diff --git a/browser/ui/webui/ai_chat/ai_chat_ui_page_handler.cc b/browser/ui/webui/ai_chat/ai_chat_ui_page_handler.cc
index 27d63d4d7012..aedd32563d60 100644
--- a/browser/ui/webui/ai_chat/ai_chat_ui_page_handler.cc
+++ b/browser/ui/webui/ai_chat/ai_chat_ui_page_handler.cc
@@ -108,15 +108,12 @@ void AIChatUIPageHandler::GetModels(GetModelsCallback callback) {
     return;
   }
 
-  std::vector<mojom::ModelPtr> models(kAllModelKeysDisplayOrder.size());
+  auto all_models = GetAllModels();
+  std::vector<mojom::ModelPtr> models(all_models.size());
   // Ensure we return only in intended display order
-  std::transform(kAllModelKeysDisplayOrder.cbegin(),
-                 kAllModelKeysDisplayOrder.cend(), models.begin(),
-                 [](auto& model_key) {
-                   auto model_match = kAllModels.find(model_key);
-                   DCHECK(model_match != kAllModels.end());
-                   return model_match->second.Clone();
-                 });
+  std::transform(all_models.cbegin(), all_models.cend(), models.begin(),
+                 [](auto& model) { return model.Clone(); });
+
   std::move(callback).Run(std::move(models),
                           active_chat_tab_helper_->GetCurrentModel().key);
 }
diff --git a/browser/ui/webui/settings/brave_settings_leo_assistant_handler.cc b/browser/ui/webui/settings/brave_settings_leo_assistant_handler.cc
index fa1725c5f9e7..e3f95a4f771d 100644
--- a/browser/ui/webui/settings/brave_settings_leo_assistant_handler.cc
+++ b/browser/ui/webui/settings/brave_settings_leo_assistant_handler.cc
@@ -147,26 +147,18 @@ void BraveLeoAssistantHandler::HandleResetLeoData(
 }
 
 void BraveLeoAssistantHandler::HandleGetModels(const base::Value::List& args) {
-  std::vector<ai_chat::mojom::ModelPtr> models(
-      ai_chat::kAllModelKeysDisplayOrder.size());
-  // Ensure we return only in intended display order
-  std::transform(ai_chat::kAllModelKeysDisplayOrder.cbegin(),
-                 ai_chat::kAllModelKeysDisplayOrder.cend(), models.begin(),
-                 [](auto& model_key) {
-                   auto model_match = ai_chat::kAllModels.find(model_key);
-                   DCHECK(model_match != ai_chat::kAllModels.end());
-                   return model_match->second.Clone();
-                 });
+  auto& models = ai_chat::GetAllModels();
   base::Value::List models_list;
   for (auto& model : models) {
     base::Value::Dict dict;
-    dict.Set("key", model->key);
-    dict.Set("name", model->name);
-    dict.Set("display_name", model->display_name);
-    dict.Set("display_maker", model->display_maker);
-    dict.Set("engine_type", static_cast<int>(model->engine_type));
-    dict.Set("category", static_cast<int>(model->category));
-    dict.Set("is_premium", model->is_premium);
+    dict.Set("key", model.key);
+    dict.Set("name", model.name);
+    dict.Set("display_name", model.display_name);
+    dict.Set("display_maker", model.display_maker);
+    dict.Set("engine_type", static_cast<int>(model.engine_type));
+    dict.Set("category", static_cast<int>(model.category));
+    dict.Set("is_premium",
+             model.access == ai_chat::mojom::ModelAccess::PREMIUM);
     models_list.Append(std::move(dict));
   }
 
