diff --git a/aios_core/kernel/__init__.py b/aios_core/kernel/__init__.py
new file mode 100644
index 000000000..8e14daf36
--- /dev/null
+++ b/aios_core/kernel/__init__.py
@@ -0,0 +1,6 @@
+"""AIOS v20 Kernel foundation."""
+
+from .identity import AgentIdentity
+from .audit import AuditLogger
+
+__all__ = ["AgentIdentity", "AuditLogger"]
diff --git a/aios_core/kernel/audit.py b/aios_core/kernel/audit.py
new file mode 100644
index 000000000..a8c2896f0
--- /dev/null
+++ b/aios_core/kernel/audit.py
@@ -0,0 +1,15 @@
+from datetime import datetime
+
+
+class AuditLogger:
+    """Minimal audit event storage for AIOS v20 kernel."""
+
+    def __init__(self):
+        self.events = []
+
+    def record(self, event: dict):
+        event["timestamp"] = datetime.utcnow().isoformat()
+        self.events.append(event)
+
+    def get_events(self):
+        return self.events
diff --git a/aios_core/kernel/context.py b/aios_core/kernel/context.py
new file mode 100644
index 000000000..a885a4edf
--- /dev/null
+++ b/aios_core/kernel/context.py
@@ -0,0 +1,9 @@
+from dataclasses import dataclass
+from typing import Any
+
+
+@dataclass
+class ExecutionContext:
+    agent_id: str
+    action: str
+    metadata: dict[str, Any] | None = None
diff --git a/aios_core/kernel/decisions.py b/aios_core/kernel/decisions.py
new file mode 100644
index 000000000..52561f70a
--- /dev/null
+++ b/aios_core/kernel/decisions.py
@@ -0,0 +1,7 @@
+from dataclasses import dataclass
+
+
+@dataclass
+class PolicyDecision:
+    allowed: bool
+    reason: str
diff --git a/aios_core/kernel/exceptions.py b/aios_core/kernel/exceptions.py
new file mode 100644
index 000000000..dbca5faf1
--- /dev/null
+++ b/aios_core/kernel/exceptions.py
@@ -0,0 +1,6 @@
+class KernelError(Exception):
+    pass
+
+
+class PermissionDenied(KernelError):
+    pass
diff --git a/aios_core/kernel/identity.py b/aios_core/kernel/identity.py
new file mode 100644
index 000000000..f6841f283
--- /dev/null
+++ b/aios_core/kernel/identity.py
@@ -0,0 +1,10 @@
+class AgentIdentity:
+    """Identity model for AIOS agents."""
+
+    def __init__(self, agent_id: str, role: str, capabilities=None):
+        self.agent_id = agent_id
+        self.role = role
+        self.capabilities = capabilities or []
+
+    def has_capability(self, capability: str) -> bool:
+        return capability in self.capabilities
diff --git a/aios_core/kernel/kernel.py b/aios_core/kernel/kernel.py
new file mode 100644
index 000000000..f69e39e06
--- /dev/null
+++ b/aios_core/kernel/kernel.py
@@ -0,0 +1,16 @@
+from .decisions import PolicyDecision
+
+
+class Kernel:
+    def __init__(self, identity, trust, policy, audit):
+        self.identity = identity
+        self.trust = trust
+        self.policy = policy
+        self.audit = audit
+
+    def process(self, context):
+        self.identity.validate(context.agent_id)
+        trust = self.trust.evaluate(context.agent_id)
+        decision = self.policy.evaluate(context, trust)
+        self.audit.record(decision)
+        return decision
diff --git a/aios_core/kernel/policies.py b/aios_core/kernel/policies.py
new file mode 100644
index 000000000..4ea548396
--- /dev/null
+++ b/aios_core/kernel/policies.py
@@ -0,0 +1,24 @@
+"""AIOS v20 policy engine foundation."""
+
+from dataclasses import dataclass
+
+
+@dataclass
+class PolicyDecision:
+    allowed: bool
+    reason: str
+
+
+class PolicyEngine:
+    def __init__(self):
+        self.rules = {}
+
+    def allow(self, capability: str) -> None:
+        self.rules[capability] = True
+
+    def evaluate(self, capability: str) -> PolicyDecision:
+        allowed = self.rules.get(capability, False)
+        return PolicyDecision(
+            allowed=allowed,
+            reason="allowed" if allowed else "missing_capability",
+        )
diff --git a/aios_core/kernel/trust.py b/aios_core/kernel/trust.py
new file mode 100644
index 000000000..d23f31e84
--- /dev/null
+++ b/aios_core/kernel/trust.py
@@ -0,0 +1,15 @@
+"""AIOS v20 trust management foundation."""
