diff --git a/lib/game/ship.test.ts b/lib/game/ship.test.ts
new file mode 100644
index 0000000..b6dc322
--- /dev/null
+++ b/lib/game/ship.test.ts
@@ -0,0 +1,148 @@
+import { mkdtemp, rm } from 'node:fs/promises'
+import { tmpdir } from 'node:os'
+import path from 'node:path'
+import { afterAll, describe, expect, it } from 'vitest'
+import { eq } from 'drizzle-orm'
+import { openGameDb, type GameDb } from '@/lib/db/client'
+import * as schema from '@/lib/db/schema'
+import { BASE_CAPACITY, BASE_LEVEL, BUILD_PART_COST, MAX_CAPACITY, MAX_LEVEL, SHIP_TYPES } from './ship-costs'
+import { buildSystem, expandSystem, getShipState, upgradeSystem, type ShipState } from './ship'
+
+const dirs: string[] = []
+
+async function freshFile(): Promise<{ db: GameDb; file: string }> {
+  const dir = await mkdtemp(path.join(tmpdir(), 'sw-ship-test-'))
+  dirs.push(dir)
+  const file = path.join(dir, 'test.db')
+  return { db: await openGameDb(file), file }
+}
+
+afterAll(async () => {
+  for (const d of dirs) await rm(d, { recursive: true, force: true })
+})
+
+async function addItem(db: GameDb, kind: 'resource' | 'part', name: string, qty: number): Promise<void> {
+  const [save] = await db.db.select().from(schema.saves).limit(1)
+  await db.db.insert(schema.inventoryItems).values({ saveId: save.id, kind, name, qty })
+}
+
+const systemOf = (state: ShipState, type: string): ShipState['systems'][number] => state.systems.find((s) => s.type === type)!
+
+describe('getShipState', () => {
+  it('new game: starting ship in display order — core types built at base values, WEAPONS unbuilt', async () => {
+    const { db } = await freshFile()
+    const state = await getShipState(db)
+
+    expect(state.systems.map((s) => s.type)).toEqual(SHIP_TYPES.map((t) => t.type)) // display order follows SHIP_TYPES
+    for (const def of SHIP_TYPES) {
+      const row = systemOf(state, def.type)
+      if (def.builtAtStart) {
+        expect(row.built).toBe(true)
+        expect({ level: row.level, capacity: row.capacity }).toEqual({ level: BASE_LEVEL, capacity: BASE_CAPACITY })
+      } else {
+        expect(row.built).toBe(false) // unbuilt until a BUILD action
+        expect(row.level).toBe(0)
+        expect(row.capacity).toBe(0)
+      }
+    }
+    expect(state.inventory).toEqual([])
+    expect(state.turn).toBe(0)
+  })
+})
+
+describe('upgradeSystem', () => {
+  it('rejects with 422 and mutates nothing when the hold is empty', async () => {
+    const { db } = await freshFile()
+    const before = await getShipState(db)
+    const reactorId = systemOf(before, 'REACTOR').id
+
+    await expect(upgradeSystem(db, reactorId)).rejects.toMatchObject({ status: 422 })
+
+    const after = await getShipState(db)
+    expect(systemOf(after, 'REACTOR').level).toBe(BASE_LEVEL) // no level change…
+    expect(after.turn).toBe(before.turn) // …and no turn spent on a failed action
+  })
+
+  it('rejects unknown systemId with 404 and unbuilt systems with 409', async () => {
+    const { db } = await freshFile()
+    await getShipState(db)
+    await expect(upgradeSystem(db, 999)).rejects.toMatchObject({ status: 404 })
+    const weaponsId = systemOf(await getShipState(db), 'WEAPONS').id
+    await expect(upgradeSystem(db, weaponsId)).rejects.toMatchObject({ status: 409 })
+  })
+
+  it('consumes the cost from the oldest resource row first (deleting rows that hit zero), costs a turn and writes an event', async () => {
+    const { db } = await freshFile()
+    await getShipState(db)
+    await addItem(db, 'resource', 'IRON ORE', 1) // oldest — fully consumed by the cost of 1
+    await addItem(db, 'resource', 'CRYSTAL DUST', 5)
+
+    const reactorId = systemOf(await getShipState(db), 'REACTOR').id
+    const state = await upgradeSystem(db, reactorId) // level 1 → cost 1 resource
+
+    expect(systemOf(state, 'REACTOR').level).toBe(BASE_LEVEL + 1)
+    expect((await db.db.select().from(schema.inventoryItems)).map((i) => [i.name, i.qty])).toEqual([['CRYSTAL DUST', 5]]) // IRON ORE row deleted
+    expect(state.turn).toBe(1)
+
+    const event = (await db.db.select().from(schema.events)).find((e) => e.type === 'upgrade')!
