diff --git a/internal/tui/model.go b/internal/tui/model.go
index acfcfb2..9b9f9a2 100644
--- a/internal/tui/model.go
+++ b/internal/tui/model.go
@@ -111,3 +111,8 @@ func (m Model) SelectedEntry() *core.HostEntry {
 	}
 	return m.hosts.Entries[idx]
 }
+
+// Mode returns the current operating mode of the TUI.
+func (m Model) Mode() Mode {
+	return m.mode
+}
diff --git a/internal/tui/update.go b/internal/tui/update.go
index 15b220b..e29fd15 100644
--- a/internal/tui/update.go
+++ b/internal/tui/update.go
@@ -18,6 +18,20 @@ func (m Model) Update(msg tea.Msg) (tea.Model, tea.Cmd) {
 			} else {
 				m.focus = listPane
 			}
+		case "e":
+			if m.mode == ViewMode {
+				m.mode = EditMode
+			} else {
+				m.mode = ViewMode
+			}
+		case "a":
+			if m.mode == EditMode {
+				if entry := m.SelectedEntry(); entry != nil {
+					entry.Active = !entry.Active
+					m.list.SetItem(m.list.Index(), entryItem{entry})
+					m.refreshDetail()
+				}
+			}
 		case "up", "k":
 			if m.focus == detailPane {
 				m.detail.LineUp(1)
diff --git a/internal/tui/view.go b/internal/tui/view.go
index ecc371e..8190a0e 100644
--- a/internal/tui/view.go
+++ b/internal/tui/view.go
@@ -47,7 +47,11 @@ func (m Model) View() string {
 
 	// join panes and status bar
 	panes := lipgloss.JoinHorizontal(lipgloss.Top, left, right)
-	status := fmt.Sprintf("VIEW MODE • %d entries", len(m.hosts.Entries))
+	modeLabel := "VIEW"
+	if m.mode == EditMode {
+		modeLabel = "EDIT"
+	}
+	status := fmt.Sprintf("%s MODE • %d entries", modeLabel, len(m.hosts.Entries))
 	bar := statusStyle.Width(m.width).Render(status)
 	return lipgloss.JoinVertical(lipgloss.Left, panes, bar)
 }
diff --git a/memory-bank/activeContext.md b/memory-bank/activeContext.md
index 65148e1..c19e750 100644
--- a/memory-bank/activeContext.md
+++ b/memory-bank/activeContext.md
@@ -2,8 +2,8 @@
 
 ## Current Work Focus
 
-**Status**: Phase 2 Complete - Basic TUI prototype finished
-**Priority**: Begin Phase 3 - Edit mode and file integration
+**Status**: Phase 3 In Progress - Edit mode basics implemented
+**Priority**: Expand Phase 3 with file integration and advanced editing
 
 ## Recent Changes
 
@@ -23,6 +23,11 @@
 - ✅ **View mode** showing entry details and status bar
 - ✅ **Parser integration** loading `/etc/hosts` into the UI
 
+### Phase 3: Edit Mode (IN PROGRESS)
+- 🔄 **Edit mode toggle** via 'e' key with status bar indication
+- 🔄 **Entry activation toggle** using 'a' key
+- 🔄 **Model tests** covering edit mode behavior
+
 ### Parser Capabilities Achieved
 - ✅ **Standard entries**: IPv4, IPv6, multiple aliases, inline comments
 - ✅ **Disabled entries**: Commented lines with `# IP hostname` format detection
@@ -43,19 +48,19 @@
 
 ### Immediate (Phase 3 - Current Priority)
 1. **Edit Mode Implementation**
-   - Explicit mode transition with visual indicators
-   - Permission handling with sudo request
-   - Entry modification forms with validation
+   - ✅ Explicit mode transition with visual indicators
+   - 🔄 Permission handling with sudo request
+   - 🔄 Entry modification forms with validation
 