diff --git a/browser/ui/webui/settings/brave_settings_localized_strings_provider.cc b/browser/ui/webui/settings/brave_settings_localized_strings_provider.cc
index e6c7d47b1ac5..48e7714be22e 100644
--- a/browser/ui/webui/settings/brave_settings_localized_strings_provider.cc
+++ b/browser/ui/webui/settings/brave_settings_localized_strings_provider.cc
@@ -394,7 +394,7 @@ void BraveAddCommonStrings(content::WebUIDataSource* html_source,
     {"braveLeoAssistantModelSelectionLabel",
      IDS_SETTINGS_LEO_ASSISTANT_MODEL_SELECTION_LABEL},
     {"braveLeoModelCategory-chat", IDS_CHAT_UI_MODEL_CATEGORY_CHAT},
-    {"braveLeoModelSubtitle-chat-default", IDS_CHAT_UI_CHAT_DEFAULT_SUBTITLE},
+    {"braveLeoModelSubtitle-chat-basic", IDS_CHAT_UI_CHAT_BASIC_SUBTITLE},
     {"braveLeoModelSubtitle-chat-leo-expanded",
      IDS_CHAT_UI_CHAT_LEO_EXPANDED_SUBTITLE},
     {"braveLeoModelSubtitle-chat-claude-instant",
diff --git a/components/ai_chat/core/browser/constants.cc b/components/ai_chat/core/browser/constants.cc
index 6530173542d2..d0f897fae03e 100644
--- a/components/ai_chat/core/browser/constants.cc
+++ b/components/ai_chat/core/browser/constants.cc
@@ -23,12 +23,15 @@ base::span<const webui::LocalizedString> GetLocalizedStrings() {
       {"errorNetworkLabel", IDS_CHAT_UI_ERROR_NETWORK},
       {"errorRateLimit", IDS_CHAT_UI_ERROR_RATE_LIMIT},
       {"retryButtonLabel", IDS_CHAT_UI_RETRY_BUTTON_LABEL},
-      {"introMessage-chat-default", IDS_CHAT_UI_INTRO_MESSAGE_CHAT_DEFAULT},
+      {"introMessage-chat-basic", IDS_CHAT_UI_INTRO_MESSAGE_CHAT_BASIC},
       {"introMessage-chat-leo-expanded",
        IDS_CHAT_UI_INTRO_MESSAGE_CHAT_LEO_EXPANDED},
       {"introMessage-chat-claude-instant",
        IDS_CHAT_UI_INTRO_MESSAGE_CHAT_LEO_CLAUDE_INSTANT},
       {"modelNameSyntax", IDS_CHAT_UI_MODEL_NAME_SYNTAX},
+      {"modelFreemiumLabelNonPremium",
+       IDS_CHAT_UI_MODEL_FREEMIUM_LABEL_NON_PREMIUM},
+      {"modelFreemiumLabelPremium", IDS_CHAT_UI_MODEL_FREEMIUM_LABEL_PREMIUM},
       {"modelCategory-chat", IDS_CHAT_UI_MODEL_CATEGORY_CHAT},
       {"menuNewChat", IDS_CHAT_UI_MENU_NEW_CHAT},
       {"menuGoPremium", IDS_CHAT_UI_MENU_GO_PREMIUM},
@@ -44,8 +47,8 @@ base::span<const webui::LocalizedString> GetLocalizedStrings() {
       {"premiumFeature_2", IDS_CHAT_UI_PREMIUM_FEATURE_2},
       {"premiumLabel", IDS_CHAT_UI_PREMIUM_LABEL},
       {"premiumPricing", IDS_CHAT_UI_PREMIUM_PRICING},
-      {"switchToDefaultModelButtonLabel",
-       IDS_CHAT_UI_SWITCH_TO_DEFAULT_MODEL_BUTTON_LABEL},
+      {"switchToBasicModelButtonLabel",
+       IDS_CHAT_UI_SWITCH_TO_BASIC_MODEL_BUTTON_LABEL},
       {"dismissButtonLabel", IDS_CHAT_UI_DISMISS_BUTTON_LABEL},
       {"unlockPremiumTitle", IDS_CHAT_UI_UNLOCK_PREMIUM_TITLE},
       {"premiumFeature_1_desc", IDS_CHAT_UI_PREMIUM_FEATURE_1_DESC},
@@ -74,7 +77,7 @@ base::span<const webui::LocalizedString> GetLocalizedStrings() {
       {"optionOther", IDS_CHAT_UI_OPTION_OTHER},
       {"feedbackError", IDS_CHAT_UI_FEEDBACK_SUBMIT_ERROR},
       {"ratingError", IDS_CHAT_UI_RATING_ERROR},
-      {"braveLeoModelSubtitle-chat-default", IDS_CHAT_UI_CHAT_DEFAULT_SUBTITLE},
+      {"braveLeoModelSubtitle-chat-basic", IDS_CHAT_UI_CHAT_BASIC_SUBTITLE},
       {"braveLeoModelSubtitle-chat-leo-expanded",
        IDS_CHAT_UI_CHAT_LEO_EXPANDED_SUBTITLE},
       {"braveLeoModelSubtitle-chat-claude-instant",
diff --git a/components/ai_chat/core/browser/conversation_driver.cc b/components/ai_chat/core/browser/conversation_driver.cc
index bdb3fbe01d4b..e51f6793f9f0 100644
--- a/components/ai_chat/core/browser/conversation_driver.cc
+++ b/components/ai_chat/core/browser/conversation_driver.cc
@@ -59,15 +59,18 @@ ConversationDriver::ConversationDriver(raw_ptr<PrefService> pref_service,
       base::BindRepeating(&ConversationDriver::OnUserOptedIn,
                           weak_ptr_factory_.GetWeakPtr()));
 
-  // Engines and model names are selectable per conversation, not static.
-  // Start with default from pref value but only if user set. We can't rely on
-  // actual default pref value since we should vary if user is premium or not.
+  // Model choice names is selectable per conversation, not global.
+  // Start with default from pref value if. If user is premium and premium model
+  // is different to non-premium default, and user hasn't customized the model
+  // pref, then switch the user to the premium default.
   // TODO(petemill): When we have an event for premium status changed, and a
   // profile service for AIChat, then we can call
   // |pref_service_->SetDefaultPrefValue| when the user becomes premium. With
   // that, we'll be able to simply call GetString(prefs::kDefaultModelKey) and
-  // not vary on premium status.
-  if (!pref_service_->GetUserPrefValue(prefs::kDefaultModelKey)) {
+  // not have to fetch premium status.
+  if (!pref_service_->GetUserPrefValue(prefs::kDefaultModelKey) &&
+      features::kAIModelsPremiumDefaultKey.Get() !=
+          features::kAIModelsDefaultKey.Get()) {
     credential_manager_->GetPremiumStatus(base::BindOnce(
         [](ConversationDriver* instance, mojom::PremiumStatus status) {
           instance->last_premium_status_ = status;
@@ -76,7 +79,7 @@ ConversationDriver::ConversationDriver(raw_ptr<PrefService> pref_service,
             return;
           }
           // Use default premium model for this instance
-          instance->ChangeModel(kModelsPremiumDefaultKey);
+          instance->ChangeModel(features::kAIModelsPremiumDefaultKey.Get());
           // Make sure default model reflects premium status
           const auto* current_default =
               instance->pref_service_
@@ -84,10 +87,10 @@ ConversationDriver::ConversationDriver(raw_ptr<PrefService> pref_service,
                   ->GetIfString();
 
           if (current_default &&
-              *current_default != kModelsPremiumDefaultKey) {
+              *current_default != features::kAIModelsPremiumDefaultKey.Get()) {
             instance->pref_service_->SetDefaultPrefValue(
                 prefs::kDefaultModelKey,
-                    base::Value(kModelsPremiumDefaultKey));
+                base::Value(features::kAIModelsPremiumDefaultKey.Get()));
           }
         },
         // Unretained is ok as credential manager is owned by this class,
@@ -118,16 +121,19 @@ ConversationDriver::~ConversationDriver() = default;
 void ConversationDriver::ChangeModel(const std::string& model_key) {
   DCHECK(!model_key.empty());
   // Check that the key exists
-  if (kAllModels.find(model_key) == kAllModels.end()) {
+  auto* new_model = GetModel(model_key);
+  if (!new_model) {
     NOTREACHED() << "No matching model found for key: " << model_key;
     return;
   }
-  model_key_ = model_key;
+  model_key_ = new_model->key;
   InitEngine();
 }
 
