diff --git a/README.md b/README.md
index d154857..948f12b 100644
--- a/README.md
+++ b/README.md
@@ -90,3 +90,23 @@ For open source projects, say how it is licensed.
 
 ## Project status
 If you have run out of energy or time for your project, put a note at the top of the README saying that development has slowed down or stopped completely. Someone may choose to fork your project or volunteer to step in as a maintainer or owner, allowing your project to keep going. You can also make an explicit request for maintainers.
+
+## Tests
+### Compaction
+Follow these steps before running the compaction test suite:
+
+1. Install the required dependencies (Java and Google Cloud CLI):
+   ```bash
+   mise use -g gcloud
+   mise use -g java
+   ```
+2. Open another terminal (or create a `tmux` pane) and start the Firestore emulator:
+   ```bash
+   gcloud emulators firestore start --host-port=localhost:8153
+   ```
+3. Execute the tests with `pytest` through `uv`:
+   ```bash
+   uv run pytest tests/test_compaction.py -v
+   ```
+
+If any step fails, double-check that the tools are installed and available on your `PATH` before trying again.
diff --git a/src/va_agent/compaction.py b/src/va_agent/compaction.py
new file mode 100644
index 0000000..e752ffd
--- /dev/null
+++ b/src/va_agent/compaction.py
@@ -0,0 +1,213 @@
+"""Session compaction utilities for managing conversation history."""
+
+from __future__ import annotations
+
+import asyncio
+import logging
+import time
+from typing import TYPE_CHECKING, Any
+
+from google.adk.events.event import Event
+from google.cloud.firestore_v1.async_transaction import async_transactional
+
+if TYPE_CHECKING:
+    from google import genai
+    from google.adk.sessions.session import Session
+    from google.cloud.firestore_v1.async_client import AsyncClient
+
+logger = logging.getLogger("google_adk." + __name__)
+
+_COMPACTION_LOCK_TTL = 300  # seconds
+
+
+@async_transactional
+async def _try_claim_compaction_txn(transaction: Any, session_ref: Any) -> bool:
+    """Atomically claim the compaction lock if it is free or stale."""
+    snapshot = await session_ref.get(transaction=transaction)
+    if not snapshot.exists:
+        return False
+    data = snapshot.to_dict() or {}
+    lock_time = data.get("compaction_lock")
+    if lock_time and (time.time() - lock_time) < _COMPACTION_LOCK_TTL:
+        return False
+    transaction.update(session_ref, {"compaction_lock": time.time()})
+    return True
+
+
+class SessionCompactor:
+    """Handles conversation history compaction for Firestore sessions.
+
+    This class manages the automatic summarization and archival of older
+    conversation events to keep token counts manageable while preserving
+    context through AI-generated summaries.
+    """
+
+    def __init__(
+        self,
+        *,
+        db: AsyncClient,
+        genai_client: genai.Client | None = None,
+        compaction_model: str = "gemini-2.5-flash",
+        compaction_keep_recent: int = 10,
+    ) -> None:
+        """Initialize SessionCompactor.
+
+        Args:
+            db: Firestore async client
+            genai_client: GenAI client for generating summaries
+            compaction_model: Model to use for summarization
+            compaction_keep_recent: Number of recent events to keep uncompacted
+
+        """
+        self._db = db
+        self._genai_client = genai_client
+        self._compaction_model = compaction_model
+        self._compaction_keep_recent = compaction_keep_recent
+        self._compaction_locks: dict[str, asyncio.Lock] = {}
+
+    @staticmethod
+    def _events_to_text(events: list[Event]) -> str:
+        """Convert a list of events to a readable conversation text format."""
+        lines: list[str] = []
+        for event in events:
+            if event.content and event.content.parts:
+                text = "".join(p.text or "" for p in event.content.parts)
+                if text:
+                    role = "User" if event.author == "user" else "Assistant"
+                    lines.append(f"{role}: {text}")
+        return "\n\n".join(lines)
+
+    async def _generate_summary(
+        self, existing_summary: str, events: list[Event]
+    ) -> str:
+        """Generate or update a conversation summary using the GenAI model."""
+        conversation_text = self._events_to_text(events)
+        previous = (
+            f"Previous summary of earlier conversation:\n{existing_summary}\n\n"
+            if existing_summary
+            else ""
+        )
+        prompt = (
+            "Summarize the following conversation between a user and an "
+            "assistant. Preserve:\n"
+            "- Key decisions and conclusions\n"
+            "- User preferences and requirements\n"
+            "- Important facts, names, and numbers\n"
+            "- The overall topic and direction of the conversation\n"
+            "- Any pending tasks or open questions\n\n"
