diff --git a/app/api/applications/[id]/review/route.ts b/app/api/applications/[id]/review/route.ts
index 6c518a7..25e12a5 100644
--- a/app/api/applications/[id]/review/route.ts
+++ b/app/api/applications/[id]/review/route.ts
@@ -28,7 +28,7 @@ export async function POST(
 
         return NextResponse.json({ success: true, data: updatedApp });
 
-    } catch (error) {
+    } catch {
         return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
     }
 }
diff --git a/app/api/bounties/[id]/apply/route.ts b/app/api/bounties/[id]/apply/route.ts
index 446b2c3..788fe8a 100644
--- a/app/api/bounties/[id]/apply/route.ts
+++ b/app/api/bounties/[id]/apply/route.ts
@@ -43,7 +43,7 @@ export async function POST(
         BountyStore.addApplication(application);
 
         return NextResponse.json({ success: true, data: application });
-    } catch (error) {
+    } catch {
         return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
     }
 }
diff --git a/app/api/bounties/[id]/claim/route.ts b/app/api/bounties/[id]/claim/route.ts
new file mode 100644
index 0000000..9f2608b
--- /dev/null
+++ b/app/api/bounties/[id]/claim/route.ts
@@ -0,0 +1,60 @@
+import { NextResponse } from 'next/server';
+import { BountyStore } from '@/lib/store';
+import { addDays } from 'date-fns';
+import { getCurrentUser } from '@/lib/server-auth';
+
+export async function POST(
+    request: Request,
+    { params }: { params: Promise<{ id: string }> }
+) {
+    const { id: bountyId } = await params;
+
+    try {
+        const user = await getCurrentUser();
+        if (!user) {
+            return NextResponse.json({ error: 'Unauthorized' }, { status: 401 });
+        }
+
+        const body = await request.json();
+        const { contributorId } = body;
+
+        // If client sends contributorId, ensure it matches the authenticated user
+        if (contributorId && contributorId !== user.id) {
+            return NextResponse.json({ error: 'Contributor ID mismatch' }, { status: 403 });
+        }
+
+        const bounty = BountyStore.getBountyById(bountyId);
+        if (!bounty) {
+            return NextResponse.json({ error: 'Bounty not found' }, { status: 404 });
+        }
+
+        if (bounty.claimingModel !== 'single-claim') {
+            return NextResponse.json({ error: 'Invalid claiming model for this action' }, { status: 400 });
+        }
+
+        if (bounty.status !== 'open') {
+            return NextResponse.json({ error: 'Bounty is not available' }, { status: 409 });
+        }
+
+        const now = new Date();
+        const updates = {
+            status: 'claimed' as const,
+            claimedBy: user.id, // Use authenticated user ID
+            claimedAt: now.toISOString(),
+            claimExpiresAt: addDays(now, 7).toISOString(),
+            updatedAt: now.toISOString()
+        };
+
+        const updatedBounty = BountyStore.updateBounty(bountyId, updates);
+
+        if (!updatedBounty) {
+            return NextResponse.json({ success: false, error: 'Failed to update bounty' }, { status: 500 });
+        }
+
+        return NextResponse.json({ success: true, data: updatedBounty });
+
+    } catch (error) {
+        console.error('Error claiming bounty:', error);
+        return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
+    }
+}
diff --git a/app/api/bounties/[id]/competition/join/route.ts b/app/api/bounties/[id]/competition/join/route.ts
new file mode 100644
index 0000000..e0c7a48
--- /dev/null
+++ b/app/api/bounties/[id]/competition/join/route.ts
@@ -0,0 +1,57 @@
+import { NextResponse } from 'next/server';
+import { BountyStore } from '@/lib/store';
+import { CompetitionParticipation } from '@/types/participation';
+import { getCurrentUser } from '@/lib/server-auth';
+
+const generateId = () => crypto.randomUUID();
+
+export async function POST(
+    request: Request,
+    { params }: { params: Promise<{ id: string }> }
+) {
+    const { id: bountyId } = await params;
+
+    try {
+        const user = await getCurrentUser();
+        if (!user) {
+            return NextResponse.json({ error: 'Unauthorized' }, { status: 401 });
+        }
+
+        const bounty = BountyStore.getBountyById(bountyId);
+        if (!bounty) {
+            return NextResponse.json({ error: 'Bounty not found' }, { status: 404 });
+        }
+
+        if (bounty.claimingModel !== 'competition') {
+            return NextResponse.json({ error: 'Invalid claiming model for this action' }, { status: 400 });
+        }
+
+        // Validate status is open
+        if (bounty.status !== 'open') {
+            return NextResponse.json({ error: 'Bounty is not open for registration' }, { status: 409 });
+        }
+
+        const existing = BountyStore.getCompetitionParticipationsByBounty(bountyId)
+            .find(p => p.contributorId === user.id);
+
+        if (existing) {
+            return NextResponse.json({ error: 'Already joined this competition' }, { status: 409 });
+        }
+
+        const participation: CompetitionParticipation = {
+            id: generateId(),
+            bountyId,
+            contributorId: user.id, // Use authenticated user ID
+            status: 'registered',
+            registeredAt: new Date().toISOString()
+        };
+
+        BountyStore.addCompetitionParticipation(participation);
+
+        return NextResponse.json({ success: true, data: participation });
+
+    } catch (error) {
+        console.error('Error joining competition:', error);
+        return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
+    }
+}
diff --git a/app/api/bounties/[id]/join/route.ts b/app/api/bounties/[id]/join/route.ts
index 4536204..794528b 100644
--- a/app/api/bounties/[id]/join/route.ts
+++ b/app/api/bounties/[id]/join/route.ts
@@ -49,7 +49,7 @@ export async function POST(
 