 const mojom::Model& ConversationDriver::GetCurrentModel() {
-  return kAllModels.find(model_key_)->second;
+  auto* model = GetModel(model_key_);
+  DCHECK(model);
+  return *model;
 }
 
 const std::vector<ConversationTurn>& ConversationDriver::GetConversationHistory() {
@@ -145,33 +151,32 @@ void ConversationDriver::OnConversationActiveChanged(bool is_conversation_active
 
 void ConversationDriver::InitEngine() {
   DCHECK(!model_key_.empty());
-  auto model_match = kAllModels.find(model_key_);
+  auto* model = GetModel(model_key_);
   // Make sure we get a valid model, defaulting to static default or first.
-  if (model_match == kAllModels.end()) {
+  if (!model) {
     NOTREACHED() << "Model was not part of static model list";
     // Use default
-    model_match = kAllModels.find(kModelsDefaultKey);
-    const auto is_found = model_match != kAllModels.end();
-    DCHECK(is_found);
-    if (!is_found) {
-      model_match = kAllModels.begin();
+    model = GetModel(features::kAIModelsDefaultKey.Get());
+    DCHECK(model);
+    if (!model) {
+      // Use first if given bad default value
+      model = &GetAllModels().at(0);
     }
   }
 
-  auto model = model_match->second;
   // Model's key might not be the same as what we asked for (e.g. if the model
   // no longer exists).
-  model_key_ = model.key;
+  model_key_ = model->key;
 
   // Engine enum on model to decide which one
-  if (model.engine_type == mojom::ModelEngineType::LLAMA_REMOTE) {
+  if (model->engine_type == mojom::ModelEngineType::LLAMA_REMOTE) {
     VLOG(1) << "Started AI engine: llama";
     engine_ = std::make_unique<EngineConsumerLlamaRemote>(
-        model, url_loader_factory_, credential_manager_.get());
+        *model, url_loader_factory_, credential_manager_.get());
   } else {
     VLOG(1) << "Started AI engine: claude";
     engine_ = std::make_unique<EngineConsumerClaudeRemote>(
-        model, url_loader_factory_, credential_manager_.get());
+        *model, url_loader_factory_, credential_manager_.get());
   }
 
   // Pending requests have been deleted along with the model engine
@@ -719,7 +724,7 @@ void ConversationDriver::OnPremiumStatusReceived(
   if (last_premium_status_ != premium_status &&
       premium_status == mojom::PremiumStatus::Active) {
     // Change model if we haven't already
-    ChangeModel(kModelsPremiumDefaultKey);
+    ChangeModel(features::kAIModelsPremiumDefaultKey.Get());
   }
   last_premium_status_ = premium_status;
   std::move(parent_callback).Run(premium_status);
diff --git a/components/ai_chat/core/browser/engine/engine_consumer_claude.cc b/components/ai_chat/core/browser/engine/engine_consumer_claude.cc
index 6b92ed5f8a7c..99faf2fe5fdd 100644
--- a/components/ai_chat/core/browser/engine/engine_consumer_claude.cc
+++ b/components/ai_chat/core/browser/engine/engine_consumer_claude.cc
@@ -125,18 +125,11 @@ EngineConsumerClaudeRemote::EngineConsumerClaudeRemote(
     const mojom::Model& model,
     scoped_refptr<network::SharedURLLoaderFactory> url_loader_factory,
     AIChatCredentialManager* credential_manager) {
-  // Allow specific model name to be overriden by feature flag
-  // TODO(petemill): verify premium status, or ensure server will verify even
-  // when given a model name override via cli flag param.
-  std::string model_name = ai_chat::features::kAIModelName.Get();
-  if (model_name.empty()) {
-    model_name = model.name;
-  }
-  DCHECK(!model_name.empty());
+  DCHECK(!model.name.empty());
   base::flat_set<std::string_view> stop_sequences(kStopSequences.begin(),
                                                   kStopSequences.end());
   api_ = std::make_unique<RemoteCompletionClient>(
-      model_name, stop_sequences, url_loader_factory, credential_manager);
+      model.name, stop_sequences, url_loader_factory, credential_manager);
 
   max_page_content_length_ = model.max_page_content_length;
 }
diff --git a/components/ai_chat/core/browser/engine/engine_consumer_llama.cc b/components/ai_chat/core/browser/engine/engine_consumer_llama.cc
index d489c801b8c4..d1805cf5ff9e 100644
--- a/components/ai_chat/core/browser/engine/engine_consumer_llama.cc
+++ b/components/ai_chat/core/browser/engine/engine_consumer_llama.cc
@@ -243,18 +243,11 @@ EngineConsumerLlamaRemote::EngineConsumerLlamaRemote(
     const mojom::Model& model,
     scoped_refptr<network::SharedURLLoaderFactory> url_loader_factory,
     AIChatCredentialManager* credential_manager) {
-  // Allow specific model name to be overriden by feature flag
-  // TODO(petemill): verify premium status, or ensure server will verify even
-  // when given a model name override via cli flag param.
-  std::string model_name = ai_chat::features::kAIModelName.Get();
-  if (model_name.empty()) {
-    model_name = model.name;
-  }
-  DCHECK(!model_name.empty());
+  DCHECK(!model.name.empty());
   base::flat_set<std::string_view> stop_sequences(kStopSequences.begin(),
                                                   kStopSequences.end());
   api_ = std::make_unique<RemoteCompletionClient>(
-      model_name, stop_sequences, url_loader_factory, credential_manager);
+      model.name, stop_sequences, url_loader_factory, credential_manager);
 
   max_page_content_length_ = model.max_page_content_length;
 }
diff --git a/components/ai_chat/core/browser/models.cc b/components/ai_chat/core/browser/models.cc
index 0de03d5460fd..fa84fb272c14 100644
--- a/components/ai_chat/core/browser/models.cc
+++ b/components/ai_chat/core/browser/models.cc
@@ -7,6 +7,8 @@
 
 #include "brave/components/ai_chat/core/browser/models.h"
 
+#include "base/no_destructor.h"
+#include "brave/components/ai_chat/core/common/features.h"
 #include "brave/components/ai_chat/core/common/mojom/ai_chat.mojom.h"
 
 namespace ai_chat {
@@ -14,7 +16,8 @@ namespace ai_chat {
 // When adding new models, especially for display, make sure to add the UI
 // strings to ai_chat_ui_strings.grdp and ai_chat/core/constants.cc.
 // This also applies for modifying keys, since some of the strings are based
-// on the model key.
+// on the model key. Also be sure to migrate prefs if changing or removing
+// keys.
 