+            f"{previous}"
+            f"Conversation:\n{conversation_text}\n\n"
+            "Provide a clear, comprehensive summary."
+        )
+        if self._genai_client is None:
+            msg = "genai_client is required for compaction"
+            raise RuntimeError(msg)
+        response = await self._genai_client.aio.models.generate_content(
+            model=self._compaction_model,
+            contents=prompt,
+        )
+        return response.text or ""
+
+    async def _compact_session(
+        self,
+        session: Session,
+        events_col_ref: Any,
+        session_ref: Any,
+    ) -> None:
+        """Perform the actual compaction: summarize old events and delete them.
+
+        Args:
+            session: The session to compact
+            events_col_ref: Firestore collection reference for events
+            session_ref: Firestore document reference for the session
+
+        """
+        query = events_col_ref.order_by("timestamp")
+        event_docs = await query.get()
+
+        if len(event_docs) <= self._compaction_keep_recent:
+            return
+
+        all_events = [Event.model_validate(doc.to_dict()) for doc in event_docs]
+        events_to_summarize = all_events[: -self._compaction_keep_recent]
+
+        session_snap = await session_ref.get()
+        existing_summary = (session_snap.to_dict() or {}).get(
+            "conversation_summary", ""
+        )
+
+        try:
+            summary = await self._generate_summary(
+                existing_summary, events_to_summarize
+            )
+        except Exception:
+            logger.exception("Compaction summary generation failed; skipping.")
+            return
+
+        # Write summary BEFORE deleting events so a crash between the two
+        # steps leaves safe duplication rather than data loss.
+        await session_ref.update({"conversation_summary": summary})
+
+        docs_to_delete = event_docs[: -self._compaction_keep_recent]
+        for i in range(0, len(docs_to_delete), 500):
+            batch = self._db.batch()
+            for doc in docs_to_delete[i : i + 500]:
+                batch.delete(doc.reference)
+            await batch.commit()
+
+        logger.info(
+            "Compacted session %s: summarised %d events, kept %d.",
+            session.id,
+            len(docs_to_delete),
+            self._compaction_keep_recent,
+        )
+
+    async def guarded_compact(
+        self,
+        session: Session,
+        events_col_ref: Any,
+        session_ref: Any,
+    ) -> None:
+        """Run compaction in the background with per-session locking.
+
+        This method ensures that only one compaction process runs at a time
+        for a given session, both locally (using asyncio locks) and across
+        multiple instances (using Firestore-backed locks).
+
+        Args:
+            session: The session to compact
+            events_col_ref: Firestore collection reference for events
+            session_ref: Firestore document reference for the session
+
+        """
+        key = f"{session.app_name}__{session.user_id}__{session.id}"
+        lock = self._compaction_locks.setdefault(key, asyncio.Lock())
+
+        if lock.locked():
+            logger.debug("Compaction already running locally for %s; skipping.", key)
+            return
+
+        async with lock:
+            try:
+                transaction = self._db.transaction()
+                claimed = await _try_claim_compaction_txn(transaction, session_ref)
+            except Exception:
+                logger.exception("Failed to claim compaction lock for %s", key)
+                return
+
+            if not claimed:
+                logger.debug(
+                    "Compaction lock held by another instance for %s; skipping.",
+                    key,
+                )
+                return
+
+            try:
+                await self._compact_session(session, events_col_ref, session_ref)
+            except Exception:
+                logger.exception("Background compaction failed for %s", key)
+            finally:
+                try:
+                    await session_ref.update({"compaction_lock": None})
+                except Exception:
+                    logger.exception("Failed to release compaction lock for %s", key)
diff --git a/src/va_agent/session.py b/src/va_agent/session.py
index bb7873a..706d7de 100644
--- a/src/va_agent/session.py
+++ b/src/va_agent/session.py
@@ -18,33 +18,18 @@ from google.adk.sessions.base_session_service import (
 )
 from google.adk.sessions.session import Session
 from google.adk.sessions.state import State
-from google.cloud.firestore_v1.async_transaction import async_transactional
 from google.cloud.firestore_v1.base_query import FieldFilter
 from google.cloud.firestore_v1.field_path import FieldPath
 from google.genai.types import Content, Part
 