         return NextResponse.json({ success: true, data: participation });
 
-    } catch (error) {
+    } catch {
         return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
     }
 }
diff --git a/app/api/bounties/[id]/milestones/advance/route.ts b/app/api/bounties/[id]/milestones/advance/route.ts
index d37a0fb..779fae9 100644
--- a/app/api/bounties/[id]/milestones/advance/route.ts
+++ b/app/api/bounties/[id]/milestones/advance/route.ts
@@ -64,7 +64,7 @@ export async function POST(
 
         return NextResponse.json({ success: true, data: updated });
 
-    } catch (error) {
+    } catch {
         return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
     }
 }
diff --git a/app/api/bounties/[id]/submit/route.ts b/app/api/bounties/[id]/submit/route.ts
index ed09d0f..2ef4cf7 100644
--- a/app/api/bounties/[id]/submit/route.ts
+++ b/app/api/bounties/[id]/submit/route.ts
@@ -49,7 +49,7 @@ export async function POST(
 
         return NextResponse.json({ success: true, data: submission });
 
-    } catch (error) {
+    } catch {
         return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
     }
 }
diff --git a/app/api/submissions/[id]/select/route.ts b/app/api/submissions/[id]/select/route.ts
index 7a6ff64..a743c81 100644
--- a/app/api/submissions/[id]/select/route.ts
+++ b/app/api/submissions/[id]/select/route.ts
@@ -29,7 +29,7 @@ export async function POST(
 
         return NextResponse.json({ success: true, data: updatedSub });
 