 2. **File Integration**
-   - Connect TUI with existing parser functionality for writes
-   - Real-time display of actual `/etc/hosts` content
-   - Live validation and formatting preview
+   - 🔄 Connect TUI with existing parser functionality for writes
+   - 🔄 Real-time display of actual `/etc/hosts` content
+   - 🔄 Live validation and formatting preview
 
 3. **Advanced Features**
-   - Entry toggle (activate/deactivate)
-   - Add/edit/delete operations
-   - Sorting and filtering capabilities
+   - ✅ Entry toggle (activate/deactivate)
+   - 🔄 Add/edit/delete operations
+   - 🔄 Sorting and filtering capabilities
 
 ## Active Decisions and Considerations
 
diff --git a/memory-bank/progress.md b/memory-bank/progress.md
index 620cd14..aedc400 100644
--- a/memory-bank/progress.md
+++ b/memory-bank/progress.md
@@ -53,9 +53,10 @@
 - [x] **Integration**: Connect TUI with existing parser functionality
 
 ### 🔧 Edit Functionality (Phase 3)
-- [ ] **Edit mode transition**: Explicit mode switching with visual indicators
+- [x] **Edit mode transition**: Explicit mode switching with visual indicators
 - [ ] **Permission handling**: Request sudo access when entering edit mode
-- [ ] **Entry modification**: Add, edit, delete, toggle active status
+- [x] **Entry modification**: Toggle active status
+- [ ] **Entry modification**: Add, edit, delete operations
 - [ ] **File writing**: Atomic updates with backup and rollback
 - [ ] **Input validation**: Real-time validation of IP and hostname inputs
 
@@ -67,7 +68,7 @@
 - [ ] **Search/filter**: Find entries quickly in large files
 
 ### 🧪 Testing & Quality (Ongoing)
-- [ ] **TUI tests**: User interactions, state transitions
+- [x] **TUI tests**: User interactions, state transitions
 - [ ] **Integration tests**: Complete TUI workflows with file operations
 - [ ] **Permission tests**: sudo scenarios, graceful degradation
 - [ ] **End-to-end tests**: Full application workflows
@@ -75,8 +76,8 @@
 ## Current Status
 
 ### Project Phase: **Phase 2 Complete → Phase 3 (Edit Mode Implementation)**
-- **Completion**: ~75% (parser and basic TUI implemented)
-- **Active work**: Begin edit mode and file integration (Phase 3)
+- **Completion**: ~80% (parser, TUI, and basic edit mode implemented)
+- **Active work**: Expand edit mode with file integration and advanced editing
 - **Blockers**: None - comprehensive parser foundation with 54 tests completed
 - **Parser status**: Production-ready with all safety features implemented
 
diff --git a/tests/tui_test.go b/tests/tui_test.go
index b9753ff..a73719a 100644
--- a/tests/tui_test.go
+++ b/tests/tui_test.go
@@ -62,3 +62,26 @@ func TestPaneSwitching(t *testing.T) {
 	m = nm.(tui.Model)
 	assert.Equal(t, "localhost", m.SelectedEntry().Hostname)
 }
+
+func TestEditModeToggleAndActivation(t *testing.T) {
+	sample := "127.0.0.1 localhost\n192.168.1.10 example.com"
+	lines := strings.Split(sample, "\n")
+	hf, _, err := core.ParseHostsContent(lines)
+	require.NoError(t, err)
+
+	m := tui.NewModel(hf)
+
+	// enter edit mode
+	nm, _ := m.Update(tea.KeyMsg{Type: tea.KeyRunes, Runes: []rune{'e'}})
+	m = nm.(tui.Model)
+	assert.Equal(t, tui.EditMode, m.Mode())
+
+	// toggle active state of first entry
+	nm, _ = m.Update(tea.KeyMsg{Type: tea.KeyRunes, Runes: []rune{'a'}})
+	m = nm.(tui.Model)
+	assert.False(t, m.SelectedEntry().Active)
+
+	// status bar should reflect edit mode
+	view := m.View()
+	assert.Contains(t, view, "EDIT MODE")
+}