diff --git a/backend/src/services/streamStore.pauseResume.integration.test.ts b/backend/src/services/streamStore.pauseResume.integration.test.ts
new file mode 100644
index 0000000..29bd9f3
--- /dev/null
+++ b/backend/src/services/streamStore.pauseResume.integration.test.ts
@@ -0,0 +1,242 @@
+import { afterAll, beforeAll, beforeEach, describe, expect, it, vi } from "vitest";
+import request from "supertest";
+import jwt from "jsonwebtoken";
+import { app } from "../index";
+import { initDb, getDb } from "./db";
+import { getStreamHistory } from "./eventHistory";
+import { getJwtSecret } from "./auth";
+import path from "path";
+import fs from "fs";
+
+const TEST_DB_PATH = path.join(__dirname, "..", "..", "data", "test-pause-resume-streams.db");
+const TEST_SECRET = "test_secret_for_pause_resume_integration";
+
+describe("POST /api/streams/:id/pause and /api/streams/:id/resume Integration Tests", () => {
+  let authToken: string;
+  let recipientToken: string;
+  const mockSender = "GAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAWHF";
+  const mockRecipient = "GBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB";
+
+  beforeAll(async () => {
+    vi.stubEnv('JWT_SECRET', TEST_SECRET);
+    process.env.DB_PATH = TEST_DB_PATH;
+    initDb();
+
+    authToken = jwt.sign({ accountId: mockSender }, getJwtSecret(), { expiresIn: '1h' });
+    recipientToken = jwt.sign({ accountId: mockRecipient }, getJwtSecret(), { expiresIn: '1h' });
+  });
+
+  beforeEach(() => {
+    const db = getDb();
+    db.exec("DELETE FROM stream_events");
+    db.exec("DELETE FROM webhook_deliveries");
+    db.exec("DELETE FROM streams");
+  });
+
+  afterAll(() => {
+    const db = getDb();
+    db.close();
+    if (fs.existsSync(TEST_DB_PATH)) {
+      fs.unlinkSync(TEST_DB_PATH);
+    }
+  });
+
+  function insertActiveStream(id: string, overrides: Record<string, any> = {}) {
+    const now = Math.floor(Date.now() / 1000);
+    const defaults: Record<string, any> = {
+      id,
+      sender: mockSender,
+      recipient: mockRecipient,
+      asset_code: "USDC",
+      total_amount: 1000,
+      duration_seconds: 3600,
+      start_at: now - 1800,
+      created_at: now - 3600,
+    };
+    const merged = { ...defaults, ...overrides };
+
+    const db = getDb();
+    db.prepare(`
+      INSERT INTO streams (id, sender, recipient, asset_code, total_amount, duration_seconds, start_at, created_at, paused_at, paused_duration)
+      VALUES (@id, @sender, @recipient, @asset_code, @total_amount, @duration_seconds, @start_at, @created_at, @paused_at, @paused_duration)
+    `).run({
+      paused_at: null,
+      paused_duration: 0,
+      ...merged,
+    });
+  }
+
+  describe("Pause active stream", () => {
+    it("should pause an active stream and return 200 with pausedAt set", async () => {
+      insertActiveStream("1");
+
+      const response = await request(app)
+        .post("/api/streams/1/pause")
+        .set("Authorization", `Bearer ${authToken}`);
+
+      expect(response.status).toBe(200);
+      expect(response.body.data).toMatchObject({
+        id: "1",
+        sender: mockSender,
+        recipient: mockRecipient,
+        progress: {
+          status: "paused",
+        },
+      });
+      expect(response.body.data.pausedAt).toBeDefined();
+      expect(response.body.data.pausedAt).toBeGreaterThanOrEqual(Math.floor(Date.now() / 1000) - 5);
+
+      const history = getStreamHistory("1");
+      const pausedEvent = history.find(e => e.eventType === "paused");
+      expect(pausedEvent).toBeDefined();
+      expect(pausedEvent?.actor).toBe(mockSender);
+    });
+  });
+
+  describe("Resume paused stream", () => {
+    it("should resume a paused stream and return 200 with pausedDuration updated", async () => {
+      const now = Math.floor(Date.now() / 1000);
+      insertActiveStream("2", { paused_at: now - 300 });
+
+      const response = await request(app)
+        .post("/api/streams/2/resume")
+        .set("Authorization", `Bearer ${authToken}`);
+
+      expect(response.status).toBe(200);
+      expect(response.body.data).toMatchObject({
+        id: "2",
+        sender: mockSender,
+        recipient: mockRecipient,
+        progress: {
+          status: "active",
+        },
+      });
+      expect(response.body.data.pausedAt).toBeUndefined();
+      expect(response.body.data.pausedDuration).toBeGreaterThanOrEqual(300);
+
+      const history = getStreamHistory("2");
+      const resumedEvent = history.find(e => e.eventType === "resumed");
+      expect(resumedEvent).toBeDefined();
+      expect(resumedEvent?.actor).toBe(mockSender);
+      expect(resumedEvent?.metadata?.pausedDuration).toBeGreaterThanOrEqual(300);