+
+
+class TrustManager:
+    def __init__(self):
+        self._trust = {}
+
+    def evaluate(self, agent_id: str) -> str:
+        return self._trust.get(agent_id, "T0")
+
+    def grant(self, agent_id: str, level: str = "T1") -> None:
+        self._trust[agent_id] = level
+
+    def revoke(self, agent_id: str) -> None:
+        self._trust[agent_id] = "T0"
diff --git a/aios_core/runtime/__init__.py b/aios_core/runtime/__init__.py
new file mode 100644
index 000000000..0aa0f7801
--- /dev/null
+++ b/aios_core/runtime/__init__.py
@@ -0,0 +1,5 @@
+"""AIOS v20 runtime layer."""
+
+from .lifecycle import AgentState, LifecycleManager
+
+__all__ = ["AgentState", "LifecycleManager"]
diff --git a/aios_core/runtime/budgets.py b/aios_core/runtime/budgets.py
new file mode 100644
index 000000000..dc75ca769
--- /dev/null
+++ b/aios_core/runtime/budgets.py
@@ -0,0 +1,11 @@
+class AgentBudget:
+    def __init__(self, max_actions=100, max_runtime=3600):
+        self.max_actions = max_actions
+        self.max_runtime = max_runtime
+        self.actions_used = 0
+
+    def can_execute(self):
+        return self.actions_used < self.max_actions
+
+    def consume(self):
+        self.actions_used += 1
diff --git a/aios_core/runtime/heartbeat.py b/aios_core/runtime/heartbeat.py
new file mode 100644
index 000000000..2dd9fc189
--- /dev/null
+++ b/aios_core/runtime/heartbeat.py
@@ -0,0 +1,12 @@
+from datetime import datetime
+
+
+class HeartbeatManager:
+    def __init__(self):
+        self.timestamps = {}
+
+    def ping(self, agent_id):
+        self.timestamps[agent_id] = datetime.utcnow()
+
+    def alive(self, agent_id):
+        return agent_id in self.timestamps
diff --git a/aios_core/runtime/lifecycle.py b/aios_core/runtime/lifecycle.py
new file mode 100644
index 000000000..2c45eeb6c
--- /dev/null
+++ b/aios_core/runtime/lifecycle.py
@@ -0,0 +1,26 @@
+from enum import Enum
+
+
+class AgentState(Enum):
+    CREATED = "created"
+    READY = "ready"
+    RUNNING = "running"
+    STOPPED = "stopped"
+    FAILED = "failed"
+
+
+class LifecycleManager:
+    def __init__(self):
+        self.states = {}
+
+    def register(self, agent_id):
+        self.states[agent_id] = AgentState.CREATED
+
+    def start(self, agent_id):
+        self.states[agent_id] = AgentState.RUNNING
+
+    def stop(self, agent_id):
+        self.states[agent_id] = AgentState.STOPPED
+
+    def fail(self, agent_id):
+        self.states[agent_id] = AgentState.FAILED
diff --git a/tests/kernel/test_identity.py b/tests/kernel/test_identity.py
new file mode 100644
index 000000000..699b63a1c
--- /dev/null
+++ b/tests/kernel/test_identity.py
@@ -0,0 +1,6 @@
+from aios_core.kernel import AgentIdentity
+
+
+def test_agent_capability():
+    agent = AgentIdentity("agent-001", "developer", ["code"])
+    assert agent.has_capability("code")
diff --git a/tests/kernel/test_trust_policy.py b/tests/kernel/test_trust_policy.py
new file mode 100644
index 000000000..23517cb97
--- /dev/null
+++ b/tests/kernel/test_trust_policy.py
@@ -0,0 +1,13 @@
+from aios_core.kernel.trust import TrustManager
+from aios_core.kernel.policies import PolicyEngine
+
+
+def test_trust_default_is_unknown():
+    manager = TrustManager()
+    assert manager.evaluate("agent-001") == "T0"
+
+
+def test_policy_denies_unknown_capability():
+    policy = PolicyEngine()
+    result = policy.evaluate("execute_tool")
+    assert result.allowed is False