && authenticate) {
+        try {
+          const authResult = await authenticate(req);
+          if (!authResult) {
+            res.setHeader("Content-Type", "application/json");
+            res.writeHead(401).end(
+              JSON.stringify({
+                error: {
+                  code: -32000,
+                  message: "Unauthorized: Authentication failed"
+                },
+                id: (body as { id?: unknown })?.id ?? null,
+                jsonrpc: "2.0"
+              })
+            );
+            return true;
+          }
+        } catch (error) {
+          console.error("Authentication error:", error);
+          res.setHeader("Content-Type", "application/json");
+          res.writeHead(401).end(
+            JSON.stringify({
+              error: {
+                code: -32000,
+                message: "Unauthorized: Authentication error"
+              },
+              id: (body as { id?: unknown })?.id ?? null,
+              jsonrpc: "2.0"
+            })
+          );
+          return true;
+        }
+      }
+
       if (sessionId) {
         const activeTransport = activeTransports[sessionId];
         if (!activeTransport) {
@@ -457,6 +494,7 @@ const handleSSERequest = async <T extends ServerLike>({
 
 export const startHTTPServer = async <T extends ServerLike>({
   apiKey,
+  authenticate,
   createServer,
   enableJsonResponse,
   eventStore,
@@ -470,6 +508,7 @@ export const startHTTPServer = async <T extends ServerLike>({
   streamEndpoint = "/mcp",
 }: {
   apiKey?: string;
+  authenticate?: (request: http.IncomingMessage) => Promise<unknown>;
   createServer: (request: http.IncomingMessage) => Promise<T>;
   enableJsonResponse?: boolean;
   eventStore?: EventStore;
@@ -508,8 +547,8 @@ export const startHTTPServer = async <T extends ServerLike>({
         res.setHeader("Access-Control-Allow-Origin", origin.origin);
         res.setHeader("Access-Control-Allow-Credentials", "true");
         res.setHeader("Access-Control-Allow-Methods", "GET, POST, OPTIONS");
-        res.setHeader("Access-Control-Allow-Headers", "*");
-        res.setHeader("Access-Control-Expose-Headers", "mcp-session-id");
+        res.setHeader("Access-Control-Allow-Headers", "Content-Type, Authorization, Accept, Mcp-Session-Id, Last-Event-Id");
+        res.setHeader("Access-Control-Expose-Headers", "Mcp-Session-Id");
       } catch (error) {
         console.error("[mcp-proxy] error parsing origin", error);
       }
@@ -553,6 +592,7 @@ export const startHTTPServer = async <T extends ServerLike>({
       streamEndpoint &&
       (await handleStreamRequest({
         activeTransports: activeStreamTransports,
+        authenticate,
         createServer,
         enableJsonResponse,
         endpoint: streamEndpoint,