diff --git a/src/core/math-delims.ts b/src/core/math-delims.ts
index cb700c3..3367969 100644
--- a/src/core/math-delims.ts
+++ b/src/core/math-delims.ts
@@ -129,6 +129,48 @@ function closeEndsLine(text: string, afterClose: number): boolean {
  * Rewrite balanced `\(...\)` → `$$...$$` and `\[...\]` → `$$\n...\n$$`.
  * Everything else passes through byte-for-byte.
  */
+/** The escaped-dollar-aware inline closer (owner, 2026-10-12): micromark's
+ *  mathText closer is code-span logic — ANY size-matched `$` run closes,
+ *  `\$` included, so `$x = \$5$` closes at the `\$` and errors. KaTeX's
+ *  own auto-render scanner skips escaped dollars, and KaTeX renders `\$`
+ *  fine — the author's intent is unambiguous: an escaped dollar (odd number
+ *  of backslashes before it) never closes the span. Mirrors findDollarClose's
+ *  inline rules otherwise (exact size match, whole-run skip). */
+function findInlineDollarCloseEscapeAware(text: string, from: number): number {
+	for (let j = from; j < text.length;) {
+		if (text[j] !== "$") {
+			j += 1;
+			continue;
+		}
+		if (isEscaped(text, j)) {
+			j += 1;
+			continue; // `\$` never closes
+		}
+		const count = dollarRun(text, j);
+		if (count === 1) return j;
+		j += count;
+	}
+	return -1;
+}
+
+/** Replace `\$` (odd-backslash dollars) inside a math span with the
+ *  dollar-free `\text{\textdollar}` — KaTeX-safe in math mode (bare
+ *  `\textdollar` is text-mode-only there). Even-backslash dollars (`\\$`,
+ *  row break + dollar) are left alone. */
+function replaceEscapedDollars(content: string): string {
+	let replaced = "";
+	for (let j = 0; j < content.length;) {
+		if (content[j] === "\\" && content[j + 1] === "$" && !isEscaped(content, j)) {
+			replaced += "\\text{\\textdollar}";
+			j += 2;
+		} else {
+			replaced += content[j];
+			j += 1;
+		}
+	}
+	return replaced;
+}
+
 export function transformMathDelimiters(markdown: string): string {
 	const out: string[] = [];
 	let i = 0;
@@ -206,6 +248,35 @@ export function transformMathDelimiters(markdown: string): string {
 			}
 		}
 
+		// Escaped dollars inside inline math (owner, 2026-10-12): normalize
+		// BEFORE tokenization — inside a balanced inline span, `\$` becomes the
+		// dollar-free `\text{\textdollar}` so the scanner's closer is the one
+		// the author meant (micromark would otherwise close at the `\$`, error
+		// out, and cascade). Display runs are copied whole and left untouched —
+		// a lone `$` can't close `$$`, so `\$` already survives there — and
+		// copying the run stops its second `$` posing as an inline opener.
+		// Spans without escaped dollars emit byte-identical text; prose `\$`,
+		// code, and unbalanced spans are untouched.
+		if (ch === "$" && !isEscaped(markdown, i)) {
+			const run = dollarRun(markdown, i);
+			if (run === 1) {
+				const closeAt = findInlineDollarCloseEscapeAware(markdown, i + 1);
+				if (closeAt !== -1) {
+					const content = markdown.slice(i + 1, closeAt);
+					const replaced = replaceEscapedDollars(content);
+					if (replaced !== content) {
+						out.push(`$${replaced}$`);
+						i = closeAt + 1;
+						continue;
+					}
+				}
+			} else {
+				out.push(markdown.slice(i, i + run));
+				i += run;
+				continue;
+			}
+			}
+
 		out.push(ch);
 		i += 1;
 	}
diff --git a/tests/render-markdown.test.tsx b/tests/render-markdown.test.tsx
index fdbd1d9..4263d98 100644
--- a/tests/render-markdown.test.tsx
+++ b/tests/render-markdown.test.tsx
@@ -253,3 +253,95 @@ describe("render — bold is the real <strong> (the dead Bold-color fix)", () =>
 		assert.ok(html.includes("<em>"), "italic renders a native em element");
 	});
 });
+
+// ─── escaped dollars inside math (owner, 2026-10-12) ────────────────────────
+//
+// micromark's mathText closer is code-span logic — ANY size-matched `$` run
+// closes, `\$` included — so `$x = \$5$` closed at the escape and errored.
