diff --git a/examples/237-cleanup-body-restrictions.sx b/examples/237-cleanup-body-restrictions.sx
new file mode 100644
index 0000000..b47fc0d
--- /dev/null
+++ b/examples/237-cleanup-body-restrictions.sx
@@ -0,0 +1,26 @@
+// Cleanup-body control-flow restrictions (ERR step E1.7 follow-up). A `defer`
+// or `onfail` body runs while the block/function is already exiting, so it has
+// no target to transfer control to: `raise` / `try` / `return` / `break` /
+// `continue` are all rejected inside one. The ban is transitive through nested
+// `catch` bodies and loops, but NOT through a nested closure (its own function
+// boundary). `raise` was already banned (E1.3); this adds the other four.
+// This file is expected to FAIL compilation (exit 1).
+//
+// Run: ./zig-out/bin/sx run examples/237-cleanup-body-restrictions.sx
+
+#import "modules/std.sx";
+
+E :: error { Bad }
+
+g :: () -> !E { return; }
+
+f :: () -> !E {
+    defer  { return; }                 // ERROR: return in defer body
+    onfail { try g(); }                // ERROR: try in onfail body
+    defer  { for 0..1: (i) { break; } }   // ERROR: break in defer body (transitive through loop)
+    onfail e { if e == error.Bad { continue; } }  // ERROR: continue in onfail body
+    try g();
+    return;
+}
+
+main :: () -> s32 { return 0; }
diff --git a/src/parser.zig b/src/parser.zig
index f59cec2..501ee57 100644
--- a/src/parser.zig
+++ b/src/parser.zig
@@ -2007,6 +2007,7 @@ pub const Parser = struct {
 
         // Return statement: return expr; or return;
         if (self.current.tag == .kw_return) {
+            try self.rejectInCleanup("return");
             const start = self.current.loc.start;
             self.advance();
             if (self.current.tag == .semicolon) {
@@ -2071,6 +2072,7 @@ pub const Parser = struct {
 
         // Break statement: break;
         if (self.current.tag == .kw_break) {
+            try self.rejectInCleanup("break");
             const start = self.current.loc.start;
             self.advance();
             try self.expect(.semicolon);
@@ -2079,6 +2081,7 @@ pub const Parser = struct {
 
         // Continue statement: continue;
         if (self.current.tag == .kw_continue) {
+            try self.rejectInCleanup("continue");
             const start = self.current.loc.start;
             self.advance();
             try self.expect(.semicolon);
@@ -2329,6 +2332,7 @@ pub const Parser = struct {
         // stack by adjacency (`xx try foo()` = `xx (try foo())`). Failability
         // of the operand is a sema check (E1.4), not a parse-time restriction.
         if (self.current.tag == .kw_try) {
+            try self.rejectInCleanup("try");
             const start = self.current.loc.start;
             self.advance();
             const operand = try self.parseUnary();
@@ -3325,6 +3329,19 @@ pub const Parser = struct {
         // Optional calling convention: callconv(.c)
         const call_conv = try self.parseOptionalCallConv();
 
+        // A closure is its own function boundary: clear the cleanup-body flags
+        // so control-flow exits inside the closure body (`return` from the
+        // closure, etc.) are legal even when the closure literal appears inside
+        // a `defer` / `onfail` body. Restored after the body.
+        const saved_onfail = self.in_onfail_body;
+        const saved_defer = self.in_defer_body;
+        self.in_onfail_body = false;
+        self.in_defer_body = false;
+        defer {
+            self.in_onfail_body = saved_onfail;
+            self.in_defer_body = saved_defer;
+        }
+
         // Two body forms:
         // (params) => expr          — expression lambda
         // (params) { stmts }        — block-body lambda
@@ -3607,6 +3624,29 @@ pub const Parser = struct {
         return self.fail(msg);
     }
 