-    } catch (error) {
+    } catch {
         return NextResponse.json({ error: 'Internal Server Error' }, { status: 500 });
     }
 }
diff --git a/components/bounty/application-dialog.tsx b/components/bounty/application-dialog.tsx
new file mode 100644
index 0000000..3b8102c
--- /dev/null
+++ b/components/bounty/application-dialog.tsx
@@ -0,0 +1,82 @@
+"use client"
+
+import { useState } from "react"
+import { Dialog, DialogContent, DialogDescription, DialogFooter, DialogHeader, DialogTitle, DialogTrigger } from "@/components/ui/dialog"
+import { Button } from "@/components/ui/button"
+import { Label } from "@/components/ui/label"
+import { Textarea } from "@/components/ui/textarea"
+import { Input } from "@/components/ui/input"
+
+interface ApplicationDialogProps {
+    bountyTitle: string
+    onApply: (data: { coverLetter: string, portfolioUrl?: string }) => Promise<boolean>
+    trigger: React.ReactNode
+}
+
+export function ApplicationDialog({ bountyTitle, onApply, trigger }: ApplicationDialogProps) {
+    const [open, setOpen] = useState(false)
+    const [loading, setLoading] = useState(false)
+    const [coverLetter, setCoverLetter] = useState("")
+    const [portfolioUrl, setPortfolioUrl] = useState("")
+
+    const handleSubmit = async (e: React.FormEvent) => {
+        e.preventDefault()
+        setLoading(true)
+        try {
+            const success = await onApply({ coverLetter, portfolioUrl })
+            if (success) {
+                setOpen(false)
+            }
+        } catch (error) {
+            console.error("Failed to submit application", error)
+        } finally {
+            setLoading(false)
+        }
+    }
+
+    return (
+        <Dialog open={open} onOpenChange={setOpen}>
+            <DialogTrigger asChild>
+                {trigger}
+            </DialogTrigger>
+            <DialogContent className="sm:max-w-[525px] bg-background text-foreground border-border">
+                <DialogHeader>
+                    <DialogTitle>Apply for Bounty</DialogTitle>
+                    <DialogDescription>
+                        Submit your application for &quot;{bountyTitle}&quot;.
+                    </DialogDescription>
+                </DialogHeader>
+                <form onSubmit={handleSubmit}>
+                    <div className="grid gap-4 py-4">
+                        <div className="grid gap-2">
+                            <Label htmlFor="coverLetter">Cover Letter</Label>
+                            <Textarea
+                                id="coverLetter"
+                                placeholder="Explain why you are a good fit..."
+                                className="min-h-[150px]"
+                                value={coverLetter}
+                                onChange={(e) => setCoverLetter(e.target.value)}
+                                required
+                            />
+                        </div>
+                        <div className="grid gap-2">
+                            <Label htmlFor="portfolio">Portfolio URL (Optional)</Label>
+                            <Input
+                                id="portfolio"
+                                placeholder="https://..."
+                                value={portfolioUrl}
+                                onChange={(e) => setPortfolioUrl(e.target.value)}
+                            />
+                        </div>
+                    </div>
+                    <DialogFooter>
+                        <Button type="button" variant="ghost" onClick={() => setOpen(false)}>Cancel</Button>
+                        <Button type="submit" disabled={loading}>
+                            {loading ? "Submitting..." : "Submit Application"}
+                        </Button>
+                    </DialogFooter>
+                </form>
+            </DialogContent>
+        </Dialog>
+    )
+}
diff --git a/components/bounty/bounty-sidebar.tsx b/components/bounty/bounty-sidebar.tsx
index cfe707b..0b2943a 100644
--- a/components/bounty/bounty-sidebar.tsx
+++ b/components/bounty/bounty-sidebar.tsx
@@ -4,9 +4,12 @@ import { useMemo, useState } from "react"
 import { Button } from "@/components/ui/button"
 import { Separator } from "@/components/ui/separator"
 import type { Bounty } from "@/types/bounty"
-import { Github, Link2, Clock, Calendar, Check } from "lucide-react"
+import { Github, Link2, Clock, Calendar, Check, Loader2 } from "lucide-react"
 import { formatDistanceToNow } from "date-fns"
-import { cn } from "@/lib/utils"
+// import { cn } from "@/lib/utils"
+// import { useRouter } from "next/navigation" // If we need refresh
+import { ApplicationDialog } from "./application-dialog"
+import { toast } from "sonner"
 
 interface BountySidebarProps {
   bounty: Bounty
@@ -14,8 +17,13 @@ interface BountySidebarProps {
 
 export function BountySidebar({ bounty }: BountySidebarProps) {
   const [copied, setCopied] = useState(false)
+  const [loading, setLoading] = useState(false)
+  // const router = useRouter()
 
-  const isClaimable = bounty.status === "open"
+  // Mock user ID for now - in real app this comes from auth context
+  const CURRENT_USER_ID = "mock-user-123"
+
+  // const isClaimable = bounty.status === "open"
 
   const createdTimeAgo = useMemo(
     () => formatDistanceToNow(new Date(bounty.createdAt), { addSuffix: true }),
@@ -39,15 +47,111 @@ export function BountySidebar({ bounty }: BountySidebarProps) {
     }
   }
 
