diff --git a/core/services.py b/core/services.py
index e4920fe..bccc0c3 100644
--- a/core/services.py
+++ b/core/services.py
@@ -3,7 +3,7 @@
 import time
 from typing import Optional
 
-from core.models import Bounty, RoomData, TrackedBounty, TrackingData
+from core.models import Bounty, Category, RoomData, TrackedBounty, TrackingData
 from core.ports import RoomStorage, TrackingStorage
 
 
@@ -289,6 +289,234 @@ class BountyService:
             results[bounty_id] = "deleted"
         return results
 
+    # --- Category Management ---
+
+    def add_category(
+        self,
+        room_id: int,
+        slug: str,
+        name: str,
+        username: str | None,
+    ) -> Category:
+        """Create a new category. Admin only.
+
+        Args:
+            room_id: Room identifier
+            slug: Category ID (lowercase alphabetic, e.g., "bug")
+            name: Display name (e.g., "Bug Report")
+            username: Requesting admin's username
+
+        Returns:
+            Created Category
+
+        Raises:
+            PermissionError: If not admin
+            ValueError: If slug already exists or invalid
+        """
+        if not self.is_admin(room_id, username):
+            raise PermissionError("Only admins can add categories.")
+
+        # Validate slug format (lowercase alphabetic only)
+        if not slug or not slug.isalpha() or not slug.islower():
+            raise ValueError(
+                "Category slug must be lowercase alphabetic only (e.g., 'bug', 'feature')."
+            )
+
+        room_data = self._storage.load(room_id)
+        if room_data is None:
+            room_data = RoomData(
+                room_id=room_id, bounties=[], next_id=1, admin_usernames=[], categories=[]
+            )
+
+        # Check for duplicate slug
+        for cat in room_data.categories:
+            if cat.id == slug and cat.deleted_at is None:
+                raise ValueError(f"Category '{slug}' already exists.")
+
+        category = Category(
+            id=slug,
+            name=name,
+            created_at=int(time.time()),
+            deleted_at=None,
+        )
+        room_data.categories.append(category)
+        self._storage.save(room_data)
+        return category
+
+    def delete_category(
+        self,
+        room_id: int,
+        slug: str,
+        username: str | None,
+    ) -> bool:
+        """Soft delete a category. Admin only.
+
+        Args:
+            room_id: Room identifier
+            slug: Category slug to delete
+            username: Requesting admin's username
+
+        Returns:
+            True if deleted, False if not found
+        """
+        if not self.is_admin(room_id, username):
+            raise PermissionError("Only admins can delete categories.")
+
+        room_data = self._storage.load(room_id)
+        if room_data is None:
+            return False
+
+        for cat in room_data.categories:
+            if cat.id == slug and cat.deleted_at is None:
+                cat.deleted_at = int(time.time())
+                self._storage.save(room_data)
+                return True
+        return False
+
+    def list_categories(self, room_id: int) -> list[Category]:
+        """List active categories (excludes soft-deleted).
+
+        Args:
+            room_id: Room identifier
+
+        Returns:
+            List of active categories
+        """
+        room_data = self._storage.load(room_id)
+        if room_data is None:
+            return []
+        return [c for c in room_data.categories if c.deleted_at is None]
+
+    def get_category(self, room_id: int, slug: str) -> Category | None:
+        """Get a category by slug (excludes soft-deleted).
+
+        Args:
+            room_id: Room identifier
+            slug: Category slug
+
+        Returns:
+            Category or None if not found
+        """
+        room_data = self._storage.load(room_id)
+        if room_data is None:
+            return None
+        for cat in room_data.categories:
+            if cat.id == slug and cat.deleted_at is None:
+                return cat
+        return None
+
+    def _validate_category_exists(self, room_id: int, slug: str) -> None:
+        """Validate that a category exists (and is not deleted). Raises ValueError if not found."""
+        if not self.get_category(room_id, slug):
+            raise ValueError(f"Category '{slug}' not found.")
+
+    def add_category_to_bounty(
+        self,
+        room_id: int,
+        bounty_id: int,
+        category_slug: str,
+        username: str | None,
+    ) -> bool:
+        """Add category to a bounty. Admin only.
+
+        Args:
+            room_id: Room identifier
+            bounty_id: Bounty ID
+            category_slug: Category slug to add
+            username: Requesting admin's username
+
+        Returns:
+            True if newly added, False if already exists
+
+        Raises:
+            PermissionError: If not admin
+            ValueError: If bounty or category not found
+        """
+        if not self.is_admin(room_id, username):
+            raise PermissionError("Only admins can manage bounty categories.")
+
+        bounty = self.get_bounty(room_id, bounty_id)
+        if not bounty:
+            raise ValueError("Bounty not found.")
+
+        self._validate_category_exists(room_id, category_slug)
+
+        if category_slug in bounty.category_ids:
+            return False  # Already exists
+
+        bounty.category_ids.append(category_slug)
+        self._storage.update_bounty(room_id, bounty)
+        return True
+
+    def remove_category_from_bounty(
+        self,
+        room_id: int,
+        bounty_id: int,
+        category_slug: str,
+        username: str | None,
+    ) -> bool:
+        """Remove category from a bounty. Admin only.
+
+        Args:
+            room_id: Room identifier
+            bounty_id: Bounty ID
+            category_slug: Category slug to remove
+            username: Requesting admin's username
+
+        Returns:
+            True if removed, False if not found
+        """
+        if not self.is_admin(room_id, username):
+            raise PermissionError("Only admins can manage bounty categories.")
+
+        bounty = self.get_bounty(room_id, bounty_id)
+        if not bounty:
+            raise ValueError("Bounty not found.")
+
+        if category_slug not in bounty.category_ids:
+            return False
+
+        bounty.category_ids.remove(category_slug)
+        self._storage.update_bounty(room_id, bounty)
+        return True
+
+    def update_bounty_categories(
+        self,
+        room_id: int,
+        bounty_id: int,
+        category_slugs: list[str],
+        username: str | None,
+    ) -> bool:
+        """Replace all categories on a bounty. Admin only.
+
+        Args:
+            room_id: Room identifier
+            bounty_id: Bounty ID
+            category_slugs: New list of category slugs
+            username: Requesting admin's username
+
+        Returns:
+            True if updated
+
+        Raises:
+            PermissionError: If not admin
+            ValueError: If bounty or any category not found
+        """
+        if not self.is_admin(room_id, username):
+            raise PermissionError("Only admins can manage bounty categories.")
+
+        bounty = self.get_bounty(room_id, bounty_id)
+        if not bounty:
+            raise ValueError("Bounty not found.")
+
+        # Validate all categories exist
+        for slug in category_slugs:
+            self._validate_category_exists(room_id, slug)
+
+        bounty.category_ids = category_slugs
+        self._storage.update_bounty(room_id, bounty)
+        return True
+
 
 class TrackingService:
     """Service for tracking bounty operations."""