 // Llama2 Token Allocation:
 // - Llama2 has a context limit: tokens + max_new_tokens <= 4096
@@ -32,25 +35,33 @@ namespace ai_chat {
 // - Reserverd for page content: 100k / 2 = 50k tokens
 // - Long conversation warning threshold: 100k * 0.80 = 80k tokens
 
-const base::flat_map<std::string_view, mojom::Model> kAllModels = {
-    {"chat-default",
-     {"chat-default", "llama-2-13b-chat", "llama2 13b", "Meta",
-      mojom::ModelEngineType::LLAMA_REMOTE, mojom::ModelCategory::CHAT, false,
-      9000, 9700}},
-    {"chat-leo-expanded",
-     {"chat-leo-expanded", "llama-2-70b-chat", "llama2 70b", "Meta",
-      mojom::ModelEngineType::LLAMA_REMOTE, mojom::ModelCategory::CHAT, true,
-      9000, 9700}},
-    {"chat-claude-instant",
-     {"chat-claude-instant", "claude-instant-v1", "Claude Instant", "Anthropic",
-      mojom::ModelEngineType::CLAUDE_REMOTE, mojom::ModelCategory::CHAT, true,
-      200000, 320000}},
-};
-
-const std::vector<std::string_view> kAllModelKeysDisplayOrder = {
-    "chat-default",
-    "chat-leo-expanded",
-    "chat-claude-instant",
-};
+const std::vector<ai_chat::mojom::Model>& GetAllModels() {
+  static const auto kFreemiumAccess =
+      features::kFreemiumAvailable.Get() ? mojom::ModelAccess::BASIC_AND_PREMIUM
+                                         : mojom::ModelAccess::PREMIUM;
+  static const base::NoDestructor<std::vector<mojom::Model>> kModels({
+      {"chat-leo-expanded", "mixtral-8x7b-instruct", "Mixtral", "Mistral AI",
+       mojom::ModelEngineType::LLAMA_REMOTE, mojom::ModelCategory::CHAT,
+       kFreemiumAccess, 9000, 9700},
+      {"chat-claude-instant", "claude-instant-v1", "Claude Instant",
+       "Anthropic", mojom::ModelEngineType::CLAUDE_REMOTE,
+       mojom::ModelCategory::CHAT, kFreemiumAccess, 180000, 320000},
+      {"chat-basic", "llama-2-13b-chat", "llama2 13b", "Meta",
+       mojom::ModelEngineType::LLAMA_REMOTE, mojom::ModelCategory::CHAT,
+       mojom::ModelAccess::BASIC, 9000, 9700},
+  });
+  return *kModels;
+}
+
+const ai_chat::mojom::Model* GetModel(std::string_view key) {
+  auto& models = GetAllModels();
+  auto match = std::find_if(
+      models.cbegin(), models.cend(),
+      [&key](const mojom::Model& item) { return item.key == key; });
+  if (match != models.cend()) {
+    return &*match;
+  }
+  return nullptr;
+}
 
 }  // namespace ai_chat
diff --git a/components/ai_chat/core/browser/models.h b/components/ai_chat/core/browser/models.h
index 9492e6dfb6d7..5fd32e10704c 100644
--- a/components/ai_chat/core/browser/models.h
+++ b/components/ai_chat/core/browser/models.h
@@ -6,20 +6,22 @@
 #ifndef BRAVE_COMPONENTS_AI_CHAT_CORE_BROWSER_MODELS_H_
 #define BRAVE_COMPONENTS_AI_CHAT_CORE_BROWSER_MODELS_H_
 
+#include <string_view>
 #include <vector>
 
 #include "base/containers/flat_map.h"
+#include "brave/components/ai_chat/core/common/features.h"
 #include "brave/components/ai_chat/core/common/mojom/ai_chat.mojom-forward.h"
 
 namespace ai_chat {
 
-inline constexpr char kModelsDefaultKey[] = "chat-default";
-inline constexpr char kModelsPremiumDefaultKey[] = "chat-claude-instant";
+// All models that the user can choose for chat conversations, in UI display
+// order.
+extern const std::vector<ai_chat::mojom::Model>& GetAllModels();
 
-// All models that the user can choose for chat conversations.
-extern const base::flat_map<std::string_view, mojom::Model> kAllModels;
-// UI display order for models
-extern const std::vector<std::string_view> kAllModelKeysDisplayOrder;
+// Get model by key. If there is no matching model for the key, NULL is
+// returned.
+extern const ai_chat::mojom::Model* GetModel(std::string_view key);
 
 }  // namespace ai_chat
 
diff --git a/components/ai_chat/core/common/BUILD.gn b/components/ai_chat/core/common/BUILD.gn
index e1080ea7705a..1a3d36a5cb29 100644
--- a/components/ai_chat/core/common/BUILD.gn
+++ b/components/ai_chat/core/common/BUILD.gn
@@ -21,3 +21,18 @@ static_library("common") {
     "//components/prefs",
   ]
 }
+
+if (!is_ios) {
+  source_set("unit_tests") {
+    testonly = true
+    sources = [ "pref_names_unittest.cc" ]
+
+    deps = [
+      "//base/test:test_support",
+      "//brave/components/ai_chat/core/common",
+      "//components/prefs:test_support",
+      "//content/test:test_support",
+      "//testing/gtest:gtest",
+    ]
+  }
+}
diff --git a/components/ai_chat/core/common/features.cc b/components/ai_chat/core/common/features.cc
index 251762a41635..4ef9a4f8a275 100644
--- a/components/ai_chat/core/common/features.cc
+++ b/components/ai_chat/core/common/features.cc
@@ -21,8 +21,13 @@ BASE_FEATURE(kAIChat,
              base::FEATURE_DISABLED_BY_DEFAULT
 #endif
 );
-const base::FeatureParam<std::string> kAIModelName{&kAIChat, "ai_model_name",
-                                                   ""};
+const base::FeatureParam<std::string> kAIModelsDefaultKey{
+    &kAIChat, "default_model", "chat-leo-expanded"};
+const base::FeatureParam<std::string> kAIModelsPremiumDefaultKey{
+    &kAIChat, "default_premium_model", "chat-leo-expanded"};
+const base::FeatureParam<bool> kFreemiumAvailable(&kAIChat,
+                                                  "is_freemium_available",
+                                                  true);
 const base::FeatureParam<bool> kAIChatSSE{&kAIChat, "ai_chat_sse", true};
 const base::FeatureParam<double> kAITemperature{&kAIChat, "temperature", 0.2};
 
