diff --git a/cmd/crates/soroban-test/tests/it/config.rs b/cmd/crates/soroban-test/tests/it/config.rs
index 1c2457cc8..2b4a1edc4 100644
--- a/cmd/crates/soroban-test/tests/it/config.rs
+++ b/cmd/crates/soroban-test/tests/it/config.rs
@@ -194,6 +194,34 @@ fn seed_phrase() {
         .stdout(predicates::str::contains("test_seed\n"));
 }
 
+#[test]
+fn secure_store_rejects_env_secret_key() {
+    let sandbox = TestEnv::default();
+
+    // --secure-store with STELLAR_SECRET_KEY set should be rejected rather than
+    // silently writing the raw secret to a plaintext identity file.
+    sandbox
+        .new_assert_cmd("keys")
+        .env(
+            "STELLAR_SECRET_KEY",
+            "SDIY6AQQ75WMD4W46EYB7O6UYMHOCGQHLAQGQTKHDX4J2DYQCHVCQYFD",
+        )
+        .arg("add")
+        .arg("alice")
+        .arg("--secure-store")
+        .assert()
+        .failure()
+        .stderr(predicate::str::contains(
+            "--secure-store only supports seed phrases",
+        ));
+
+    // The identity file must not exist — no plaintext fallback.
+    assert!(
+        !sandbox.config_dir().join("identity/alice.toml").exists(),
+        "identity file should not be created when --secure-store is rejected"
+    );
+}
+
 #[test]
 fn use_env() {
     let sandbox = TestEnv::default();
diff --git a/cmd/soroban-cli/src/commands/keys/add.rs b/cmd/soroban-cli/src/commands/keys/add.rs
index 999884eec..64aa4271b 100644
--- a/cmd/soroban-cli/src/commands/keys/add.rs
+++ b/cmd/soroban-cli/src/commands/keys/add.rs
@@ -33,6 +33,12 @@ pub enum Error {
 
     #[error("An identity with the name '{0}' already exists")]
     IdentityAlreadyExists(String),
+
+    #[error(
+        "--secure-store only supports seed phrases; \
+         unset STELLAR_SECRET_KEY or provide a seed phrase instead"
+    )]
+    SecureStoreRequiresSeedPhrase,
 }
 
 #[derive(Debug, clap::Parser, Clone)]
@@ -82,9 +88,15 @@ impl Cmd {
     }
 
     fn read_secret(&self, print: &Print) -> Result<Secret, Error> {
-        if let Ok(secret_key) = std::env::var("STELLAR_SECRET_KEY") {
-            Ok(Secret::SecretKey { secret_key })
-        } else if self.secrets.secure_store {
+        if self.secrets.secure_store {
+            if std::env::var("STELLAR_SECRET_KEY").is_ok() {
+                return Err(Error::SecureStoreRequiresSeedPhrase);
+            }
+        } else if let Ok(secret_key) = std::env::var("STELLAR_SECRET_KEY") {
+            return Ok(Secret::SecretKey { secret_key });
+        }
+
+        if self.secrets.secure_store {
             let prompt = "Type a 12/24 word seed phrase:";
             let secret_key = read_password(print, prompt)?;
             if secret_key.split_whitespace().count() < 24 {