diff --git a/.env.example b/.env.example
index f1292e9..5824c1d 100644
--- a/.env.example
+++ b/.env.example
@@ -30,6 +30,12 @@ MUSIC_SERVICE=SquidWTF
 # Path where downloaded songs will be stored on the host (only applies if STORAGE_MODE=Permanent)
 DOWNLOAD_PATH=./downloads
 
+# Path where favorited external tracks are permanently kept
+KEPT_PATH=./kept
+
+# Path for cache files (Spotify missing tracks, etc.)
+CACHE_PATH=./cache
+
 # ===== SQUIDWTF CONFIGURATION =====
 # Different quality options for SquidWTF. Only FLAC supported right now
 SQUIDWTF_QUALITY=FLAC
diff --git a/README.md b/README.md
index b3432b7..08b19d3 100644
--- a/README.md
+++ b/README.md
@@ -83,6 +83,7 @@ This project brings together all the music streaming providers into one unified
 - **Transparent Proxy**: Sits between your music clients and media server
 - **Automatic Search**: Searches streaming providers when songs aren't local
 - **On-the-Fly Downloads**: Songs download and cache for future use
+- **Favorite to Keep**: When you favorite an external track, it's automatically copied to a permanent `/kept` folder separate from the cache
 - **External Playlist Support**: Search and download playlists from Deezer, Qobuz, and SquidWTF with M3U generation
 - **Hi-Res Audio**: SquidWTF supports up to 24-bit/192kHz FLAC
 - **Full Metadata**: Downloaded files include complete ID3 tags (title, artist, album, track number, year, genre, BPM, ISRC, etc.) and cover art
diff --git a/allstarr/Controllers/JellyfinController.cs b/allstarr/Controllers/JellyfinController.cs
index faba802..5b339c5 100644
--- a/allstarr/Controllers/JellyfinController.cs
+++ b/allstarr/Controllers/JellyfinController.cs
@@ -1118,12 +1118,24 @@ public class JellyfinController : ControllerBase
         }
 
         // Check if this is an external song/album
-        var (isExternal, _, _) = _localLibraryService.ParseSongId(itemId);
+        var (isExternal, provider, externalId) = _localLibraryService.ParseSongId(itemId);
         if (isExternal)
         {
-            // External items don't exist in Jellyfin, so we can't favorite them there
-            // Just return success - the client will show it as favorited
-            _logger.LogDebug("Favoriting external item {ItemId} (not synced to Jellyfin)", itemId);
+            _logger.LogInformation("Favoriting external item {ItemId}, copying to kept folder", itemId);
+            
+            // Copy the track to kept folder in background
+            _ = Task.Run(async () =>
+            {
+                try
+                {
+                    await CopyExternalTrackToKeptAsync(itemId, provider!, externalId!);
+                }
+                catch (Exception ex)
+                {
+                    _logger.LogError(ex, "Failed to copy external track {ItemId} to kept folder", itemId);
+                }
+            });
+            
             return Ok(new { IsFavorite = true });
         }
 
@@ -2083,6 +2095,76 @@ public class JellyfinController : ControllerBase
         }
     }
 
+    /// <summary>
+    /// Copies an external track to the kept folder when favorited.
+    /// </summary>
+    private async Task CopyExternalTrackToKeptAsync(string itemId, string provider, string externalId)
+    {
+        try
+        {
+            // Get the song metadata
+            var song = await _metadataService.GetSongAsync(provider, externalId);
+            if (song == null)
+            {
+                _logger.LogWarning("Could not find song metadata for {ItemId}", itemId);
+                return;
+            }
+
+            // Check if file exists in downloads folder
+            var downloadPath = PathHelper.GetSongPath(song.Artist, song.Album, song.Title);
+            if (!System.IO.File.Exists(downloadPath))
+            {
+                _logger.LogInformation("Track not yet downloaded, triggering download for {ItemId}", itemId);
+                
+                // Download the track first
+                var downloadResult = await _downloadService.DownloadSongAsync(provider, externalId);
+                if (!downloadResult.IsSuccess)
+                {
+                    _logger.LogWarning("Failed to download track {ItemId}: {Error}", itemId, downloadResult.Error);
+                    return;
+                }
+                
+                downloadPath = downloadResult.Value!.FilePath;
+            }
+
+            // Create kept folder structure: /app/kept/Artist/Album/
+            var keptBasePath = "/app/kept";
+            var keptArtistPath = Path.Combine(keptBasePath, PathHelper.SanitizeFileName(song.Artist));
+            var keptAlbumPath = Path.Combine(keptArtistPath, PathHelper.SanitizeFileName(song.Album));
+            
+            Directory.CreateDirectory(keptAlbumPath);
+
+            // Copy file to kept folder
+            var fileName = Path.GetFileName(downloadPath);
+            var keptFilePath = Path.Combine(keptAlbumPath, fileName);
+
+            if (System.IO.File.Exists(keptFilePath))
+            {
+                _logger.LogInformation("Track already exists in kept folder: {Path}", keptFilePath);
+                return;
+            }
+
+            System.IO.File.Copy(downloadPath, keptFilePath, overwrite: false);
+            _logger.LogInformation("✓ Copied favorited track to kept folder: {Path}", keptFilePath);
+            
+            // Also copy cover art if it exists
+            var coverPath = Path.Combine(Path.GetDirectoryName(downloadPath)!, "cover.jpg");
+            if (System.IO.File.Exists(coverPath))
+            {
+                var keptCoverPath = Path.Combine(keptAlbumPath, "cover.jpg");
+                if (!System.IO.File.Exists(keptCoverPath))
+                {
+                    System.IO.File.Copy(coverPath, keptCoverPath, overwrite: false);
+                    _logger.LogDebug("Copied cover art to kept folder");
+                }
+            }
+        }
+        catch (Exception ex)
+        {
+            _logger.LogError(ex, "Error copying external track {ItemId} to kept folder", itemId);
+        }
+    }
+
     /// <summary>
     /// Loads missing tracks from file cache as fallback when Redis is empty.
     /// </summary>
diff --git a/docker-compose.yml b/docker-compose.yml
index 73f572e..ec79566 100644
--- a/docker-compose.yml
+++ b/docker-compose.yml
@@ -93,6 +93,8 @@ services:
       - Qobuz__Quality=${QOBUZ_QUALITY:-FLAC}
     volumes:
       - ${DOWNLOAD_PATH:-./downloads}:/app/downloads
+      - ${KEPT_PATH:-./kept}:/app/kept
+      - ${CACHE_PATH:-./cache}:/app/cache
 
 networks:
   allstarr-network: