diff --git a/apps/web/src/components/Sidebar.drag.test.ts b/apps/web/src/components/Sidebar.drag.test.ts
index 1058dfcd88595c943f0669b6e974f44b4f2f8d8d..c757eca87aa4addb79b1f618475983c211333a05 100644
--- a/apps/web/src/components/Sidebar.drag.test.ts
+++ b/apps/web/src/components/Sidebar.drag.test.ts
@@ -253,6 +253,37 @@ describe("sidebar collision detection", () => {
 });
 
 describe("sidebar drag projection", () => {
+  it.each([
+    ["a1", "a2"],
+    ["a1", sidebarMarkerId("settled-header")],
+    ["z", "a2"],
+  ])("keeps sparse shelves at the bottom when dragging %s over %s", (active, over) => {
+    const items = [
+      pinnedHeader,
+      divider,
+      thread("a1", "active"),
+      thread("a2", "active"),
+      marker("snoozed-header"),
+      thread("z", "snoozed"),
+      settledHeader,
+      thread("s", "settled"),
+    ];
+    const strategy = createSidebarSortingStrategy({
+      items,
+      settledOrder: over === sidebarMarkerId("settled-header") ? ["a1", "s"] : ["s"],
+      settledExpanded: true,
+      boundaryLabelHeight: 24,
+      snoozedThreadCount: 1,
+    });
+    const args = layout(items, active, over);
+    for (const rect of args.rects.slice(4)) {
+      rect.top += 400;
+      rect.bottom += 400;
+    }
+    const lastIndex = items.length - 1;
+    expect(strategy({ ...args, index: lastIndex })).toEqual(stationary);
+  });
+
   const pinned = [
     pinnedHeader,
     thread("p1", "pinned"),
diff --git a/apps/web/src/components/Sidebar.drag.ts b/apps/web/src/components/Sidebar.drag.ts
index c64de1c27b756365350e26aeb74041226767dbb1..0b5710c671fcfa90c3b44aca301aeb91b320c3ff 100644
--- a/apps/web/src/components/Sidebar.drag.ts
+++ b/apps/web/src/components/Sidebar.drag.ts
@@ -194,27 +194,58 @@ export function createSidebarSortingStrategy(input: {
     }
     marker("settled-header");
     section("settled");
-    const result = items.map(() => hidden);
-    let top = rects[0].top;
-    for (const item of projected) {
+    const heights = projected.map((item) => {
       const index = indices.get(sidebarListItemId(item));
       const rect = index === undefined ? undefined : rects[index];
-      if (index !== undefined && rect) result[index] = { ...stationary, y: top - rect.top };
       const fallback =
         item.kind === "thread" && (item.section === "pinned" || item.section === "active")
           ? cardHeight
           : slimHeight;
       const moved = item.kind === "thread" && item.key === active.key;
-      const height =
-        item.kind === "marker" &&
+      return item.kind === "marker" &&
         (item.marker === "pinned-header" || item.marker === "pinned-divider")
-          ? labelHeight
-          : item.kind === "marker" && item.marker.endsWith("placeholder")
-            ? slimHeight
-            : moved
-              ? fallback
-              : (rect?.height ?? fallback);
-      top += height + 1;
+        ? labelHeight
+        : item.kind === "marker" && item.marker.endsWith("placeholder")
+          ? slimHeight
+          : moved
+            ? fallback
+            : (rect?.height ?? fallback);
+    });
+    const firstShelf = items.findIndex(
+      (item) =>
+        item.kind === "marker" &&
+        (item.marker === "snoozed-header" || item.marker === "settled-header"),
+    );
+    const shelfRect = rects[firstShelf];
+    const beforeShelf = rects[firstShelf - 1];
+    const lastRect = rects.at(-1);
+    // Consume the shelf's auto margin as drag labels and resized rows need
+    // room, keeping the combined shelves at their measured bottom.
