diff --git a/internal/dev/server.go b/internal/dev/server.go
index e10a5c8e..e4318944 100644
--- a/internal/dev/server.go
+++ b/internal/dev/server.go
@@ -29,6 +29,12 @@ import (
 	"golang.org/x/net/http2"
 )
 
+const (
+	maxConnectionFailures = 20
+	maxReconnectBaseDelay = time.Millisecond * 250
+	maxReconnectMaxDelay  = time.Second * 10
+)
+
 var propagator propagation.TraceContext
 
 type Server struct {
@@ -55,10 +61,16 @@ type Server struct {
 	expiresAt      *time.Time
 	tlsCertificate *tls.Certificate
 	conn           *tls.Conn
-	srv            *http2.Server
 	wg             sync.WaitGroup
 	serverAddr     string
 	cleanup        func()
+
+	// Connection state
+	connectionLock    sync.Mutex
+	reconnectFailures int
+	connectionFailed  time.Time
+	connectionStarted time.Time
+	reconnectMutex    sync.Mutex
 }
 
 type ServerArgs struct {
@@ -147,10 +159,45 @@ func (s *Server) reconnect() {
 
 func (s *Server) connect(initial bool) {
 	var gerr error
+
+	// hold a connection lock to prevent multiple go routines from trying to reconnect
+	// before the previous connect goroutine has finished
+	s.connectionLock.Lock()
+	defer s.connectionLock.Unlock()
+
 	defer func() {
 		if initial && gerr != nil {
 			s.connected <- gerr.Error()
 		}
+		s.logger.Debug("connection closed")
+		select {
+		case <-s.ctx.Done():
+			return
+		default:
+			var count int
+			var started time.Time
+			s.reconnectMutex.Lock()
+			if s.reconnectFailures == 0 {
+				s.connectionFailed = time.Now()
+				s.logger.Warn("lost connection to the dev server, reconnecting ...")
+			}
+			s.reconnectFailures++
+			started = s.connectionFailed
+			count = s.reconnectFailures
+			s.reconnectMutex.Unlock()
+			if count >= maxConnectionFailures {
+				s.logger.Fatal("Too many connection failures, giving up after %d attempts (%s). You may need to re-run `agentuity dev`. If this error persists, please contact support.", count, time.Since(started))
+				return
+			}
+			baseDelay := maxReconnectBaseDelay
+			wait := baseDelay * time.Duration(math.Pow(2, float64(count-1)))
+			if wait > maxReconnectMaxDelay {
+				wait = maxReconnectMaxDelay
+			}
+			s.logger.Debug("reconnecting in %s after %d connection failures (%s)", wait, count, time.Since(started))
+			time.Sleep(wait)
+			s.reconnect()
+		}
 	}()
 
 	if err := s.refreshConnection(); err != nil {
@@ -174,7 +221,7 @@ func (s *Server) connect(initial bool) {
 	conn, err := tls.Dial("tcp", s.serverAddr, &tlsConfig)
 	if err != nil {
 		gerr = err
-		s.logger.Error("failed to dial tls: %s", err)
+		s.logger.Warn("failed to dial tls: %s, will retry ...", err)
 		return
 	}
 	s.conn = conn
@@ -183,6 +230,19 @@ func (s *Server) connect(initial bool) {
 		s.connected <- ""
 	}
 
+	// if we successfully connect, reset our connection failures
+	s.reconnectMutex.Lock()
+	if s.reconnectFailures > 0 && !s.connectionFailed.IsZero() {
+		s.logger.Debug("reconnection successful after %s (%d attempts)", time.Since(s.connectionFailed), s.reconnectFailures)
+		s.logger.Info("✅ connection to the dev server re-established")
+	}
+	s.reconnectFailures = 0
+	s.connectionStarted = time.Now()
+	s.connectionFailed = time.Time{}
+	s.reconnectMutex.Unlock()
+
+	s.logger.Debug("connection established to %s", s.serverAddr)
+
 	// HTTP/2 server to accept proxied requests over the tunnel connection
 	h2s := &http2.Server{}