+    expect(event.turn).toBe(1)
+    expect(event.message).toContain('REACTOR')
+  })
+
+  it('caps at MAX_LEVEL with 409', async () => {
+    const { db } = await freshFile()
+    await getShipState(db)
+    const reactorId = systemOf(await getShipState(db), 'REACTOR').id
+    await db.db.update(schema.shipSystems).set({ level: MAX_LEVEL }).where(eq(schema.shipSystems.id, reactorId)) // cost path covered above
+
+    await expect(upgradeSystem(db, reactorId)).rejects.toMatchObject({ status: 409 })
+    expect((await getShipState(db)).turn).toBe(0)
+  })
+})
+
+describe('expandSystem', () => {
+  it('raises capacity by one for `capacity` resources; caps at MAX_CAPACITY with 409', async () => {
+    const { db } = await freshFile()
+    await getShipState(db)
+    await addItem(db, 'resource', 'IRON ORE', BASE_CAPACITY + 1) // cost is the current capacity (2), one left over
+
+    const hullId = systemOf(await getShipState(db), 'HULL').id
+    const state = await expandSystem(db, hullId)
+    expect(systemOf(state, 'HULL').capacity).toBe(BASE_CAPACITY + 1)
+    expect((await db.db.select().from(schema.inventoryItems)).map((i) => [i.name, i.qty])).toEqual([['IRON ORE', 1]])
+
+    await db.db.update(schema.shipSystems).set({ capacity: MAX_CAPACITY }).where(eq(schema.shipSystems.id, hullId))
+    await expect(expandSystem(db, hullId)).rejects.toMatchObject({ status: 409 })
+  })
+
+  it('rejects unknown systemId with 404 and unbuilt systems with 409', async () => {
+    const { db } = await freshFile()
+    await getShipState(db)
+    await expect(expandSystem(db, 999)).rejects.toMatchObject({ status: 404 })
+    const weaponsId = systemOf(await getShipState(db), 'WEAPONS').id
+    await expect(expandSystem(db, weaponsId)).rejects.toMatchObject({ status: 409 })
+  })
+})
+
+describe('buildSystem', () => {
+  it('builds an unbuilt type at base values for a flat parts cost; a second build is 409 and unknown types are 404', async () => {
+    const { db } = await freshFile()
+    await getShipState(db)
+
+    await expect(buildSystem(db, 'WEAPONS')).rejects.toMatchObject({ status: 422 }) // no parts in the hold yet
+
+    await addItem(db, 'part', 'SERVO ACTUATOR', BUILD_PART_COST)
+    const state = await buildSystem(db, 'WEAPONS')
+    const weapons = systemOf(state, 'WEAPONS')
+    expect(weapons.built).toBe(true)
+    expect({ level: weapons.level, capacity: weapons.capacity }).toEqual({ level: BASE_LEVEL, capacity: BASE_CAPACITY })
+    expect(await db.db.select().from(schema.inventoryItems)).toHaveLength(0) // parts row deleted
+    expect(state.turn).toBe(1)
+
+    const event = (await db.db.select().from(schema.events)).find((e) => e.type === 'build')!