+    });
+  });
+
+  describe("Pause already-paused stream", () => {
+    it("should return 400 when trying to pause an already-paused stream", async () => {
+      const now = Math.floor(Date.now() / 1000);
+      insertActiveStream("3", { paused_at: now - 120 });
+
+      const response = await request(app)
+        .post("/api/streams/3/pause")
+        .set("Authorization", `Bearer ${authToken}`);
+
+      expect(response.status).toBe(400);
+      expect(response.body.error).toBe("Only active streams can be paused.");
+    });
+  });
+
+  describe("Resume non-paused stream", () => {
+    it("should return 400 when trying to resume a non-paused stream", async () => {
+      insertActiveStream("4");
+
+      const response = await request(app)
+        .post("/api/streams/4/resume")
+        .set("Authorization", `Bearer ${authToken}`);
+
+      expect(response.status).toBe(400);
+      expect(response.body.error).toBe("Stream is not paused.");
+    });
+  });
+
+  describe("Pause nonexistent stream", () => {
+    it("should return 404 when pausing a nonexistent stream", async () => {
+      const response = await request(app)
+        .post("/api/streams/999/pause")
+        .set("Authorization", `Bearer ${authToken}`);
+
+      expect(response.status).toBe(404);
+      expect(response.body.error).toBe("Stream not found.");
+    });
+  });
+
+  describe("Resume nonexistent stream", () => {
+    it("should return 404 when resuming a nonexistent stream", async () => {
+      const response = await request(app)
+        .post("/api/streams/999/resume")
+        .set("Authorization", `Bearer ${authToken}`);
+
+      expect(response.status).toBe(404);
+      expect(response.body.error).toBe("Stream not found.");
+    });
+  });
+
+  describe("Authorization - pause", () => {
+    it("should return 403 when non-sender tries to pause stream", async () => {
+      insertActiveStream("6");
+
+      const response = await request(app)
+        .post("/api/streams/6/pause")
+        .set("Authorization", `Bearer ${recipientToken}`);
+
+      expect(response.status).toBe(403);
+      expect(response.body.error).toBe("Only the sender can pause this stream.");
+    });
+
+    it("should return 401 when no auth token provided", async () => {
+      const response = await request(app)
+        .post("/api/streams/1/pause");
+
+      expect(response.status).toBe(401);
+    });
+  });
+
+  describe("Authorization - resume", () => {
+    it("should return 403 when non-sender tries to resume stream", async () => {
+      const now = Math.floor(Date.now() / 1000);
+      insertActiveStream("7", { paused_at: now - 120 });
+
+      const response = await request(app)
+        .post("/api/streams/7/resume")
+        .set("Authorization", `Bearer ${recipientToken}`);
+
+      expect(response.status).toBe(403);
+      expect(response.body.error).toBe("Only the sender can resume this stream.");
+    });
+
+    it("should return 401 when no auth token provided", async () => {
+      const response = await request(app)
+        .post("/api/streams/1/resume");
+
+      expect(response.status).toBe(401);
+    });
+  });
+
+  describe("Event history verification", () => {
+    it("should record pause and resume events in order", async () => {
+      const now = Math.floor(Date.now() / 1000);
+      insertActiveStream("8");
+
+      // Pause
+      const pauseRes = await request(app)
+        .post("/api/streams/8/pause")
+        .set("Authorization", `Bearer ${authToken}`);
+      expect(pauseRes.status).toBe(200);
+
+      let history = getStreamHistory("8");
+      expect(history.filter(e => e.eventType === "paused")).toHaveLength(1);
+      expect(history.filter(e => e.eventType === "resumed")).toHaveLength(0);
+
+      // Resume
+      const resumeRes = await request(app)
+        .post("/api/streams/8/resume")
+        .set("Authorization", `Bearer ${authToken}`);
+      expect(resumeRes.status).toBe(200);
+
+      history = getStreamHistory("8");
+      expect(history.filter(e => e.eventType === "paused")).toHaveLength(1);
+      expect(history.filter(e => e.eventType === "resumed")).toHaveLength(1);
+      expect(history.map(e => e.eventType)).toEqual(["paused", "resumed"]);
+    });
+  });
+});
\ No newline at end of file
diff --git a/backend/src/services/streamStore.ts b/backend/src/services/streamStore.ts
index 71eb6d0..4c81500 100644
--- a/backend/src/services/streamStore.ts
+++ b/backend/src/services/streamStore.ts
@@ -1173,6 +1173,51 @@ export async function pauseStream(id: string): Promise<StreamRecord> {
   }
 
   stream.pausedAt = nowInSeconds();
+
+  // Submit on-chain pause_stream transaction before updating local state.
