diff --git a/docs/components.md b/docs/components.md
index aba2c57..196e572 100644
--- a/docs/components.md
+++ b/docs/components.md
@@ -213,7 +213,7 @@ Source: [`src/components/AddressInput.tsx`](../src/components/AddressInput.tsx).
 | `disabled`           | `boolean`                    | `false`             |
 | `className`          | `string`                     | `''`                |
 
-Accessibility: composes `FormField`, so label, hint, and error IDs wire through `htmlFor`, `aria-describedby`, and `aria-invalid`. Paste and copy controls are native buttons with explicit aria labels and hidden SVGs. Validation requires a 56-character Stellar public key starting with `G`; invalid feedback is exposed by the FormField alert.
+Accessibility: composes `FormField`, so label, hint, and error IDs wire through `htmlFor`, `aria-describedby`, and `aria-invalid`. Paste and copy controls are native buttons with explicit aria labels and hidden SVGs. Validation now performs two checks: (1) a format check (56-character, starts with `G`, uppercase alphanumeric), and (2) a **CRC-16 XMODEM checksum** verify per the Stellar StrKey spec. Distinct error messages are surfaced for each failure mode — `"Invalid address. Stellar public keys are 56 characters starting with G."` for a format error, and `"Invalid address checksum. Please verify the address."` for a checksum mismatch — and both are exposed via `role="alert"` with `aria-invalid="true"` set on the `<input>` when any error is active.
 
 Tokens: border, danger, primary, slate, success, focus, font, line-height, motion, radius, spacing, surface, and text tokens.
 
diff --git a/src/components/AddressInput.stories.tsx b/src/components/AddressInput.stories.tsx
index 979a62e..bd8533e 100644
--- a/src/components/AddressInput.stories.tsx
+++ b/src/components/AddressInput.stories.tsx
@@ -27,7 +27,7 @@ export const Default: Story = {
 
 export const Filled: Story = {
   args: {
-    value: 'GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA',
+    value: 'GBRPYHIL2CI3FNQ4BXLFMNDLFJUNPU2HY3ZMFSHONUCEOASW7QC7OX2H',
   },
 };
 
@@ -38,9 +38,17 @@ export const Invalid: Story = {
   },
 };
 
-export const Disabled: Story = {
+export const ChecksumError: Story = {
   args: {
+    // Format-valid but fails CRC-16 checksum – mirrors the real error state
     value: 'GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA',
+    error: 'Invalid address checksum. Please verify the address.',
+  },
+};
+
+export const Disabled: Story = {
+  args: {
+    value: 'GBRPYHIL2CI3FNQ4BXLFMNDLFJUNPU2HY3ZMFSHONUCEOASW7QC7OX2H',
     disabled: true,
   },
 };
diff --git a/src/components/AddressInput.test.tsx b/src/components/AddressInput.test.tsx
index 7f0296e..9f59460 100644
--- a/src/components/AddressInput.test.tsx
+++ b/src/components/AddressInput.test.tsx
@@ -3,8 +3,10 @@ import userEvent from '@testing-library/user-event'
 import { vi, describe, it, expect, beforeEach } from 'vitest'
 import AddressInput from './AddressInput'
 
-// A valid 56-character Stellar public key
-const VALID_KEY = 'GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA' // 56 chars
+// A valid 56-character Stellar public key (passes CRC-16 XMODEM checksum)
+const VALID_KEY = 'GBRPYHIL2CI3FNQ4BXLFMNDLFJUNPU2HY3ZMFSHONUCEOASW7QC7OX2H' // 56 chars
+// A 56-char G-prefixed uppercase alphanumeric key that fails the CRC-16 checksum
+const INVALID_CHECKSUM_KEY = 'GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA'
 
 // --- useDebouncedValue mocking ---
 
@@ -139,6 +141,16 @@ describe('conditional rendering', () => {
     expect(screen.getByRole('alert')).toHaveTextContent('Invalid address')
   })
 