+from .compaction import SessionCompactor
+
 if TYPE_CHECKING:
     from google import genai
     from google.cloud.firestore_v1.async_client import AsyncClient
 
 logger = logging.getLogger("google_adk." + __name__)
 
-_COMPACTION_LOCK_TTL = 300  # seconds
-
-
-@async_transactional
-async def _try_claim_compaction_txn(transaction: Any, session_ref: Any) -> bool:
-    """Atomically claim the compaction lock if it is free or stale."""
-    snapshot = await session_ref.get(transaction=transaction)
-    if not snapshot.exists:
-        return False
-    data = snapshot.to_dict() or {}
-    lock_time = data.get("compaction_lock")
-    if lock_time and (time.time() - lock_time) < _COMPACTION_LOCK_TTL:
-        return False
-    transaction.update(session_ref, {"compaction_lock": time.time()})
-    return True
-
 
 class FirestoreSessionService(BaseSessionService):
     """A Firestore-backed implementation of BaseSessionService.
@@ -89,10 +74,12 @@ class FirestoreSessionService(BaseSessionService):
         self._db = db
         self._prefix = collection_prefix
         self._compaction_threshold = compaction_token_threshold
-        self._compaction_model = compaction_model
-        self._compaction_keep_recent = compaction_keep_recent
-        self._genai_client = genai_client
-        self._compaction_locks: dict[str, asyncio.Lock] = {}
+        self._compactor = SessionCompactor(
+            db=db,
+            genai_client=genai_client,
+            compaction_model=compaction_model,
+            compaction_keep_recent=compaction_keep_recent,
+        )
         self._active_tasks: set[asyncio.Task] = set()
 
     # ------------------------------------------------------------------
@@ -140,136 +127,6 @@ class FirestoreSessionService(BaseSessionService):
             merged[State.USER_PREFIX + key] = value
         return merged
 
