diff --git a/src/index.ts b/src/index.ts
index cb72d79..101f746 100644
--- a/src/index.ts
+++ b/src/index.ts
@@ -801,8 +801,32 @@ export function mergeAgentsFiles(agentsFiles: string[]): string {
   for (const [, section] of Object.entries(allSections)) {
     result.push(`${'#'.repeat(section.level)} ${section.title}`);
     result.push('');
-    for (const content of section.contents) {
+    for (let i = 0; i < section.contents.length; i++) {
+      const content = section.contents[i];
+      const nextContent = section.contents[i + 1];
+
       result.push(content);
+
+      if (nextContent) {
+        const lastNewLineIndex = content.lastIndexOf('\n');
+        const lastLine =
+          lastNewLineIndex === -1
+            ? content
+            : content.substring(lastNewLineIndex + 1);
+
+        const firstNewLineIndex = nextContent.indexOf('\n');
+        const nextFirstLine =
+          firstNewLineIndex === -1
+            ? nextContent
+            : nextContent.substring(0, firstNewLineIndex);
+
+        // If both blocks are part of an unordered list (starting with '- '),
+        // skip the newline to merge them.
+        if (lastLine.startsWith('- ') && nextFirstLine.startsWith('- ')) {
+          continue;
+        }
+      }
+
       result.push('');
     }
   }
diff --git a/test/agents.test.ts b/test/agents.test.ts
index f6ff2eb..b215d5d 100644
--- a/test/agents.test.ts
+++ b/test/agents.test.ts
@@ -2,7 +2,7 @@ import fs from 'node:fs';
 import path from 'node:path';
 import { fileURLToPath } from 'node:url';
 import { assert, beforeEach, expect, test } from '@rstest/core';
-import { create } from '../src';
+import { create, mergeAgentsFiles } from '../src';
 
 const __dirname = path.dirname(fileURLToPath(import.meta.url));
 const fixturesDir = path.join(__dirname, 'fixtures', 'agents-md');
@@ -233,3 +233,97 @@ test('should merge top-level sections from AGENTS.md files', async () => {
     "
   `);
 });
+
+test('mergeAgentsFiles should handle unordered lists without extra newline', () => {
+  const file1 = `
+## Tools
+
+- item 1
+- item 2
+`;
+  const file2 = `
+## Tools
+
+- item 3
+`;
+
+  const merged = mergeAgentsFiles([file1, file2]);
+
+  expect(merged).toMatchInlineSnapshot(`
+    "## Tools
+
+    - item 1
+    - item 2
+    - item 3"
+  `);
+});
+
+test('mergeAgentsFiles should still add newline for non-list content', () => {
+  const file1 = `
+## Tools
+
+Some intro text.
+`;
+  const file2 = `
+## Tools
+
+More text.
+`;
+
+  const merged = mergeAgentsFiles([file1, file2]);
+
+  expect(merged).toMatchInlineSnapshot(`
+    "## Tools
+
+    Some intro text.
+
+    More text."
+  `);
+});
+
+test('mergeAgentsFiles should not skip newline for horizontal rules (---)', () => {
+  const file1 = `
+## Tools
+
+---
+`;
+  const file2 = `
+## Tools
+
+- item 1
+`;
+
+  const merged = mergeAgentsFiles([file1, file2]);
+
+  expect(merged).toMatchInlineSnapshot(`
+    "## Tools
+
+    ---
+
+    - item 1"
+  `);
+});
+
+test('mergeAgentsFiles should add newline when paragraph is followed by list', () => {
+  const file1 = `
+## Tools
+
+Some intro text.
+`;
+  const file2 = `
+## Tools
+
+- item 1
+`;
+
+  const merged = mergeAgentsFiles([file1, file2]);
+
+  // Revised requirement: Paragraph followed by list SHOULD have a newline.
+  expect(merged).toMatchInlineSnapshot(`
+    "## Tools
+
+    Some intro text.
+
+    - item 1"
+  `);
+});