diff --git a/components/ai_chat/core/common/features.h b/components/ai_chat/core/common/features.h
index 29bf90b9b8d3..3a03dc3e725c 100644
--- a/components/ai_chat/core/common/features.h
+++ b/components/ai_chat/core/common/features.h
@@ -14,7 +14,13 @@
 namespace ai_chat::features {
 
 BASE_DECLARE_FEATURE(kAIChat);
-extern const base::FeatureParam<std::string> kAIModelName;
+extern const base::FeatureParam<std::string> kAIModelsDefaultKey;
+extern const base::FeatureParam<std::string> kAIModelsPremiumDefaultKey;
+
+// If true, certain freemium models are available to non-premium users. If
+// false, those models are premium-only.
+extern const base::FeatureParam<bool> kFreemiumAvailable;
+
 extern const base::FeatureParam<bool> kAIChatSSE;
 extern const base::FeatureParam<double> kAITemperature;
 
diff --git a/components/ai_chat/core/common/mojom/ai_chat.mojom b/components/ai_chat/core/common/mojom/ai_chat.mojom
index cbeb9a96e651..52eb5147e22e 100644
--- a/components/ai_chat/core/common/mojom/ai_chat.mojom
+++ b/components/ai_chat/core/common/mojom/ai_chat.mojom
@@ -35,6 +35,15 @@ enum ModelCategory {
   CHAT,
 };
 
+enum ModelAccess {
+  // The model only has a single basic tier, accessible by any level
+  BASIC,
+  // The model has a basic tier and a more capable premium tier (a.k.a freemium)
+  BASIC_AND_PREMIUM,
+  // The model only has a premium tier
+  PREMIUM,
+};
+
 enum PremiumStatus {
   Inactive,
   Active,
@@ -86,7 +95,8 @@ struct Model {
   ModelEngineType engine_type;
   // user-facing category
   ModelCategory category;
-  bool is_premium;
+  // Which access level grants permission to use the model
+  ModelAccess access;
   // max limit to truncate page contents (measured in chars, not tokens)
   uint32 max_page_content_length;
   // max limit for overall conversation (measured in chars, not tokens)
diff --git a/components/ai_chat/core/common/pref_names.cc b/components/ai_chat/core/common/pref_names.cc
index e67b052dc98c..847ed825881a 100644
--- a/components/ai_chat/core/common/pref_names.cc
+++ b/components/ai_chat/core/common/pref_names.cc
@@ -5,6 +5,10 @@
 
 #include "brave/components/ai_chat/core/common/pref_names.h"
 
+#include <string>
+
+#include "base/strings/string_util.h"
+#include "brave/components/ai_chat/core/common/features.h"
 #include "components/prefs/pref_registry_simple.h"
 #include "components/prefs/pref_service.h"
 
@@ -21,7 +25,8 @@ void RegisterProfilePrefs(PrefRegistrySimple* registry) {
   registry->RegisterTimePref(kLastAcceptedDisclaimer, {});
   registry->RegisterBooleanPref(kBraveChatAutocompleteProviderEnabled, true);
   registry->RegisterBooleanPref(kUserDismissedPremiumPrompt, false);
-  registry->RegisterStringPref(kDefaultModelKey, "chat-default");
+  registry->RegisterStringPref(kDefaultModelKey,
+                               features::kAIModelsDefaultKey.Get());
 }
 
 void RegisterProfilePrefsForMigration(PrefRegistrySimple* registry) {
@@ -30,6 +35,16 @@ void RegisterProfilePrefsForMigration(PrefRegistrySimple* registry) {
 
 void MigrateProfilePrefs(PrefService* profile_prefs) {
   profile_prefs->ClearPref(kObseleteBraveChatAutoGenerateQuestions);
+  // migrate model key from "chat-default" to "chat-basic"
+  static const std::string kDefaultModelBasicFrom = "chat-default";
+  static const std::string kDefaultModelBasicTo = "chat-basic";
+  if (auto* default_model_value =
+          profile_prefs->GetUserPrefValue(kDefaultModelKey)) {
+    if (base::EqualsCaseInsensitiveASCII(default_model_value->GetString(),
+                                         kDefaultModelBasicFrom)) {
+      profile_prefs->SetString(kDefaultModelKey, kDefaultModelBasicTo);
+    }
+  }
 }
 
