diff --git a/internal/watermark/stft_watermark.go b/internal/watermark/stft_watermark.go
index 73fc967..460b687 100644
--- a/internal/watermark/stft_watermark.go
+++ b/internal/watermark/stft_watermark.go
@@ -34,12 +34,45 @@ const (
 	GroupsPerBit = 10 // time groups per data bit
 	WMLevelDB = 0.5   // embedding level (dB) — inaudible, 20 dB margin for decode
 
+	// PAFM: Psycho-Acoustic Frequency Masking (Kirovski §III-A).
+	// Only embed/detect in bins where audio provides enough masking.
+	// Bins more than PAFMThresholdDB below local spectral peak are
+	// in spectral valleys — watermark would be audible there, and they
+	// contribute more carrier noise than signal to the correlation.
+	PAFMThresholdDB = 25.0 // dB below local peak → skip bin
+	PAFMNeighborhood = 4   // ± bins for local peak search
+
 	TotalGroups   = GroupsPerBit * payloadBits // 10 × 128 = 1280
 	FramesPerWM   = TotalGroups * TimeRep      // 1280 × 5 = 6400
 	SamplesPerWM  = FramesPerWM * FFTHop       // 6400 × 256 = 1638400
 	// Duration at WMRate: 1638400 / 12000 = 136.5 seconds
 )
 
+// PafmMask computes which bins are "audible" (suitable for embedding/detection).
+// A bin is audible if its magnitude is within PAFMThresholdDB of the local
+// spectral peak (±PAFMNeighborhood bins). Bins in spectral valleys are
+// excluded — they have weak masking and would make the watermark audible.
+//
+// Returns a bitmask: true = embed/detect here, false = skip.
+// On average ~60% of bins are audible (matching Kirovski's observation).
+func PafmMask(magDB []float64) [NumBins]bool {
+	var mask [NumBins]bool
+	for b := 0; b < NumBins; b++ {
+		bin := BinLow + b
+		// Find local peak in neighborhood
+		localPeak := magDB[bin]
+		for j := -PAFMNeighborhood; j <= PAFMNeighborhood; j++ {
+			idx := bin + j
+			if idx >= 0 && idx < len(magDB) && magDB[idx] > localPeak {
+				localPeak = magDB[idx]
+			}
+		}
+		// Bin is audible if within threshold of local peak
+		mask[b] = magDB[bin] >= localPeak-PAFMThresholdDB
+	}
+	return mask
+}
+
 // STFTEmbedder processes audio blocks and adds the STFT-domain watermark.
 // It works at WMRate (12 kHz). The caller must decimate input to WMRate
 // and upsample output back to the desired rate.
@@ -189,7 +222,22 @@ func (e *STFTEmbedder) processFrame() {
 		_ = repIdx
 		_ = centerRep
 
+		// PAFM: compute masking threshold for this frame.
+		// Only embed in bins where audio provides enough masking.
+		var frameMagDB [FFTSize / 2]float64
+		for bin := 0; bin < FFTSize/2; bin++ {
+			mag := cmplx.Abs(buf[bin])
+			if mag < 1e-12 {
+				mag = 1e-12
+			}
+			frameMagDB[bin] = 20 * math.Log10(mag)
+		}
+		mask := PafmMask(frameMagDB[:])
+
 		for b := 0; b < NumBins; b++ {
+			if !mask[b] {
+				continue // PAFM: bin is in spectral valley, skip
+			}
 			bin := BinLow + b
 			chip := float64(e.pnChips[groupIdx][b])
 
@@ -282,9 +330,10 @@ func (d *STFTDetector) Detect(audio []float64) (corrs [payloadBits]float64, best
 		// Not enough data for a full watermark cycle — use what we have
 	}
 
-	// Compute STFT magnitudes (dB) for all frames
+	// Compute STFT magnitudes (dB) for all frames + PAFM masks
 	type stftFrame struct {
 		magDB [FFTSize / 2]float64
+		mask  [NumBins]bool // PAFM: which bins are audible
 	}
 	frames := make([]stftFrame, nFrames)
 
@@ -306,8 +355,11 @@ func (d *STFTDetector) Detect(audio []float64) (corrs [payloadBits]float64, best
 			frames[f].magDB[bin] = 20 * math.Log10(mag)
 		}
 
-		// Cepstrum filtering: remove spectral envelope
-		// DCT of dB magnitudes, zero first N_ceps coefficients, IDCT
+		// PAFM mask: computed on ORIGINAL magnitudes (before cepstrum filtering)
+		// so the mask reflects the true spectral shape for masking decisions.
+		frames[f].mask = PafmMask(frames[f].magDB[:])
+
+		// Cepstrum filtering: remove spectral envelope (after mask computation)
 		cepstrumFilter(frames[f].magDB[:], 8)
 	}
 
@@ -332,6 +384,9 @@ func (d *STFTDetector) Detect(audio []float64) (corrs [payloadBits]float64, best
 
 			var corr float64
 			for b := 0; b < NumBins; b++ {
+				if !frames[f].mask[b] {
+					continue // PAFM: skip bins in spectral valleys
+				}
 				bin := BinLow + b
 				corr += frames[f].magDB[bin] * float64(d.pnChips[g][b])
 			}