-    # ------------------------------------------------------------------
-    # Compaction helpers
-    # ------------------------------------------------------------------
-
-    @staticmethod
-    def _events_to_text(events: list[Event]) -> str:
-        lines: list[str] = []
-        for event in events:
-            if event.content and event.content.parts:
-                text = "".join(p.text or "" for p in event.content.parts)
-                if text:
-                    role = "User" if event.author == "user" else "Assistant"
-                    lines.append(f"{role}: {text}")
-        return "\n\n".join(lines)
-
-    async def _generate_summary(
-        self, existing_summary: str, events: list[Event]
-    ) -> str:
-        conversation_text = self._events_to_text(events)
-        previous = (
-            f"Previous summary of earlier conversation:\n{existing_summary}\n\n"
-            if existing_summary
-            else ""
-        )
-        prompt = (
-            "Summarize the following conversation between a user and an "
-            "assistant. Preserve:\n"
-            "- Key decisions and conclusions\n"
-            "- User preferences and requirements\n"
-            "- Important facts, names, and numbers\n"
-            "- The overall topic and direction of the conversation\n"
-            "- Any pending tasks or open questions\n\n"
-            f"{previous}"
-            f"Conversation:\n{conversation_text}\n\n"
-            "Provide a clear, comprehensive summary."
-        )
-        if self._genai_client is None:
-            msg = "genai_client is required for compaction"
-            raise RuntimeError(msg)
-        response = await self._genai_client.aio.models.generate_content(
-            model=self._compaction_model,
-            contents=prompt,
-        )
-        return response.text or ""
-
-    async def _compact_session(self, session: Session) -> None:
-        app_name = session.app_name
-        user_id = session.user_id
-        session_id = session.id
-
-        events_ref = self._events_col(app_name, user_id, session_id)
-        query = events_ref.order_by("timestamp")
-        event_docs = await query.get()
-
-        if len(event_docs) <= self._compaction_keep_recent:
-            return
-
-        all_events = [Event.model_validate(doc.to_dict()) for doc in event_docs]
-        events_to_summarize = all_events[: -self._compaction_keep_recent]
-
-        session_snap = await self._session_ref(app_name, user_id, session_id).get()
-        existing_summary = (session_snap.to_dict() or {}).get(
-            "conversation_summary", ""
-        )
-
-        try:
-            summary = await self._generate_summary(
-                existing_summary, events_to_summarize
-            )
-        except Exception:
-            logger.exception("Compaction summary generation failed; skipping.")
-            return
-
-        # Write summary BEFORE deleting events so a crash between the two
-        # steps leaves safe duplication rather than data loss.
-        await self._session_ref(app_name, user_id, session_id).update(
-            {"conversation_summary": summary}
-        )
-
-        docs_to_delete = event_docs[: -self._compaction_keep_recent]
-        for i in range(0, len(docs_to_delete), 500):
-            batch = self._db.batch()
-            for doc in docs_to_delete[i : i + 500]:
-                batch.delete(doc.reference)
-            await batch.commit()
-
-        logger.info(
-            "Compacted session %s: summarised %d events, kept %d.",
-            session_id,
-            len(docs_to_delete),
-            self._compaction_keep_recent,
-        )
-
-    async def _guarded_compact(self, session: Session) -> None:
-        """Run compaction in the background with per-session locking."""
-        key = f"{session.app_name}__{session.user_id}__{session.id}"
-        lock = self._compaction_locks.setdefault(key, asyncio.Lock())
-
-        if lock.locked():
-            logger.debug("Compaction already running locally for %s; skipping.", key)
-            return
-
-        async with lock:
-            session_ref = self._session_ref(
-                session.app_name, session.user_id, session.id
-            )
-            try:
-                transaction = self._db.transaction()
-                claimed = await _try_claim_compaction_txn(transaction, session_ref)
-            except Exception:
-                logger.exception("Failed to claim compaction lock for %s", key)
-                return
-
-            if not claimed:
-                logger.debug(
-                    "Compaction lock held by another instance for %s; skipping.",
-                    key,
-                )
-                return
-
-            try:
-                await self._compact_session(session)
-            except Exception:
-                logger.exception("Background compaction failed for %s", key)
-            finally:
-                try:
-                    await session_ref.update({"compaction_lock": None})
-                except Exception:
-                    logger.exception("Failed to release compaction lock for %s", key)
-
     async def close(self) -> None:
         """Await all in-flight compaction tasks. Call before shutdown."""
         if self._active_tasks:
@@ -567,7 +424,11 @@ class FirestoreSessionService(BaseSessionService):
                 event.usage_metadata.total_token_count,
                 self._compaction_threshold,
             )
-            task = asyncio.create_task(self._guarded_compact(session))
+            events_ref = self._events_col(app_name, user_id, session_id)
+            session_ref = self._session_ref(app_name, user_id, session_id)
+            task = asyncio.create_task(
+                self._compactor.guarded_compact(session, events_ref, session_ref)
+            )
             self._active_tasks.add(task)
             task.add_done_callback(self._active_tasks.discard)
 
diff --git a/tests/test_compaction.py b/tests/test_compaction.py
index 3e7b232..eca75a2 100644
--- a/tests/test_compaction.py
+++ b/tests/test_compaction.py
@@ -14,7 +14,8 @@ from google.adk.events.event import Event
 from google.cloud.firestore_v1.async_client import AsyncClient
 from google.genai.types import Content, GenerateContentResponseUsageMetadata, Part
 
-from va_agent.session import FirestoreSessionService, _try_claim_compaction_txn
+from va_agent.session import FirestoreSessionService
+from va_agent.compaction import SessionCompactor, _try_claim_compaction_txn
 
 pytestmark = pytest.mark.asyncio
 
@@ -178,7 +179,9 @@ class TestCompactionEdgeCases:
             await compaction_service.append_event(session, e)
 
         # Trigger compaction manually even though threshold wouldn't fire
-        await compaction_service._compact_session(session)
+        events_ref = compaction_service._events_col(app_name, user_id, session.id)
+        session_ref = compaction_service._session_ref(app_name, user_id, session.id)
+        await compaction_service._compactor._compact_session(session, events_ref, session_ref)
 
         mock_genai_client.aio.models.generate_content.assert_not_called()
 