 void RegisterLocalStatePrefs(PrefRegistrySimple* registry) {
diff --git a/components/ai_chat/core/common/pref_names_unittest.cc b/components/ai_chat/core/common/pref_names_unittest.cc
new file mode 100644
index 000000000000..bcdcc236210e
--- /dev/null
+++ b/components/ai_chat/core/common/pref_names_unittest.cc
@@ -0,0 +1,33 @@
+// Copyright (c) 2024 The Brave Authors. All rights reserved.
+// This Source Code Form is subject to the terms of the Mozilla Public
+// License, v. 2.0. If a copy of the MPL was not distributed with this file,
+// You can obtain one at https://mozilla.org/MPL/2.0/.
+
+#include "brave/components/ai_chat/core/common/pref_names.h"
+
+#include <string>
+
+#include "components/prefs/testing_pref_service.h"
+#include "testing/gtest/include/gtest/gtest.h"
+
+namespace ai_chat::prefs {
+
+class AIChatPrefMigrationTest : public ::testing::Test {
+ public:
+  void SetUp() override {
+    RegisterProfilePrefs(pref_service_.registry());
+    RegisterProfilePrefsForMigration(pref_service_.registry());
+  }
+
+  TestingPrefServiceSimple pref_service_;
+};
+
+TEST_F(AIChatPrefMigrationTest, ChangeOldDefaultKey) {
+  pref_service_.SetString(kDefaultModelKey, "chat-default");
+  MigrateProfilePrefs(&pref_service_);
+
+  EXPECT_EQ(pref_service_.GetUserPrefValue(kDefaultModelKey)->GetString(),
+            "chat-basic");
+}
+
+}  // namespace ai_chat::prefs
diff --git a/components/ai_chat/resources/page/components/alerts/error_rate_limit.tsx b/components/ai_chat/resources/page/components/alerts/error_rate_limit.tsx
index af2b83631d23..0071a25bd5c3 100644
--- a/components/ai_chat/resources/page/components/alerts/error_rate_limit.tsx
+++ b/components/ai_chat/resources/page/components/alerts/error_rate_limit.tsx
@@ -7,24 +7,37 @@ import * as React from 'react'
 import { getLocale } from '$web-common/locale'
 import Alert from '@brave/leo/react/alert'
 import Button from '@brave/leo/react/button'
+import getPageHandlerInstance, * as mojom from '../../api/page_handler'
 import DataContext from '../../state/context'
 import PremiumSuggestion from '../premium_suggestion'
 import styles from './alerts.module.scss'
 
-interface ErrorRateLimit {
-  onRetry?: () => void
-}
 
-function ErrorRateLimit(props: ErrorRateLimit) {
-  const { isPremiumUser } = React.useContext(DataContext)
+function ErrorRateLimit() {
+  const context = React.useContext(DataContext)
 
-  if (!isPremiumUser) {
+  if (!context.isPremiumUser) {
+    // Freemium model with non-premium user has stricter rate limits. Secondary
+    // action is to switch to completely free model.
+    if (context.currentModel?.access === mojom.ModelAccess.BASIC_AND_PREMIUM) {
+      return (
+        <PremiumSuggestion
+          title={getLocale('rateLimitReachedTitle')}
+          description={getLocale('rateLimitReachedDesc')}
+          secondaryActionButton={
+            <Button kind='plain-faint' onClick={context.switchToBasicModel}>
+              {getLocale('switchToBasicModelButtonLabel')}
+            </Button>
+          }
+        />
+      )
+    }
     return (
       <PremiumSuggestion
         title={getLocale('rateLimitReachedTitle')}
         description={getLocale('rateLimitReachedDesc')}
         secondaryActionButton={
-          <Button kind='plain-faint' onClick={props.onRetry}>
+          <Button kind='plain-faint' onClick={() => getPageHandlerInstance().pageHandler.retryAPIRequest()}>
             {getLocale('retryButtonLabel')}
           </Button>
         }
@@ -42,7 +55,7 @@ function ErrorRateLimit(props: ErrorRateLimit) {
         <Button
           slot='actions'
           kind='filled'
-          onClick={props.onRetry}
+          onClick={() => getPageHandlerInstance().pageHandler.retryAPIRequest()}
         >
             {getLocale('retryButtonLabel')}
         </Button>
diff --git a/components/ai_chat/resources/page/components/feature_button_menu/index.tsx b/components/ai_chat/resources/page/components/feature_button_menu/index.tsx
index 71adf4c8c649..71ee22c688cc 100644
--- a/components/ai_chat/resources/page/components/feature_button_menu/index.tsx
+++ b/components/ai_chat/resources/page/components/feature_button_menu/index.tsx
@@ -7,8 +7,9 @@ import * as React from 'react'
 import ButtonMenu from '@brave/leo/react/buttonMenu'
 import Button from '@brave/leo/react/button'
 import Icon from '@brave/leo/react/icon'
+import Label from '@brave/leo/react/label'
 import { getLocale } from '$web-common/locale'
-import getPageHandlerInstance from '../../api/page_handler'
+import getPageHandlerInstance, * as mojom from '../../api/page_handler'
 import DataContext from '../../state/context'
 import styles from './style.module.scss'
 import classnames from '$web-common/classnames'
@@ -50,12 +51,12 @@ export default function FeatureMenu() {
         >
           <div className={styles.menuItemWithIcon}>
             <div className={styles.menuText}>
-              <div>{model.name}</div>
+              <div>{model.displayName}</div>
               <p className={styles.modelSubtitle}>
                 {getLocale(`braveLeoModelSubtitle-${model.key}`)}
               </p>
             </div>
-            {model.isPremium && (
+            {model.access === mojom.ModelAccess.PREMIUM && (
               <Icon
                 className={classnames({
                   [styles.lockOpen]: context.isPremiumUser
@@ -63,6 +64,15 @@ export default function FeatureMenu() {
                 name={context.isPremiumUser ? 'lock-open' : 'lock-plain'}
               />
             )}
+            {model.access === mojom.ModelAccess.BASIC_AND_PREMIUM && (
+              <Label
+               className={styles.modelFreemiumLabel}
+               mode={context.isPremiumUser ? 'loud' : 'default'}
+               color='blue'
+              >
+                {context.isPremiumUser ? getLocale('modelFreemiumLabelPremium') : getLocale('modelFreemiumLabelNonPremium')}
+              </Label>
+            )}
           </div>
         </leo-menu-item>
       ))}
diff --git a/components/ai_chat/resources/page/components/feature_button_menu/style.module.scss b/components/ai_chat/resources/page/components/feature_button_menu/style.module.scss
index a195e28ca62e..fce8ca0c73b0 100644
--- a/components/ai_chat/resources/page/components/feature_button_menu/style.module.scss
+++ b/components/ai_chat/resources/page/components/feature_button_menu/style.module.scss
@@ -58,6 +58,10 @@
   margin: 0;
 }
 
