diff --git a/src/entrypoints/prepare.ts b/src/entrypoints/prepare.ts
index 061df53..d7ad271 100644
--- a/src/entrypoints/prepare.ts
+++ b/src/entrypoints/prepare.ts
@@ -18,6 +18,7 @@ import { createPrompt } from "../create-prompt";
 import { createClient } from "../github/api/client";
 import { fetchGitHubData } from "../github/data/fetcher";
 import { parseGitHubContext } from "../github/context";
+import { setupOAuthCredentials } from "../claude/oauth-setup";
 
 async function run() {
   try {
@@ -27,18 +28,25 @@ async function run() {
 
     // Check if OAuth credentials are provided and API key is empty (OAuth mode)
     if (claudeCredentials && !anthropicApiKey) {
-      // Parse the credentials to extract the access token
+      // Write the credentials to the file system for Claude Code
       try {
-        const parsedCredentials = JSON.parse(claudeCredentials);
-        if (parsedCredentials.claudeAiOauth?.accessToken) {
-          // Output the access token for the base action to use
-          core.setOutput("claude_oauth_token", parsedCredentials.claudeAiOauth.accessToken);
-          console.log("OAuth access token extracted for Claude AI Max subscription");
-        } else {
-          throw new Error("Invalid credentials format: missing claudeAiOauth.accessToken");
+        await setupOAuthCredentials(claudeCredentials);
+        console.log("OAuth credentials written to ~/.claude/.credentials.json");
+        
+        // Also extract the token for any other uses
+        try {
+          const parsedCredentials = JSON.parse(claudeCredentials);
+          if (parsedCredentials.claudeAiOauth?.accessToken) {
+            // Output the access token for the base action to use
+            core.setOutput("claude_oauth_token", parsedCredentials.claudeAiOauth.accessToken);
+            console.log("OAuth access token extracted for Claude AI Max subscription");
+          }
+        } catch (parseError) {
+          // Log but don't fail - credentials are already written
+          console.log("Could not extract OAuth token for output:", parseError);
         }
       } catch (error) {
-        throw new Error(`Failed to parse OAuth credentials: ${error instanceof Error ? error.message : String(error)}`);
+        throw new Error(`Failed to setup OAuth credentials: ${error instanceof Error ? error.message : String(error)}`);
       }
     }