-  const claimButtonText = bounty.status === "claimed"
-    ? "Already Claimed"
-    : bounty.status === "closed"
-      ? "Bounty Closed"
-      : "Claim Bounty"
+  const handleAction = async (endpoint: string, body: object = {}): Promise<boolean> => {
+    setLoading(true)
+    try {
+      const res = await fetch(endpoint, {
+        method: 'POST',
+        headers: { 'Content-Type': 'application/json' },
+        body: JSON.stringify({ contributorId: CURRENT_USER_ID, ...body })
+      })
+
+      if (!res.ok) {
+        const error = await res.json()
+        alert(error.error || 'Action failed')
+        return false
+      }
+
+      toast('Action completed successfully')
+      window.location.reload()
+      return true
+
+    } catch (error) {
+      console.error('Action error:', error)
+      alert('Something went wrong')
+      return false
+    } finally {
+      setLoading(false)
+    }
+  }
+
+  const renderActionButton = () => {
+    if (bounty.status !== 'open') {
+      const labels: Record<string, string> = {
+        claimed: 'Already Claimed',
+        closed: 'Bounty Closed'
+      }
+      return (
+        <Button disabled className="w-full gap-2 bg-gray-800 text-gray-400 cursor-not-allowed">
+          {labels[bounty.status] || 'Not Available'}
+        </Button>
+      )
+    }
+
+    // Check participation
+    if (bounty.claimingModel === 'application' && bounty.applicants?.includes(CURRENT_USER_ID)) {
+      return (
+        <Button disabled className="w-full gap-2 bg-gray-800 text-gray-400 cursor-not-allowed">
+          Application Submitted
+        </Button>
+      )
+    }
+
+    if (bounty.claimingModel === 'competition' && bounty.competitors?.includes(CURRENT_USER_ID)) {
+      return (
+        <Button disabled className="w-full gap-2 bg-gray-800 text-gray-400 cursor-not-allowed">
+          Already Joined
+        </Button>
+      )
+    }
 
-  const claimButtonAriaLabel = !isClaimable
-    ? `Cannot claim: ${claimButtonText}`
-    : "Claim this bounty"
+    if (bounty.claimingModel === 'milestone' && bounty.members?.includes(CURRENT_USER_ID)) {
+      return (
+        <Button disabled className="w-full gap-2 bg-gray-800 text-gray-400 cursor-not-allowed">
+          Already Joined
+        </Button>
+      )
+    }
+
+    if (bounty.claimingModel === 'application') {
+      return (
+        <ApplicationDialog
+          bountyTitle={bounty.issueTitle}
+          trigger={
+            <Button className="w-full gap-2 bg-primary text-primary-foreground hover:bg-primary/90">
+              Apply Now
+            </Button>
+          }
+          onApply={async (data) => {
+            return await handleAction(`/api/bounties/${bounty.id}/apply`, { ...data, applicantId: CURRENT_USER_ID })
+          }}
+        />
+      )
+    }
+
+    let label = 'Claim Bounty'
+    let endpoint = `/api/bounties/${bounty.id}/claim`
+    const body = {}
+
+    if (bounty.claimingModel === 'competition') {
+      label = 'Join Competition'
+      endpoint = `/api/bounties/${bounty.id}/competition/join`
+    } else if (bounty.claimingModel === 'milestone') {
+      label = 'Join Milestone'
+      endpoint = `/api/bounties/${bounty.id}/join`
+    }
+
+    return (
+      <Button
+        onClick={() => handleAction(endpoint, body)}
+        disabled={loading}
+        className="w-full gap-2 bg-primary text-primary-foreground hover:bg-primary/90"
+      >
+        {loading && <Loader2 className="mr-2 h-4 w-4 animate-spin" />}
+        {label}
+      </Button>
+    )
+  }
 
   return (
     <div className="sticky top-4 rounded-xl border border-gray-800 bg-background-card p-6 space-y-4">
@@ -58,24 +162,10 @@ export function BountySidebar({ bounty }: BountySidebarProps) {
         </a>
       </Button>
 
-      <Button
-        className={cn(
-          "w-full gap-2",
-          isClaimable
-            ? "bg-primary text-primary-foreground hover:bg-primary/90"
-            : "bg-gray-800 text-gray-400 cursor-not-allowed"
-        )}
-        disabled={!isClaimable}
-        aria-label={claimButtonAriaLabel}
-        title={!isClaimable ? claimButtonText : undefined}
-      >
-        {claimButtonText}
-      </Button>
+      {renderActionButton()}
 