+    expect(event.message).toContain('WEAPONS')
+
+    await expect(buildSystem(db, 'WEAPONS')).rejects.toMatchObject({ status: 409 }) // already built
+    await expect(buildSystem(db, 'SHIELDS')).rejects.toMatchObject({ status: 404 }) // not a known type
+  })
+})
diff --git a/lib/game/ship.ts b/lib/game/ship.ts
new file mode 100644
index 0000000..e628991
--- /dev/null
+++ b/lib/game/ship.ts
@@ -0,0 +1,124 @@
+import { eq } from 'drizzle-orm'
+import * as schema from '@/lib/db/schema'
+import { persist, type GameDb } from '@/lib/db/client'
+import { BUILD_PART_COST, BASE_CAPACITY, BASE_LEVEL, MAX_CAPACITY, MAX_LEVEL, SHIP_TYPES, expandCost, upgradeCost } from './ship-costs'
+import { ensureSave, type InventoryItemDto } from './save'
+
+export interface ShipSystemDto {
+  id: number
+  type: string
+  level: number
+  capacity: number
+  built: boolean // derived — level > 0 (unbuilt rows sit at level/capacity 0)
+}
+
+// The ship's full state for the SHIP SYSTEMS tab and left column.
+export interface ShipState {
+  systems: ShipSystemDto[] // display order follows SHIP_TYPES
+  inventory: InventoryItemDto[]
+  turn: number
+}
+
+// Carries an HTTP status so route handlers can map failures to responses without re-parsing.
+export class ShipError extends Error {
+  constructor(
+    public readonly status: number,
+    message: string,
+  ) {
+    super(message)
+  }
+}
+
+async function readShipState(db: GameDb): Promise<ShipState> {
+  const [save] = await db.db.select().from(schema.saves).limit(1)
+  const rows = await db.db.select().from(schema.shipSystems)
+  const orderOf = (type: string) => {
+    const i = SHIP_TYPES.findIndex((t) => t.type === type)
+    return i === -1 ? 99 : i // unknown types (shouldn't exist) sort last
+  }
+  const systems = [...rows]
+    .sort((a, b) => orderOf(a.type) - orderOf(b.type))
+    .map((r) => ({ id: r.id, type: r.type, level: r.level, capacity: r.capacity, built: r.level > 0 }))
+  const inventory = (await db.db.select().from(schema.inventoryItems)).map((i) => ({ kind: i.kind as 'resource' | 'part', name: i.name, qty: i.qty }))
+  return { systems, inventory, turn: save.turn }
+}
+
+// The ship's systems + cargo hold + turn. Auto-initializes like the other reads.
+export async function getShipState(db: GameDb): Promise<ShipState> {
+  await ensureSave(db)
+  return readShipState(db)
+}
+
+// Consume `amount` units of one kind from the oldest cargo rows first (id order); rows that hit
+// zero are deleted. The total is checked up front, so an insufficient hold mutates nothing.
+async function spendItems(db: GameDb, saveId: number, kind: 'resource' | 'part', amount: number): Promise<void> {
+  const rows = (await db.db.select().from(schema.inventoryItems)).filter((i) => i.kind === kind).sort((a, b) => a.id - b.id)
+  if (rows.reduce((sum, r) => sum + r.qty, 0) < amount) {
+    throw new ShipError(422, `Insufficient ${kind === 'resource' ? 'resources' : 'parts'} in the cargo hold — need ${amount}`)
+  }
+  let remaining = amount
+  for (const row of rows) {
+    if (remaining <= 0) break
+    const take = Math.min(row.qty, remaining)
+    remaining -= take
+    if (take >= row.qty) await db.db.delete(schema.inventoryItems).where(eq(schema.inventoryItems.id, row.id))
+    else await db.db.update(schema.inventoryItems).set({ qty: row.qty - take }).where(eq(schema.inventoryItems.id, row.id))
+  }
+}
+
+async function bumpTurnAndEvent(db: GameDb, saveId: number, turn: number, type: string, message: string): Promise<void> {
+  await db.db.update(schema.saves).set({ turn }).where(eq(schema.saves.id, saveId))
+  await db.db.insert(schema.events).values({ saveId, turn, type, message, createdAt: new Date().toISOString() })
+}
+
+// UPGRADE — level up a built system by one (capped at MAX_LEVEL). Cost: `level` units of any resource.
+export async function upgradeSystem(db: GameDb, systemId: number): Promise<ShipState> {
+  await ensureSave(db)
+  const [save] = await db.db.select().from(schema.saves).limit(1)
+  const target = (await db.db.select().from(schema.shipSystems)).find((s) => s.id === systemId)
+  if (!target) throw new ShipError(404, `Unknown ship system ${systemId}`)
+  if (target.level <= 0) throw new ShipError(409, `${target.type} is not built`)
+  if (target.level >= MAX_LEVEL) throw new ShipError(409, `${target.type} is at max level (${MAX_LEVEL})`)
+
+  const cost = upgradeCost(target.level)
+  await spendItems(db, save.id, 'resource', cost)
+  const turn = save.turn + 1
+  await db.db.update(schema.shipSystems).set({ level: target.level + 1 }).where(eq(schema.shipSystems.id, target.id))
+  await bumpTurnAndEvent(db, save.id, turn, 'upgrade', `Upgraded ${target.type} to level ${target.level + 1} (cost: ${cost}× resources)`)
+  await persist(db)
+  return readShipState(db)
+}
+
+// EXPAND — raise a built system's capacity by one (capped at MAX_CAPACITY). Cost: `capacity` units of any resource.
+export async function expandSystem(db: GameDb, systemId: number): Promise<ShipState> {
+  await ensureSave(db)
+  const [save] = await db.db.select().from(schema.saves).limit(1)
+  const target = (await db.db.select().from(schema.shipSystems)).find((s) => s.id === systemId)
+  if (!target) throw new ShipError(404, `Unknown ship system ${systemId}`)
+  if (target.level <= 0) throw new ShipError(409, `${target.type} is not built`)
+  if (target.capacity >= MAX_CAPACITY) throw new ShipError(409, `${target.type} is at max capacity (${MAX_CAPACITY})`)
+
+  const cost = expandCost(target.capacity)
+  await spendItems(db, save.id, 'resource', cost)
+  const turn = save.turn + 1
+  await db.db.update(schema.shipSystems).set({ capacity: target.capacity + 1 }).where(eq(schema.shipSystems.id, target.id))
+  await bumpTurnAndEvent(db, save.id, turn, 'expand', `Expanded ${target.type} capacity to ${target.capacity + 1} (cost: ${cost}× resources)`)
+  await persist(db)
+  return readShipState(db)
+}
+
+// BUILD — build an unbuilt type at base values. Cost: a flat amount of parts.
+export async function buildSystem(db: GameDb, type: string): Promise<ShipState> {
+  await ensureSave(db)
+  const [save] = await db.db.select().from(schema.saves).limit(1)
+  const target = (await db.db.select().from(schema.shipSystems)).find((s) => s.type === type)
+  if (!target) throw new ShipError(404, `Unknown ship system type ${type}`)
+  if (target.level > 0) throw new ShipError(409, `${target.type} is already built`)
+
+  await spendItems(db, save.id, 'part', BUILD_PART_COST)
+  const turn = save.turn + 1
+  await db.db.update(schema.shipSystems).set({ level: BASE_LEVEL, capacity: BASE_CAPACITY }).where(eq(schema.shipSystems.id, target.id))
+  await bumpTurnAndEvent(db, save.id, turn, 'build', `Built ${target.type} at base values (cost: ${BUILD_PART_COST}× parts)`)
+  await persist(db)
+  return readShipState(db)
+}