+    let shelfSpace =
+      !input.compact &&
+      shelfRect &&
+      beforeShelf &&
+      lastRect &&
+      shelfRect.top > beforeShelf.bottom + 1
+        ? Math.max(
+            0,
+            lastRect.bottom - rects[0].top - heights.reduce((sum, height) => sum + height + 1, -1),
+          )
+        : 0;
+    const result = items.map(() => hidden);
+    let top = rects[0].top;
+    for (const [projectedIndex, item] of projected.entries()) {
+      if (
+        item.kind === "marker" &&
+        (item.marker === "snoozed-header" || item.marker === "settled-header")
+      ) {
+        top += shelfSpace;
+        shelfSpace = 0;
+      }
+      const index = indices.get(sidebarListItemId(item));
+      const rect = index === undefined ? undefined : rects[index];
+      if (index !== undefined && rect) result[index] = { ...stationary, y: top - rect.top };
+      top += heights[projectedIndex]! + 1;
     }
     result[activeIndex] = stationary;
     return result;
diff --git a/apps/web/src/components/Sidebar.tsx b/apps/web/src/components/Sidebar.tsx
index 1b850f1875ba9fa12f401a31c8908fdcec492fa3..a86bb9a3868e1d38ebae4676950af51bd346bc22 100644
--- a/apps/web/src/components/Sidebar.tsx
+++ b/apps/web/src/components/Sidebar.tsx
@@ -661,6 +661,7 @@ function SidebarDragBoundary(props: {
 function SidebarSectionHeader(props: {
   marker: "snoozed-header" | "settled-header";
   label: string;
+  className?: string;
   // While dragging, the settled header reads at full strength and takes the
   // accent while the lifted row is over it.
   dragging?: boolean;
@@ -712,7 +713,7 @@ function SidebarSectionHeader(props: {
     <SortableSidebarMarker
       marker={props.marker}
       data-testid={`sidebar-${props.marker}`}
-      className="mx-0.5 h-8"
+      className={cn("mx-0.5 h-8", props.className)}
     >
       <Tooltip disabled={!compact}>
         <TooltipTrigger
@@ -4541,7 +4542,10 @@ export default function Sidebar() {
     <>
       <SidebarChromeHeader isElectron={isElectron} />
       <SidebarContent
-        className={cn("gap-0", compact && "group-data-[collapsible=icon]:overflow-visible")}
+        className={cn(
+          "gap-0",
+          compact ? "group-data-[collapsible=icon]:overflow-visible" : "min-h-full",
+        )}
         fixedFooter={
           compact && !isSearchingThreads && snoozedThreads.length > 0 ? (
             <ul
@@ -4717,7 +4721,12 @@ export default function Sidebar() {
           </SidebarGroup>
         }
       >
-        <SidebarGroup className="ps-[calc(var(--sidebar-content-inset)+1px)] pe-[var(--sidebar-content-inset)] pb-1 pt-0">
+        <SidebarGroup
+          className={cn(
+            "ps-[calc(var(--sidebar-content-inset)+1px)] pe-[var(--sidebar-content-inset)] pb-1 pt-0",
+            !compact && "flex-1",
+          )}
+        >
           {isSearchingThreads ? (
             threadSearchResults.length > 0 ? (
               <TooltipProvider
@@ -4806,7 +4815,10 @@ export default function Sidebar() {
                   <ul
                     ref={attachListMotionRef}
                     role="list"
-                    className="relative flex flex-col gap-px"
+                    className={cn(
+                      "relative flex flex-col gap-px",
+                      !compact && sidebarListItems.length > 0 && "flex-1",
+                    )}
                   >
                     {(() => {
                       const renderThreadRowInner = (
@@ -5021,6 +5033,7 @@ export default function Sidebar() {
                               <SidebarSectionHeader
                                 key="snoozed-shelf-header"
                                 marker="snoozed-header"
+                                className={cn(!compact && "mt-auto")}
                                 label={
                                   snoozedShelfExpanded
                                     ? "Snoozed"
@@ -5038,6 +5051,7 @@ export default function Sidebar() {
                               <SidebarSectionHeader
                                 key="settled-shelf-header"
                                 marker="settled-header"
+                                className={cn(!compact && snoozedThreads.length === 0 && "mt-auto")}
                                 label={
                                   settledShelfExpanded
                                     ? "Settled"