diff --git a/src/main.rs b/src/main.rs
index 876f03f..f63e027 100644
--- a/src/main.rs
+++ b/src/main.rs
@@ -1829,14 +1829,13 @@ async fn cmd_distill(
         );
 
         // Hidden state matching loss: MSE between teacher and student per-layer states
-        let (hidden_mse_loss, _student_states) = if chunk_idx < frozen_states_per_chunk.len() {
+        // Uses per_layer_hidden collected during forward_train (no extra forward pass)
+        let hidden_mse_loss = if chunk_idx < frozen_states_per_chunk.len() && !train_output.per_layer_hidden.is_empty() {
             let teacher_states = &frozen_states_per_chunk[chunk_idx];
-            let student_states = student.forward_with_hidden_states(batch_tokens);
-            let mse = if teacher_states.len() == student_states.len() && !teacher_states.is_empty() {
-                let _hd = config.hidden_dim;
+            let student_states = &train_output.per_layer_hidden;
+            if teacher_states.len() == student_states.len() && !teacher_states.is_empty() {
                 let mut total_mse = 0.0f32;
                 let mut num_layers_compared = 0usize;
-                // Compare at every 5th layer to save compute
                 for layer_idx in (0..teacher_states.len()).step_by(5) {
                     let t_state = &teacher_states[layer_idx];
                     let s_state = &student_states[layer_idx];
@@ -1851,10 +1850,9 @@ async fn cmd_distill(
                 if num_layers_compared > 0 { total_mse / num_layers_compared as f32 } else { 0.0 }
             } else {
                 0.0
-            };
-            (mse, Some(student_states))
+            }
         } else {
-            (0.0, None)
+            0.0
         };
 
         // MoE Load balance loss: num_experts × Σ(f_i × P_i)
diff --git a/src/training/backward.rs b/src/training/backward.rs
index 941480a..b91ebdf 100644
--- a/src/training/backward.rs
+++ b/src/training/backward.rs
@@ -16,6 +16,8 @@ pub struct TrainForwardOutput {
     pub activations: Vec<LayerActivations>,
     /// Post-final-norm hidden states [seq, hidden_dim] — input to lm_head
     pub final_hidden: Vec<f32>,
+    /// Per-layer post-residual hidden states (for hidden state MSE loss)
+    pub per_layer_hidden: Vec<Vec<f32>>,
 }
 
 impl CpuBlockAttnResModel {
@@ -62,6 +64,8 @@ impl CpuBlockAttnResModel {
         let mut activations = Vec::with_capacity(self.num_layers);
         let lora_m = self.lora_manager.as_ref();
 
+        let mut per_layer_hidden: Vec<Vec<f32>> = Vec::with_capacity(self.num_layers);
+
         for (layer_idx, layer) in self.layers.iter().enumerate() {
             let ple_slice = ple_precomputed.as_ref().map(|pre| {
                 let mut slice = vec![0.0f32; seq * ple_dim];
@@ -218,6 +222,9 @@ impl CpuBlockAttnResModel {
                 expert_activations: layer_expert_act.unwrap_or_default(),
             });
 
+            // Store per-layer hidden state for MSE loss
+            per_layer_hidden.push(hidden.clone());
+
             for t in 0..seq { for d in 0..hd { partial_sum[d] += hidden[t * hd + d]; } }
             if self.is_block_boundary(layer_idx) {
                 for d in 0..hd { partial_sum[d] /= ((seq) * (self.block_config.layers_per_block)) as f32; }
@@ -236,7 +243,7 @@ impl CpuBlockAttnResModel {
             for l in logits.iter_mut() { *l = (*l / cap).tanh() * cap; }
         }
 
-        TrainForwardOutput { logits, routing_data, activations, final_hidden }
+        TrainForwardOutput { logits, routing_data, activations, final_hidden, per_layer_hidden }
     }
 }