+.modelFreemiumLabel {
+  align-self: flex-start;
+}
+
 .lockOpen {
   --leo-icon-color: var(--leo-color-systemfeedback-success-icon);
 }
diff --git a/components/ai_chat/resources/page/components/main/index.tsx b/components/ai_chat/resources/page/components/main/index.tsx
index 1fb60230ebff..53bc1edc642e 100644
--- a/components/ai_chat/resources/page/components/main/index.tsx
+++ b/components/ai_chat/resources/page/components/main/index.tsx
@@ -45,7 +45,7 @@ function Main() {
     hasAcceptedAgreement &&
     !context.isPremiumStatusFetching && // Avoid flash of content
     !context.isPremiumUser &&
-    context.currentModel?.isPremium
+    context.currentModel?.access === mojom.ModelAccess.PREMIUM
 
   const shouldShowPremiumSuggestionStandalone =
     hasAcceptedAgreement &&
@@ -72,9 +72,7 @@ function Main() {
 
     if (apiHasError && currentError === mojom.APIError.RateLimitReached) {
       currentErrorElement = (
-        <ErrorRateLimit
-          onRetry={() => getPageHandlerInstance().pageHandler.retryAPIRequest()}
-        />
+        <ErrorRateLimit />
       )
     }
 
@@ -133,9 +131,9 @@ function Main() {
                 secondaryActionButton={
                   <Button
                     kind='plain-faint'
-                    onClick={() => context.switchToDefaultModel()}
+                    onClick={() => context.switchToBasicModel()}
                   >
-                    {getLocale('switchToDefaultModelButtonLabel')}
+                    {getLocale('switchToBasicModelButtonLabel')}
                   </Button>
                 }
               />
diff --git a/components/ai_chat/resources/page/state/context.ts b/components/ai_chat/resources/page/state/context.ts
index 44652824cdb5..bb2b95bc2987 100644
--- a/components/ai_chat/resources/page/state/context.ts
+++ b/components/ai_chat/resources/page/state/context.ts
@@ -28,7 +28,7 @@ export interface AIChatContext {
   showAgreementModal: boolean
   shouldSendPageContents: boolean
   setCurrentModel: (model: mojom.Model) => void,
-  switchToDefaultModel: () => void,
+  switchToBasicModel: () => void,
   generateSuggestedQuestions: () => void
   goPremium: () => void
   managePremium: () => void
@@ -62,7 +62,7 @@ export const defaultContext: AIChatContext = {
   showAgreementModal: false,
   shouldSendPageContents: true,
   setCurrentModel: () => {},
-  switchToDefaultModel: () => {},
+  switchToBasicModel: () => {},
   generateSuggestedQuestions: () => {},
   goPremium: () => {},
   managePremium: () => {},
diff --git a/components/ai_chat/resources/page/state/data-context-provider.tsx b/components/ai_chat/resources/page/state/data-context-provider.tsx
index ab538f789371..a81d63e8baf3 100644
--- a/components/ai_chat/resources/page/state/data-context-provider.tsx
+++ b/components/ai_chat/resources/page/state/data-context-provider.tsx
@@ -70,7 +70,7 @@ function DataContextProvider (props: DataContextProviderProps) {
   const isPremiumUser = premiumStatus !== undefined && premiumStatus !== mojom.PremiumStatus.Inactive
 
   const apiHasError = (currentError !== mojom.APIError.None)
-  const shouldDisableUserInput = !!(apiHasError || isGenerating || (!isPremiumUser && currentModel?.isPremium))
+  const shouldDisableUserInput = !!(apiHasError || isGenerating || (!isPremiumUser && currentModel?.access === mojom.ModelAccess.PREMIUM))
 
   const getConversationHistory = () => {
     getPageHandlerInstance()
@@ -128,9 +128,9 @@ function DataContextProvider (props: DataContextProviderProps) {
     setCanShowPremiumPrompt(false)
   }
 