@@ -205,7 +208,9 @@ class TestCompactionEdgeCases:
         )
 
         # Should not raise
-        await compaction_service._compact_session(session)
+        events_ref = compaction_service._events_col(app_name, user_id, session.id)
+        session_ref = compaction_service._session_ref(app_name, user_id, session.id)
+        await compaction_service._compactor._compact_session(session, events_ref, session_ref)
 
         # All events should still be present
         fetched = await compaction_service.get_session(
@@ -268,7 +273,7 @@ class TestEventsToText:
                 invocation_id="inv-2",
             ),
         ]
-        text = FirestoreSessionService._events_to_text(events)
+        text = SessionCompactor._events_to_text(events)
         assert "User: Hi there" in text
         assert "Assistant: Hello!" in text
 
@@ -280,7 +285,7 @@ class TestEventsToText:
                 invocation_id="inv-1",
             ),
         ]
-        text = FirestoreSessionService._events_to_text(events)
+        text = SessionCompactor._events_to_text(events)
         assert text == ""
 
 
@@ -368,11 +373,15 @@ class TestGuardedCompact:
 
         # Hold the in-process lock so _guarded_compact skips
         key = f"{app_name}__{user_id}__{session.id}"
-        lock = compaction_service._compaction_locks.setdefault(
+        lock = compaction_service._compactor._compaction_locks.setdefault(
             key, asyncio.Lock()
         )
+        events_ref = compaction_service._events_col(app_name, user_id, session.id)
+        session_ref = compaction_service._session_ref(app_name, user_id, session.id)
         async with lock:
-            await compaction_service._guarded_compact(session)
+            await compaction_service._compactor.guarded_compact(
+                session, events_ref, session_ref
+            )
 
         mock_genai_client.aio.models.generate_content.assert_not_called()
 
@@ -399,7 +408,10 @@ class TestGuardedCompact:
         )
         await session_ref.update({"compaction_lock": time.time()})
 
-        await compaction_service._guarded_compact(session)
+        events_ref = compaction_service._events_col(app_name, user_id, session.id)
+        await compaction_service._compactor.guarded_compact(
+            session, events_ref, session_ref
+        )
 
         mock_genai_client.aio.models.generate_content.assert_not_called()
 
@@ -411,10 +423,18 @@ class TestGuardedCompact:
         )
 
         with patch(
-            "va_agent.session._try_claim_compaction_txn",
+            "va_agent.compaction._try_claim_compaction_txn",
             side_effect=RuntimeError("Firestore down"),
         ):
-            await compaction_service._guarded_compact(session)
+            events_ref = compaction_service._events_col(
+                app_name, user_id, session.id
+            )
+            session_ref = compaction_service._session_ref(
+                app_name, user_id, session.id
+            )
+            await compaction_service._compactor.guarded_compact(
+                session, events_ref, session_ref
+            )
 
         mock_genai_client.aio.models.generate_content.assert_not_called()
 
@@ -427,11 +447,19 @@ class TestGuardedCompact:
 
         # Make _compact_session raise an unhandled exception
         with patch.object(
-            compaction_service,
+            compaction_service._compactor,
             "_compact_session",
             side_effect=RuntimeError("unexpected crash"),
         ):
-            await compaction_service._guarded_compact(session)
+            events_ref = compaction_service._events_col(
+                app_name, user_id, session.id
+            )
+            session_ref = compaction_service._session_ref(
+                app_name, user_id, session.id
+            )
+            await compaction_service._compactor.guarded_compact(
+                session, events_ref, session_ref
+            )
 
         # Lock should be released even after failure
         session_ref = compaction_service._session_ref(
@@ -467,7 +495,11 @@ class TestGuardedCompact:
             side_effect=patched_session_ref,
         ):
             # Should not raise despite lock release failure
-            await compaction_service._guarded_compact(session)
+            events_ref = compaction_service._events_col(app_name, user_id, session.id)
+            session_ref = compaction_service._session_ref(app_name, user_id, session.id)
+            await compaction_service._compactor.guarded_compact(
+                session, events_ref, session_ref
+            )
 
 
 # ------------------------------------------------------------------