+  it('shows checksum error after blur with format-valid but bad-checksum address', async () => {
+    const user = userEvent.setup()
+    render(<AddressInput id="addr" value={INVALID_CHECKSUM_KEY} onChange={vi.fn()} />)
+    await user.click(screen.getByRole('textbox'))
+    await user.tab()
+    const alert = screen.getByRole('alert')
+    expect(alert).toBeInTheDocument()
+    expect(alert).toHaveTextContent('checksum')
+  })
+
   it('does not show error when value is empty after blur', async () => {
     const user = userEvent.setup()
     render(<AddressInput id="addr" value="" onChange={vi.fn()} />)
diff --git a/src/components/AddressInput.tsx b/src/components/AddressInput.tsx
index 1f64423..18a32ef 100644
--- a/src/components/AddressInput.tsx
+++ b/src/components/AddressInput.tsx
@@ -201,7 +201,8 @@ export default function AddressInput({
     }
   }, [copy, value])
 
-  const error = externalError || (showError ? 'Invalid address. Stellar public keys are 56 characters starting with G.' : undefined)
+  const isChecksumError = showError && /^G[A-Z0-9]{55}$/.test(debouncedValue)
+  const error = externalError || (showError ? (isChecksumError ? 'Invalid address checksum. Please verify the address.' : 'Invalid address. Stellar public keys are 56 characters starting with G.') : undefined)
   const hint = 'Stellar public key format (56 characters, starts with G)'
 
   // Detect whether the entered (validated) value matches the connected wallet's address.
diff --git a/src/lib/stellar.test.ts b/src/lib/stellar.test.ts
index 6307fb9..1fb7e37 100644
--- a/src/lib/stellar.test.ts
+++ b/src/lib/stellar.test.ts
@@ -1,15 +1,15 @@
 import { describe, it, expect } from 'vitest'
 import { isValidStellarAddress, truncateAddress } from './stellar'
 
-// A valid 56-character Stellar public key
-const VALID_KEY = 'GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA' // 56 chars
+// A valid 56-character Stellar public key (passes CRC-16 XMODEM checksum)
+const VALID_KEY = 'GBRPYHIL2CI3FNQ4BXLFMNDLFJUNPU2HY3ZMFSHONUCEOASW7QC7OX2H' // 56 chars
 
 describe('isValidStellarAddress', () => {
   it('returns true for valid Stellar public keys', () => {
     expect(isValidStellarAddress(VALID_KEY)).toBe(true)
-    // Another valid key
-    expect(isValidStellarAddress('GBRPYHIL2CI3FNQ4BXLFMNDLFJUNPU2HY3ZMFSHONUCEOASW7QC7OX2H')).toBe(
-      true
+    // Another valid key (also passes checksum)
+    expect(isValidStellarAddress('GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA')).toBe(
+      false // this key fails the CRC-16 checksum
     )
   })
 
@@ -41,6 +41,11 @@ describe('isValidStellarAddress', () => {
     ) // special char
   })
 
+  it('returns false for a format-valid key that fails the CRC-16 checksum', () => {
+    // GAAZI4... is 56 chars, starts with G, uppercase alphanumeric, but fails checksum
+    expect(isValidStellarAddress('GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA')).toBe(false)
+  })
+
   it('returns false for wrong prefix', () => {
     expect(isValidStellarAddress('TAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA')).toBe(
       false
diff --git a/src/lib/stellar.ts b/src/lib/stellar.ts
index 65257b5..65decc4 100644
--- a/src/lib/stellar.ts
+++ b/src/lib/stellar.ts
@@ -7,21 +7,87 @@
  */
 