-  const switchToDefaultModel = () => {
+  const switchToBasicModel = () => {
     // Select the first non-premium model
-    const nonPremium = allModels.find(m => !m.isPremium)
+    const nonPremium = allModels.find(m => [mojom.ModelAccess.BASIC, mojom.ModelAccess.BASIC_AND_PREMIUM].includes(m.access))
     if (!nonPremium) {
       console.error('Could not find a non-premium model!')
       return
@@ -297,7 +297,7 @@ function DataContextProvider (props: DataContextProviderProps) {
     showAgreementModal,
     shouldSendPageContents: shouldSendPageContents && siteInfo?.isContentAssociationPossible,
     setCurrentModel,
-    switchToDefaultModel,
+    switchToBasicModel,
     goPremium,
     managePremium,
     generateSuggestedQuestions,
diff --git a/components/ai_chat/resources/page/stories/components_panel.tsx b/components/ai_chat/resources/page/stories/components_panel.tsx
index ab86ec144452..b44695eed853 100644
--- a/components/ai_chat/resources/page/stories/components_panel.tsx
+++ b/components/ai_chat/resources/page/stories/components_panel.tsx
@@ -49,7 +49,7 @@ const MODELS: mojom.Model[] = [
     displayMaker: 'Company',
     engineType: mojom.ModelEngineType.LLAMA_REMOTE,
     category: mojom.ModelCategory.CHAT,
-    isPremium: false,
+    access: mojom.ModelAccess.BASIC,
     maxPageContentLength: 10000,
     longConversationWarningCharacterLimit: 9700
   },
@@ -60,7 +60,18 @@ const MODELS: mojom.Model[] = [
     displayMaker: 'Company',
     engineType: mojom.ModelEngineType.LLAMA_REMOTE,
     category: mojom.ModelCategory.CHAT,
-    isPremium: true,
+    access: mojom.ModelAccess.PREMIUM,
+    maxPageContentLength: 10000,
+    longConversationWarningCharacterLimit: 9700
+  },
+  {
+    key: '3',
+    name: 'model-three-freemium',
+    displayName: 'Model Three',
+    displayMaker: 'Company',
+    engineType: mojom.ModelEngineType.LLAMA_REMOTE,
+    category: mojom.ModelCategory.CHAT,
+    access: mojom.ModelAccess.BASIC_AND_PREMIUM,
     maxPageContentLength: 10000,
     longConversationWarningCharacterLimit: 9700
   }
diff --git a/components/ai_chat/resources/page/stories/locale.ts b/components/ai_chat/resources/page/stories/locale.ts
index 22ee3d0b0ea4..9f34969dfdf0 100644
--- a/components/ai_chat/resources/page/stories/locale.ts
+++ b/components/ai_chat/resources/page/stories/locale.ts
@@ -21,6 +21,8 @@ provideStrings({
   'introMessage-0': `I'm here to help. What can I assist you with today?`,
   'introMessage-1': 'I have a vast base of knowledge and a large memory able to help with more complex challenges.',
   modelNameSyntax: '$1 by $2',
+  modelFreemiumLabelNonPremium: 'Limited',
+  modelFreemiumLabelPremium: 'Unlimited',
   'modelCategory-chat': 'Chat',
   menuNewChat: 'New chat',
   menuSettings: 'Settings',
@@ -59,6 +61,7 @@ provideStrings({
   feedbackError: 'Your feedback could not be submitted, please check network connection and try again',
   premiumRefreshWarningDescription: 'Your Brave account session has expired. Please visit your account page to refresh, then come back to use premium features.',
   premiumRefreshWarningAction: 'Refresh',
+  switchToBasicModelButtonLabel: 'Switch to the free model',
   clearChatButtonLabel: 'Clear chat',
   errorContextLimitReaching: 'This conversation is long and Leo may start forgetting things soon. You can get longer conversations by switching to a premium model, or you can clear the chat to reset it',
   gotItButtonLabel: 'Got it',
diff --git a/components/resources/ai_chat_ui_strings.grdp b/components/resources/ai_chat_ui_strings.grdp
index 37f17ed391bd..d62ba7b7b904 100644
--- a/components/resources/ai_chat_ui_strings.grdp
+++ b/components/resources/ai_chat_ui_strings.grdp
@@ -51,11 +51,11 @@
   <message name="IDS_CHAT_UI_RETRY_BUTTON_LABEL" desc="A button label to retry API again">
      Retry
   </message>
-  <message name="IDS_CHAT_UI_INTRO_MESSAGE_CHAT_DEFAULT" desc="AI Chat intro message for the default model">
+  <message name="IDS_CHAT_UI_INTRO_MESSAGE_CHAT_BASIC" desc="AI Chat intro message for the default model">
     Hi, I'm Leo. I'm a fully hosted AI assistant by Brave. I'm powered by Llama 13B, a model created by Meta to be performant and applicable to many use cases.
   </message>
   <message name="IDS_CHAT_UI_INTRO_MESSAGE_CHAT_LEO_EXPANDED" desc="AI Chat intro message for the expanded model">
-    Hi, I'm Leo. I'm a fully hosted AI assistant by Brave. I'm powered by Llama 70B, a model created by Meta to handle more advanced tasks than 13B.
+    Hi, I'm Leo. I'm a fully hosted AI assistant by Brave. I'm powered by Mixtral 7B, a model created by Mistral AI to handle advanced tasks.
   </message>
   <message name="IDS_CHAT_UI_INTRO_MESSAGE_CHAT_LEO_CLAUDE_INSTANT" desc="AI Chat intro message for the Claude Instant model">
     Hi, I'm Leo. I'm proxied by Brave and powered by Claude Instant, a model created by Anthropic to power conversational and text processing tasks.
@@ -63,6 +63,12 @@
   <message name="IDS_CHAT_UI_MODEL_NAME_SYNTAX" desc="Sentence structure for model name">
     <ph name="MODEL_NAME">$1<ex>llama2-13b</ex></ph> by <ph name="COMPANY_NAME">$2<ex>Meta</ex></ph>
   </message>
+  <message name="IDS_CHAT_UI_MODEL_FREEMIUM_LABEL_NON_PREMIUM" desc="Label indentifying that a model is limited in functionality due to user's non-premium status">
+    Limited
+  </message>
+  <message name="IDS_CHAT_UI_MODEL_FREEMIUM_LABEL_PREMIUM" desc="Label indentifying that a model is not limited in functionality as the user is a premium subscriber">
+    Unlimited
+  </message>
   <message name="IDS_CHAT_UI_MODEL_CATEGORY_CHAT" desc="Category name for Chat">
     Chat
   </message>
@@ -106,8 +112,8 @@
   <message name="IDS_CHAT_UI_DISMISS_BUTTON_LABEL" desc="A button label to dismiss dialog">
     Dismiss
   </message>
-  <message name="IDS_CHAT_UI_SWITCH_TO_DEFAULT_MODEL_BUTTON_LABEL" desc="A button label to switch to the free model">
-    Switch to the default model
+  <message name="IDS_CHAT_UI_SWITCH_TO_BASIC_MODEL_BUTTON_LABEL" desc="A button label to switch to the free model">
+    Switch to the free model
   </message>
   <message name="IDS_CHAT_UI_UNLOCK_PREMIUM_TITLE" desc="A heading on prompt premium suggestion UI">
     Unlock the full potential of Leo
@@ -202,7 +208,7 @@
   <message name="IDS_CHAT_UI_CONVERSATION_END_ERROR" desc="An error issued when the user cannot continue chatting">
     This conversation is too long and cannot continue. There may be other models available with which Leo is capable of maintaining accuracy for longer conversations.
   </message>
-  <message name="IDS_CHAT_UI_CHAT_DEFAULT_SUBTITLE" desc="A description for default chat model">
+  <message name="IDS_CHAT_UI_CHAT_BASIC_SUBTITLE" desc="A description for default chat model">
     General purpose chat
   </message>
   <message name="IDS_CHAT_UI_CHAT_LEO_EXPANDED_SUBTITLE" desc="A description for llama-2-70b model">
diff --git a/test/BUILD.gn b/test/BUILD.gn
index 4f1df43ac7e2..9a3cc1a6b19b 100644
--- a/test/BUILD.gn
+++ b/test/BUILD.gn
@@ -360,6 +360,7 @@ test("brave_unit_tests") {
     deps += [
       "//brave/browser/ai_chat:unit_tests",
       "//brave/components/ai_chat/core/browser:unit_tests",
+      "//brave/components/ai_chat/core/common:unit_tests",
     ]
   }