+// KaTeX itself renders `\$` fine (and its own auto-render scanner skips
+// escaped dollars). The fix normalizes at the render seam: inside balanced
+// inline spans, `\$` becomes the dollar-free `\text{\textdollar}` BEFORE
+// tokenization, so the scanner's closer is the one the author meant.
+
+describe("escaped dollars inside math — transform units", () => {
+	it("replaces \\$ inside a balanced inline span", () => {
+		assert.equal(
+			transformMathDelimiters("It costs $x = \\$5$ at market."),
+			"It costs $x = \\text{\\textdollar}5$ at market.",
+		);
+	});
+
+	it("replaces every escaped dollar in the span, including the \\text{\\$} form", () => {
+		assert.equal(
+			transformMathDelimiters("$\\$3 + \\text{\\$}4 = \\$7$ exactly."),
+			"$\\text{\\textdollar}3 + \\text{\\text{\\textdollar}}4 = \\text{\\textdollar}7$ exactly.",
+		);
+	});
+
+	it("does NOT replace even-backslash dollars (row break + dollar keeps closing)", () => {
+		// `$a\\$` closes at that `$` in micromark today — the parity is load-
+		// bearing; replacing it would change span ends for legitimate TeX.
+		const md = "$a\\\\$b$ tail";
+		assert.equal(transformMathDelimiters(md), md);
+	});
+
+	it("leaves prose escaped dollars and bare currency untouched", () => {
+		const md = "It costs \\$5 flat, then $5 and $10 more.";
+		assert.equal(transformMathDelimiters(md), md);
+	});
+
+	it("leaves display spans untouched — a lone $ can't close $$, \\$ already survives", () => {
+		const md = "$$x = \\$5,\\ q = \\$12$$";
+		assert.equal(transformMathDelimiters(md), md);
+	});
+
+	it("leaves code spans, fences, and unbalanced spans untouched", () => {
+		assert.equal(transformMathDelimiters("Type `$x = \\$5$` literally."), "Type `$x = \\$5$` literally.");
+		assert.equal(transformMathDelimiters("```\n$x = \\$5$\n```"), "```\n$x = \\$5$\n```");
+		assert.equal(transformMathDelimiters("Broken: $x = \\$5"), "Broken: $x = \\$5");
+	});
+
+	it("clean spans stay byte-identical; only the escape-bearing span changes", () => {
+		const md = "$a$ costs $5\\$10$ and $b$";
+		assert.equal(
+			transformMathDelimiters(md),
+			"$a$ costs $5\\text{\\textdollar}10$ and $b$",
+		);
+	});
+});
+
+describe("escaped dollars inside math — rendering", () => {
+	it("renders $x = \\$5$ as one clean math span with a visible dollar", () => {
+		const html = render("It costs $x = \\$5$ at market.");
+		assert.equal((html.match(/class="katex"/g) ?? []).length, 1, "one math span");
+		assert.ok(!html.includes("katex-error"), "no KaTeX errors");
+		assert.ok(html.includes("\\text{\\textdollar}"), "the dollar-free command reaches KaTeX");
+	});
+
+	it("the session cascade case renders every later span cleanly", () => {
+		// The latex-testing session's Test 6: the early close used to error
+		// and could swallow the following text.
+		const html = render("Line A: $x = \\$5$.\n\nLine B: $y = 2$.\n\nWhat is $2 + 2$?");
+		assert.equal((html.match(/class="katex"/g) ?? []).length, 3, "all three spans render");
+		assert.ok(!html.includes("katex-error"), "no KaTeX errors");
+		assert.ok(html.includes("Line B:"), "prose between spans survives");
+	});
+
+	it("renders the \\text{\\$} form (Test 5's text-mode dollar)", () => {
+		const html = render("Price: $\\text{\\$}12$ today.");
+		assert.equal((html.match(/class="katex"/g) ?? []).length, 1);
+		assert.ok(!html.includes("katex-error"));
+	});
+
+	it("legacy \\(...\\$...\\) converts and renders with the dollar intact", () => {
+		const html = render("Old form \\(x = \\$5\\) renders.");
+		assert.equal((html.match(/class="katex"/g) ?? []).length, 1);
+		assert.ok(!html.includes("katex-error"));
+	});
+
+	it("code spans keep the escaped dollar literal", () => {
+		const html = render("Type `$x = \\$5$` literally.");
+		assert.equal((html.match(/class="katex"/g) ?? []).length, 0, "code is not math");
+		assert.ok(html.includes("$x = \\$5$"), "the literal source stays visible");
+	});
+});