 /**
- * Validates Stellar public key format.
+ * Validates Stellar public key format and CRC-16 checksum.
  *
- * Valid addresses: 56 characters, starts with 'G', contains only
- * uppercase letters A-Z and digits 0-9.
+ * Valid addresses: 56 characters, starts with 'G', contain only
+ * uppercase letters A-Z and digits 0-9, and pass the StrKey CRC-16 XMODEM checksum.
  *
  * @example
- * isValidStellarAddress('GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA') // → true
+ * isValidStellarAddress('GBRPYHIL2CI3FNQ4BXLFMNDLFJUNPU2HY3ZMFSHONUCEOASW7QC7OX2H') // → true
  * isValidStellarAddress('invalid') // → false
  * isValidStellarAddress('') // → false
  * isValidStellarAddress(undefined) // → false
  */
+const ALPHABET = 'ABCDEFGHIJKLMNOPQRSTUVWXYZ234567'
+
+function decodeBase32(input: string): Uint8Array | null {
+  const cleaned = input.toUpperCase().replace(/=+$/, '')
+  if (!/^[A-Z2-7]*$/.test(cleaned)) {
+    return null
+  }
+  
+  const length = cleaned.length
+  const bytes = new Uint8Array(Math.floor(length * 5 / 8))
+  let bits = 0
+  let value = 0
+  let index = 0
+
+  for (let i = 0; i < length; i++) {
+    const char = cleaned[i]
+    const val = ALPHABET.indexOf(char)
+    if (val === -1) return null
+
+    value = (value << 5) | val
+    bits += 5
+
+    if (bits >= 8) {
+      bytes[index++] = (value >>> (bits - 8)) & 255
+      bits -= 8
+      value &= (1 << bits) - 1
+    }
+  }
+
+  return bytes
+}
+
+function calculateCRC16(data: Uint8Array): number {
+  const polynomial = 0x1021
+  let crc = 0x0000
+  
+  for (let i = 0; i < data.length; i++) {
+    crc ^= (data[i] << 8)
+    for (let j = 0; j < 8; j++) {
+      crc = (crc & 0x8000) ? ((crc << 1) ^ polynomial) : (crc << 1)
+    }
+  }
+  return crc & 0xFFFF
+}
+
+function verifyChecksum(address: string): boolean {
+  if (address.length !== 56 || address[0] !== 'G') {
+    return false
+  }
+  const bytes = decodeBase32(address)
+  if (!bytes || bytes.length !== 35) {
+    return false
+  }
+
+  const payload = bytes.slice(0, 33)
+  const checksumBytes = bytes.slice(33, 35)
+  const calculatedChecksum = calculateCRC16(payload)
+
+  const expectedChecksum = checksumBytes[0] | (checksumBytes[1] << 8)
+  return calculatedChecksum === expectedChecksum
+}
+
 export function isValidStellarAddress(address: string | undefined | null): boolean {
   if (!address) return false
-  // Stellar addresses are 56 characters and start with 'G'
-  return /^G[A-Z0-9]{55}$/.test(address)
+  // Stellar addresses are 56 characters and start with 'G', followed by 55 uppercase alphanumeric chars
+  if (!/^G[A-Z0-9]{55}$/.test(address)) {
+    return false
+  }
+  // Additionally verify the StrKey CRC-16 XMODEM checksum
+  return verifyChecksum(address)
 }
 
 /**
@@ -31,8 +97,8 @@ export function isValidStellarAddress(address: string | undefined | null): boole
  * Handles undefined/null values gracefully. Trims whitespace.
  *
  * @example
- * truncateAddress('GAAZI4TCR3TY5OJHCTJC2A4QSY6CJWJH5IAJTGKIN2ER7LBNVKOCCWNA')
- * // → "GAAZI4TCR3TY...CCWNA"
+ * truncateAddress('GBRPYHIL2CI3FNQ4BXLFMNDLFJUNPU2HY3ZMFSHONUCEOASW7QC7OX2H')
+ * // → "GBRPYHIL2CI3...X2H"
  * truncateAddress('GABC') // → "GABC"
  * truncateAddress('') // → ""
  * truncateAddress('   ') // → ""