diff --git a/src-tauri/src/lib.rs b/src-tauri/src/lib.rs
index 6897a89..5e6a5a6 100644
--- a/src-tauri/src/lib.rs
+++ b/src-tauri/src/lib.rs
@@ -122,6 +122,25 @@ pub fn run() {
                     "check_updates" => {
                         let _ = app.emit("check-for-updates", ());
                     }
+                    "cancel_listening" => {
+                        use crate::utils::{change_tray_icon, TrayIconState};
+                        use crate::managers::audio::AudioRecordingManager;
+                        use std::sync::Arc;
+                        
+                        // Cancel the recording without transcribing
+                        let rm = app.state::<Arc<AudioRecordingManager>>();
+                        rm.cancel_recording();
+                        
+                        // Return to idle state
+                        change_tray_icon(app, TrayIconState::Idle);
+                    }
+                    "cancel_transcribing" => {
+                        use crate::utils::{change_tray_icon, TrayIconState};
+                        
+                        // For now, just return to idle state
+                        // TODO: In a future version, we could add actual request cancellation
+                        change_tray_icon(app, TrayIconState::Idle);
+                    }
                     "quit" => {
                         app.exit(0);
                     }
diff --git a/src-tauri/src/managers/audio.rs b/src-tauri/src/managers/audio.rs
index e5c8994..0988aff 100644
--- a/src-tauri/src/managers/audio.rs
+++ b/src-tauri/src/managers/audio.rs
@@ -258,4 +258,25 @@ impl AudioRecordingManager {
             _ => None,
         }
     }
+
+    /// Cancel any ongoing recording without returning audio samples
+    pub fn cancel_recording(&self) {
+        let mut state = self.state.lock().unwrap();
+
+        if let RecordingState::Recording { .. } = *state {
+            *state = RecordingState::Idle;
+            drop(state);
+
+            if let Some(rec) = self.recorder.lock().unwrap().as_ref() {
+                let _ = rec.stop(); // Discard the result
+            }
+
+            *self.is_recording.lock().unwrap() = false;
+
+            // In on-demand mode turn the mic off again
+            if matches!(*self.mode.lock().unwrap(), MicrophoneMode::OnDemand) {
+                self.stop_microphone_stream();
+            }
+        }
+    }
 }
diff --git a/src-tauri/src/utils.rs b/src-tauri/src/utils.rs
index be67035..89b6822 100644
--- a/src-tauri/src/utils.rs
+++ b/src-tauri/src/utils.rs
@@ -14,6 +14,7 @@ use tauri::image::Image;
 use tauri::tray::TrayIcon;
 use tauri::AppHandle;
 use tauri::Manager;
+use tauri::menu::{Menu, MenuItem, PredefinedMenuItem};
 use tauri_plugin_clipboard_manager::ClipboardExt;
 
 fn send_paste() -> Result<(), String> {
@@ -70,6 +71,7 @@ pub fn paste(text: String, app_handle: AppHandle) -> Result<(), String> {
     Ok(())
 }
 
+#[derive(Clone, Debug, PartialEq)]
 pub enum TrayIconState {
     Idle,
     Recording,
@@ -93,6 +95,72 @@ pub fn change_tray_icon(app: &AppHandle, icon: TrayIconState) {
         )
         .expect("failed to set icon"),
     ));
+
+    // Update menu based on state
+    update_tray_menu(app, &icon);
+}
+
+pub fn update_tray_menu(app: &AppHandle, state: &TrayIconState) {
+    let version = env!("CARGO_PKG_VERSION");
+    let version_label = format!("Handy v{}", version);
+
+    // Platform-specific accelerators
+    #[cfg(target_os = "macos")]
+    let settings_accelerator = Some("Cmd+,");
+    #[cfg(not(target_os = "macos"))]
+    let settings_accelerator = Some("Ctrl+,");
+
+    #[cfg(target_os = "macos")]
+    let quit_accelerator = Some("Cmd+Q");
+    #[cfg(not(target_os = "macos"))]
+    let quit_accelerator = Some("Ctrl+Q");
+
+    let version_i = MenuItem::with_id(app, "version", &version_label, false, None::<&str>).expect("failed to create version item");
+    let settings_i = MenuItem::with_id(app, "settings", "Settings...", true, settings_accelerator).expect("failed to create settings item");
+    let check_updates_i = MenuItem::with_id(app, "check_updates", "Check for Updates...", true, None::<&str>).expect("failed to create check updates item");
+    let quit_i = MenuItem::with_id(app, "quit", "Quit", true, quit_accelerator).expect("failed to create quit item");
+
+    let menu = match state {
+        TrayIconState::Recording => {
+            let cancel_i = MenuItem::with_id(app, "cancel_listening", "Cancel Listening", true, None::<&str>).expect("failed to create cancel listening item");
+            Menu::with_items(app, &[
+                &version_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &cancel_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &settings_i,
+                &check_updates_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &quit_i,
+            ]).expect("failed to create menu")
+        }
+        TrayIconState::Transcribing => {
+            let cancel_i = MenuItem::with_id(app, "cancel_transcribing", "Cancel Transcribing", true, None::<&str>).expect("failed to create cancel transcribing item");
+            Menu::with_items(app, &[
+                &version_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &cancel_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &settings_i,
+                &check_updates_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &quit_i,
+            ]).expect("failed to create menu")
+        }
+        TrayIconState::Idle => {
+            Menu::with_items(app, &[
+                &version_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &settings_i,
+                &check_updates_i,
+                &PredefinedMenuItem::separator(app).expect("failed to create separator"),
+                &quit_i,
+            ]).expect("failed to create menu")
+        }
+    };
+
+    let tray = app.state::<TrayIcon>();
+    let _ = tray.set_menu(Some(menu));
 }
 
 /// Plays an audio resource from the resources directory.