+  try {
+    const sorobanContext = getSorobanContext();
+    if (sorobanContext && rpcServer && serverKeypair) {
+      const contractId = process.env.CONTRACT_ID;
+      if (contractId) {
+        const sourceAccount = await rpcServer.getAccount(serverKeypair.publicKey());
+        const contract = new Contract(contractId);
+        const tx = contract.call(
+          "pause_stream",
+          nativeToScVal(parseInt(id), { type: "u64" }),
+          new Address(stream.sender).toScVal(),
+        );
+
+        const built = await rpcServer.prepareTransaction(
+          new TransactionBuilder(sourceAccount, {
+            fee: "1000",
+            networkPassphrase: process.env.NETWORK_PASSPHRASE || Networks.TESTNET,
+          })
+            .addOperation(tx)
+            .setTimeout(30)
+            .build(),
+        );
+
+        built.sign(serverKeypair);
+        const sendRes = await retryWithBackoff(() => rpcServer!.sendTransaction(built));
+        if (sendRes.status === "PENDING") {
+          let txResult;
+          let attempts = 0;
+          while (attempts < 10) {
+            txResult = await retryWithBackoff(() =>
+              rpcServer!.getTransaction(sendRes.hash),
+            );
+            if (txResult.status !== "NOT_FOUND") break;
+            await new Promise((r) => setTimeout(r, 1000));
+            attempts++;
+          }
+        }
+      }
+    }
+  } catch (err) {
+    logger.warn({ err, streamId: id }, "failed to pause stream on chain");
+  }
+
   const db = getDb();
   db.transaction(() => {
     upsertStream(stream);
@@ -1209,6 +1254,50 @@ export async function resumeStream(id: string): Promise<StreamRecord> {
   stream.durationSeconds += elapsed;
   stream.pausedAt = undefined;
 
+  // Submit on-chain resume_stream transaction before updating local state.
+  try {
+    const sorobanContext = getSorobanContext();
+    if (sorobanContext && rpcServer && serverKeypair) {
+      const contractId = process.env.CONTRACT_ID;
+      if (contractId) {
+        const sourceAccount = await rpcServer.getAccount(serverKeypair.publicKey());
+        const contract = new Contract(contractId);
+        const tx = contract.call(
+          "resume_stream",
+          nativeToScVal(parseInt(id), { type: "u64" }),
+          new Address(stream.sender).toScVal(),
+        );
+
+        const built = await rpcServer.prepareTransaction(
+          new TransactionBuilder(sourceAccount, {
+            fee: "1000",
+            networkPassphrase: process.env.NETWORK_PASSPHRASE || Networks.TESTNET,
+          })
+            .addOperation(tx)
+            .setTimeout(30)
+            .build(),
+        );
+
+        built.sign(serverKeypair);
+        const sendRes = await retryWithBackoff(() => rpcServer!.sendTransaction(built));
+        if (sendRes.status === "PENDING") {
+          let txResult;
+          let attempts = 0;
+          while (attempts < 10) {
+            txResult = await retryWithBackoff(() =>
+              rpcServer!.getTransaction(sendRes.hash),
+            );
+            if (txResult.status !== "NOT_FOUND") break;
+            await new Promise((r) => setTimeout(r, 1000));
+            attempts++;
+          }
+        }
+      }
+    }
+  } catch (err) {
+    logger.warn({ err, streamId: id }, "failed to resume stream on chain");
+  }
+
   const db = getDb();
   db.transaction(() => {
     upsertStream(stream);