diff --git a/openhands/cli/main.py b/openhands/cli/main.py
index e704a3a889..89ed49d3ce 100644
--- a/openhands/cli/main.py
+++ b/openhands/cli/main.py
@@ -364,7 +364,16 @@ async def main_with_loop(loop: asyncio.AbstractEventLoop) -> None:
     """Runs the agent in CLI mode."""
     args = parse_arguments()
 
-    logger.setLevel(logging.WARNING)
+    # Set log level from command line argument if provided
+    if args.log_level and isinstance(args.log_level, str):
+        log_level = getattr(logging, str(args.log_level).upper())
+        logger.setLevel(log_level)
+    else:
+        # Set default log level to WARNING if no LOG_LEVEL environment variable is set
+        # (command line argument takes precedence over environment variable)
+        env_log_level = os.getenv('LOG_LEVEL')
+        if not env_log_level:
+            logger.setLevel(logging.WARNING)
 
     # Load config from toml and override with command line arguments
     config: OpenHandsConfig = setup_config_from_args(args)
diff --git a/tests/unit/test_cli.py b/tests/unit/test_cli.py
index d7ea41135d..47662702d0 100644
--- a/tests/unit/test_cli.py
+++ b/tests/unit/test_cli.py
@@ -790,6 +790,7 @@ async def test_config_loading_order(
     mock_args.llm_config = None  # This should allow settings to be used
     # Add a file property to avoid file I/O errors
     mock_args.file = None
+    mock_args.log_level = 'INFO'
     mock_parse_args.return_value = mock_args
 
     # Mock read_task to return a dummy task