       <Separator className="bg-gray-800" />
 
-
-
       <a
         href={`https://github.com/${bounty.githubRepo}`}
         target="_blank"
diff --git a/lib/server-auth.ts b/lib/server-auth.ts
new file mode 100644
index 0000000..33252a6
--- /dev/null
+++ b/lib/server-auth.ts
@@ -0,0 +1,28 @@
+import { cookies } from "next/headers";
+
+export interface User {
+    id: string;
+    name: string;
+    email?: string;
+}
+
+export async function getCurrentUser(): Promise<User | null> {
+    // In a real implementation, this would use the better-auth server instance:
+    // const session = await auth.api.getSession({ headers: await headers() });
+    // return session?.user;
+
+    // For now, checks for the cookie used in proxy.ts as a weak signal, 
+    // or returns a mock user in development.
+    const cookieStore = await cookies();
+    const sessionCookie = cookieStore.get("boundless_auth.session_token") || cookieStore.get("boundless_auth");
+
+    if (process.env.NODE_ENV === "development" || sessionCookie) {
+        return {
+            id: "mock-user-123",
+            name: "Mock User",
+            email: "mock@example.com"
+        };
+    }
+
+    return null;
+}
diff --git a/lib/store.test.ts b/lib/store.test.ts
index 782247f..93017f7 100644
--- a/lib/store.test.ts
+++ b/lib/store.test.ts
@@ -1,4 +1,4 @@
-import { describe, it, expect, beforeEach } from 'vitest';
+import { describe, it, expect } from 'vitest';
 import { BountyStore } from './store';
 import { Application, Submission, MilestoneParticipation } from '@/types/participation';
 
diff --git a/lib/store.ts b/lib/store.ts
index e742039..ef04dd9 100644
--- a/lib/store.ts
+++ b/lib/store.ts
@@ -1,5 +1,5 @@
 import { Bounty } from "@/types/bounty";
-import { Application, Submission, MilestoneParticipation } from "@/types/participation";
+import { Application, Submission, MilestoneParticipation, CompetitionParticipation } from "@/types/participation";
 import { mockBounties } from "./mock-bounty";
 
 class BountyStoreData {
@@ -7,6 +7,7 @@ class BountyStoreData {
     applications: Application[] = [];
     submissions: Submission[] = [];
     milestoneParticipations: MilestoneParticipation[] = [];
+    competitionParticipations: CompetitionParticipation[] = [];
 }
 
 declare global {
@@ -65,5 +66,21 @@ export const BountyStore = {
         if (index === -1) return null;
         globalStore.milestoneParticipations[index] = { ...globalStore.milestoneParticipations[index], ...updates };
         return globalStore.milestoneParticipations[index];
+    },
+
+    // Competitions
+    addCompetitionParticipation: (cp: CompetitionParticipation) => {
+        globalStore.competitionParticipations.push(cp);
+        return cp;
+    },
+    getCompetitionParticipationsByBounty: (bountyId: string) =>
+        globalStore.competitionParticipations.filter((c: CompetitionParticipation) => c.bountyId === bountyId),
+
+    // Generic Bounty Update (for status changes)
+    updateBounty: (bountyId: string, updates: Partial<Bounty>) => {
+        const index = globalStore.bounties.findIndex((b: Bounty) => b.id === bountyId);
+        if (index === -1) return null;
+        globalStore.bounties[index] = { ...globalStore.bounties[index], ...updates };
+        return globalStore.bounties[index];
     }
 };
diff --git a/types/bounty.ts b/types/bounty.ts
index 9e367ee..7753ea0 100644
--- a/types/bounty.ts
+++ b/types/bounty.ts
@@ -53,6 +53,11 @@ export interface Bounty {
   requirements?: string[]
   scope?: string
   milestones?: unknown[] // Optional milestone definition
+
+  // Participation Lists (User IDs)
+  applicants?: string[]
+  competitors?: string[]
+  members?: string[] // For milestone/collaborative bounties
 }
 
 export type BountyStatus = Bounty['status']
diff --git a/types/participation.ts b/types/participation.ts
index 9d8a042..7714534 100644
--- a/types/participation.ts
+++ b/types/participation.ts
@@ -40,3 +40,13 @@ export interface MilestoneParticipation {
     lastUpdatedAt: string
     totalMilestones?: number // Optional override or cached value
 }
+
+export type CompetitionStatus = 'registered' | 'qualified' | 'disqualified' | 'winner'
+
+export interface CompetitionParticipation {
+    id: string
+    bountyId: string
+    contributorId: string
+    status: CompetitionStatus
+    registeredAt: string
+}