+    /// A cleanup body is a `defer` or `onfail` body. Control-flow exits
+    /// (`raise` / `try` / `return` / `break` / `continue`) are banned inside one:
+    /// cleanup runs while the block/function is already exiting, so there is
+    /// nothing to propagate or transfer to. The ban is transitive through nested
+    /// `catch` bodies and loops, but NOT through a nested closure body — a
+    /// closure is its own function boundary (parseLambda clears the flags).
+    fn inCleanupBody(self: *const Parser) bool {
+        return self.in_onfail_body or self.in_defer_body;
+    }
+
+    /// The cleanup-body phrase for diagnostics, with article (`onfail` takes
+    /// precedence when both are set, e.g. an `onfail` nested in a `defer`).
+    fn cleanupKind(self: *const Parser) []const u8 {
+        return if (self.in_onfail_body) "an `onfail`" else "a `defer`";
+    }
+
+    /// Reject a control-flow exit `kw` (e.g. "return") inside a cleanup body.
+    fn rejectInCleanup(self: *Parser, comptime kw: []const u8) error{ParseError}!void {
+        if (self.inCleanupBody()) {
+            return self.failFmt("`" ++ kw ++ "` is not allowed inside {s} body — cleanup runs while the function is already exiting, so there is nothing to transfer control to", .{self.cleanupKind()});
+        }
+    }
+
     fn tokenSlice(self: *const Parser, token: Token) []const u8 {
         return self.source[token.loc.start..token.loc.end];
     }
@@ -4274,6 +4314,51 @@ test "E1.3 raise rejected inside a defer body" {
     try std.testing.expectError(error.ParseError, parser.parse());
 }
 
+test "E1.7 return rejected inside a defer body" {
+    var arena = std.heap.ArenaAllocator.init(std.testing.allocator);
+    defer arena.deinit();
+    var parser = Parser.init(arena.allocator(), "f :: () { defer { return; } }");
+    try std.testing.expectError(error.ParseError, parser.parse());
+}
+
+test "E1.7 try rejected inside an onfail body" {
+    var arena = std.heap.ArenaAllocator.init(std.testing.allocator);
+    defer arena.deinit();
+    var parser = Parser.init(arena.allocator(), "f :: () { onfail { try g(); } }");
+    try std.testing.expectError(error.ParseError, parser.parse());
+}
+
+test "E1.7 break rejected inside a defer body (transitive through a loop)" {
+    var arena = std.heap.ArenaAllocator.init(std.testing.allocator);
+    defer arena.deinit();
+    var parser = Parser.init(arena.allocator(), "f :: () { defer { for 0..1: (i) { break; } } }");
+    try std.testing.expectError(error.ParseError, parser.parse());
+}
+
+test "E1.7 continue rejected inside an onfail body" {
+    var arena = std.heap.ArenaAllocator.init(std.testing.allocator);
+    defer arena.deinit();
+    var parser = Parser.init(arena.allocator(), "f :: () { onfail e { continue; } }");
+    try std.testing.expectError(error.ParseError, parser.parse());
+}
+
+test "E1.7 return inside a closure within a cleanup body is allowed" {
+    // A closure is its own function boundary: parseLambda clears the cleanup
+    // flags, so `return` from the closure body is legal even inside `defer`.
+    var arena = std.heap.ArenaAllocator.init(std.testing.allocator);
+    defer arena.deinit();
+    var parser = Parser.init(arena.allocator(), "f :: () { defer g((x: s32) -> s32 { return x; }); }");
+    _ = try parser.parse();
+}
+
+test "E1.7 control-flow legal again after the cleanup body (flag restored)" {
+    // The cleanup-body flag must not leak to statements that follow the defer.
+    var arena = std.heap.ArenaAllocator.init(std.testing.allocator);
+    defer arena.deinit();
+    var parser = Parser.init(arena.allocator(), "f :: () { defer cleanup(); return; }");
+    _ = try parser.parse();
+}
+
 test "E0.2 onfail with binding and block body" {
     var arena = std.heap.ArenaAllocator.init(std.testing.allocator);
     defer arena.deinit();
diff --git a/tests/expected/237-cleanup-body-restrictions.exit b/tests/expected/237-cleanup-body-restrictions.exit
new file mode 100644
index 0000000..d00491f
--- /dev/null
+++ b/tests/expected/237-cleanup-body-restrictions.exit
@@ -0,0 +1 @@
+1
diff --git a/tests/expected/237-cleanup-body-restrictions.txt b/tests/expected/237-cleanup-body-restrictions.txt
new file mode 100644
index 0000000..5dfdd06
--- /dev/null
+++ b/tests/expected/237-cleanup-body-restrictions.txt
@@ -0,0 +1,5 @@
+error: `return` is not allowed inside a `defer` body — cleanup runs while the function is already exiting, so there is nothing to transfer control to
+  --> /Users/agra/projects/sx/examples/237-cleanup-body-restrictions.sx:18:14
+   |
+18 |     defer  { return; }                 // ERROR: return in defer body
+   |              ^^^^^^