diff --git a/effekt/jvm/src/main/scala/effekt/Driver.scala b/effekt/jvm/src/main/scala/effekt/Driver.scala
index c101df88e..c276495da 100644
--- a/effekt/jvm/src/main/scala/effekt/Driver.scala
+++ b/effekt/jvm/src/main/scala/effekt/Driver.scala
@@ -9,7 +9,7 @@ import effekt.context.{ Context, IOModuleDB }
 import kiama.output.PrettyPrinterTypes.Document
 import kiama.parsing.ParseResult
 import kiama.util.{ IO, Source }
-import effekt.util.messages.{ BufferedMessaging, CompilerPanic, EffektError, EffektMessaging, FatalPhaseError }
+import effekt.util.messages.{ BufferedMessaging, CompilerPanic, EffektError, EffektMessaging, FatalPhaseError, PlainTextError }
 import effekt.util.paths.file
 import effekt.util.{ AnsiColoredMessaging, MarkdownSource, getOrElseAborting }
 
@@ -88,11 +88,8 @@ trait Driver extends kiama.util.Compiler[EffektConfig, EffektError] { outer =>
     }
   } catch {
     case FatalPhaseError(msg) => context.report(msg)
-    case e @ CompilerPanic(msg) =>
-      context.report(msg)
-      e.getStackTrace.foreach { line =>
-        context.info("  at " + line)
-      }
+    case e @ CompilerPanic(msg) => generateCrashReport(e, context, config, msg)
+
     // when in server-mode, do not crash but report the error to avoid
     // restarting the server.
     case e if config.server() =>
@@ -108,6 +105,112 @@ trait Driver extends kiama.util.Compiler[EffektConfig, EffektError] { outer =>
     afterCompilation(source, config)(context)
   }
 
+  def generateCrashReport(e: Throwable, context: Context, config: EffektConfig, msg:effekt. util. messages. EffektError): Unit = {
+    import java.nio.file.{Files, Paths}
+    import java.nio.charset.StandardCharsets
+
+    // Capture general information
+    val errorMessage = msg match {
+      case PlainTextError(content, _, _) => content
+      case _ => msg
+    }
+
+
+    val effektVersion = effekt.util.Version.effektVersion
+    val osInfoName = System.getProperty("os.name")
+    val osInfoArch = System.getProperty("os.arch")
+    val osInfoVersion = System.getProperty("os.version")
+
+    val javaInfoVersion = System.getProperty("java.version")
+    val javaInfoVendor = System.getProperty("java.vendor")
+    val javaInfoRuntime = System.getProperty("java.runtime.name")
+
+    val errorReport = "The compiler unexpectedly panicked. This is a compiler bug.\nPlease report it:"
+    val issueLink = "https://github.com/effekt-lang/effekt/issues/new?labels=bug"
+    val stringWriter = new java.io.StringWriter()
+    e.printStackTrace(new java.io.PrintWriter(stringWriter))
+    val stackTrace = stringWriter.toString
+
+    // Collect backend details (if applicable)
+    val backendInfoName = config.backend() match {
+      case Backend(name, _, _) => name
+      case null => "Backend-specific info Name not retrievable"
+    }
+
+    // Arguments passed to the compiler
+    val argsMarkdown = config.args.mkString("\n", "\n", "\n")
+
+    // Construct the report content
+    val reportContent =
+      s"""|# Effekt Compiler Crash Report
+          |
+          |**ERROR** : $errorMessage
+          |
+          |$errorReport
+          |[Submit an issue]($issueLink)
+          |
+          |### Compiler Information
+          |Effekt Version: $effektVersion \n
+          |Backend: $backendInfoName
+          |
+          |### System Information
+          |Operating System: $osInfoName \n Arch: $osInfoArch \n Version: $osInfoVersion
+          |
+          |JVM Version: $javaInfoVersion ($javaInfoVendor, $javaInfoRuntime)
+          |
+          |### Full Stack Trace
+          |```
+          |$stackTrace
+          |```
+          |
+          |### Arguments Passed to the Compiler
+          |```
+          |$argsMarkdown
+          |```
+          |""".stripMargin
+
+    // Write the report to a Markdown file
+    val outputPath = Paths.get(config.outputPath().getAbsolutePath)
+    val outputFile = outputPath.resolve("crash-report.md")
+    try {
+      Files.createDirectories(outputPath.getParent)
+      Files.write(outputFile, reportContent.getBytes(StandardCharsets.UTF_8))
+      //context.info(s"Crash report saved to: $outputPath")
+    } catch {
+      case ex: Exception =>
+        context.info("Failed to save crash report to file: " + ex.getMessage)
+    }
+
+    // Provide the report link in the user-visible output
+    val report =
+      s"""|=== Effekt Compiler Crash Report ===
+          |
+          |[Error] $errorMessage
+          |
+          |The compiler unexpectedly panicked. This is a compiler bug.
+          |Please report it: $issueLink
+          |
+          |Effekt Version: $effektVersion\n
+          |Backend used: $backendInfoName
+          |
+          |A detailed crash report has been written to:
+          |${outputPath.toAbsolutePath}
+          |
+          |Operating System: $osInfoName
+          |
+          |JVM Version: $javaInfoVersion
+          |
+          |Full Stack Trace:
+          |$stackTrace
+          |
+          |Arguments passed to the compiler:
+          |$argsMarkdown
+          |""".stripMargin
+
+    // Print the report to console
+    context.info(report)
+  }
+
   /**
    * Outputs the timing information captured in [[effekt.util.Timers]] by [[effekt.context.Context]]. Either a JSON file
    * is written to disk or a plain text message is written to stdout.