diff --git a/plans/15-dsl-graph-generation.md b/plans/15-dsl-graph-generation.md
index f563856..4dd5a69 100644
--- a/plans/15-dsl-graph-generation.md
+++ b/plans/15-dsl-graph-generation.md
@@ -141,7 +141,181 @@ bazel run @test_graph//:job_lookup -- \
 
 ---
 
-### Phase 3: Graph Integration
+### Phase 3: Two-Phase Code Generation
+**Goal**: Implement proper two-phase code generation that works within Bazel's constraints
+
+#### Key Learning
+Previous attempts failed due to fundamental Bazel constraints:
+- **Loading vs Execution phases**: `load()` statements run before genrules execute
+- **Dynamic target generation**: Bazel requires the complete build graph before execution begins  
+- **Hermeticity**: Generated BUILD files must be in source tree, not bazel-bin
+
+The solution: **Two-phase generation** following established patterns from protobuf, thrift, and other code generators.
+
+#### Two-Phase Workflow
+
+**Phase 1: Code Generation** (run by developer)
+```bash
+bazel run //databuild/test/app/dsl:graph.generate
+# Generates BUILD.bazel and Python binaries into source tree
+```
+
+**Phase 2: Building** (normal Bazel workflow)  
+```bash
+bazel build //databuild/test/app/dsl:graph.analyze
+bazel run //databuild/test/app/dsl:graph.service -- --port 8080
+```
+
+#### Implementation Tasks
+
+1. **Create `databuild_dsl_generator` rule**:
+   ```python
+   databuild_dsl_generator(
+       name = "graph.generate",
+       graph_file = "graph.py", 
+       output_package = "//databuild/test/app/dsl",
+       deps = [":dsl_src"],
+   )
+   ```
+
+2. **Implement generator that writes to source tree**:
+   ```python
+   def _databuild_dsl_generator_impl(ctx):
+       script = ctx.actions.declare_file(ctx.label.name + "_generator.py")
+       
+       # Create a script that:
+       # 1. Loads the DSL graph
+       # 2. Generates BUILD.bazel and binaries 
+       # 3. Writes them to the source tree
+       script_content = """
+import os
+import sys
+# Add workspace root to path
+workspace_root = os.environ.get('BUILD_WORKSPACE_DIRECTORY')
+output_dir = os.path.join(workspace_root, '{package_path}')
+
+# Load and generate
+from {module_path} import {graph_attr}
+{graph_attr}.generate_bazel_package('{name}', output_dir)
+print(f'Generated BUILD.bazel and binaries in {{output_dir}}')
+       """.format(
+           package_path = ctx.attr.output_package.strip("//").replace(":", "/"),
+           module_path = ctx.file.graph_file.path.replace("/", ".").replace(".py", ""),
+           graph_attr = ctx.attr.graph_attr,
+           name = ctx.attr.name.replace(".generate", ""),
+       )
+       
+       ctx.actions.write(
+           output = script,
+           content = script_content,
+           is_executable = True,
+       )
+       
+       return [DefaultInfo(executable = script)]
+   ```
+
+3. **Update `DataBuildGraph.generate_bazel_package()` to target source tree**:
+   ```python
+   def generate_bazel_package(self, name: str, output_dir: str) -> None:
+       """Generate BUILD.bazel and binaries into source directory"""
+       # Generate BUILD.bazel with real databuild targets
+       self._generate_build_bazel(output_dir, name)
+       
+       # Generate job binaries
+       self._generate_job_binaries(output_dir)
+       
+       # Generate job lookup
+       self._generate_job_lookup(output_dir)
+       
+       print(f"Generated package in {output_dir}")
+       print("Run 'bazel build :{name}.analyze' to use")
+   ```
+
+4. **Create standard BUILD.bazel template**:
+   ```python
+   def _generate_build_bazel(self, output_dir: str, name: str):
+       # Generate proper databuild_job and databuild_graph targets
+       # that will work exactly like hand-written ones
+       build_content = self._build_template.format(
+           jobs = self._format_jobs(),
+           graph_name = f"{name}_graph",
+           job_targets = self._format_job_targets(),
+       )
+       
+       with open(os.path.join(output_dir, "BUILD.bazel"), "w") as f:
+           f.write(build_content)
+   ```
+
+#### Interface Design
+
+**For DSL Authors**:
+```python
+# In graph.py
+graph = DataBuildGraph("my_graph")
+
+@graph.job
+class MyJob(DataBuildJob):
+    # ... job definition
+```
+
+**For Users**:
+```bash
+# Generate code (phase 1)
+bazel run //my/app:graph.generate
+
+# Use generated code (phase 2) 
+bazel build //my/app:graph.analyze
+bazel run //my/app:graph.service
+```
+
+**In BUILD.bazel**:
+```python
+databuild_dsl_generator(
+    name = "graph.generate",
+    graph_file = "graph.py",
+    output_package = "//my/app", 
+    deps = [":my_deps"],
+)
+
+# After generation, this file will contain:
+# databuild_graph(name = "graph_graph", ...)
+# databuild_job(name = "my_job", ...)
+# py_binary(name = "my_job_binary", ...)
+```
+
+#### Benefits of This Approach
+
+✅ **Works within Bazel constraints** - No dynamic target generation  
+✅ **Follows established patterns** - Same as protobuf, thrift, OpenAPI generators  
+✅ **Inspectable output** - Users can see generated BUILD.bazel  
+✅ **Version controllable** - Generated files can be checked in if desired  
+✅ **Incremental builds** - Standard Bazel caching works perfectly  
+✅ **Clean separation** - Generation vs building are separate phases  
+
+#### Tests & Verification
+```bash
+# Test: Code generation
+bazel run //databuild/test/app/dsl:graph.generate
+# Should create BUILD.bazel and Python files in source tree
+
+# Test: Generated targets work
+bazel build //databuild/test/app/dsl:graph_graph.analyze  
+# Should build successfully using generated BUILD.bazel
+
+# Test: End-to-end functionality
+bazel run //databuild/test/app/dsl:graph_graph.analyze -- "color_vote_report/2024-01-01/red"
+# Should work exactly like hand-written graph
+```
+
+#### Success Criteria
+- Generator creates valid BUILD.bazel in source tree
+- Generated targets are indistinguishable from hand-written ones  
+- Full DataBuild functionality works through generated code
+- Clean developer workflow with clear phase separation
+
+---
+
+### Phase 4: Graph Integration
 **Goal**: Generate complete databuild graph targets with all operational variants
 
 #### Deliverables