diff --git a/EULA.md b/EULA.md
new file mode 100644
index 0000000..7d74446
--- /dev/null
+++ b/EULA.md
@@ -0,0 +1,54 @@
+# End User License Agreement
+
+Effective July 23, 2026
+
+This End User License Agreement (the "Agreement") governs your use of the
+setup-mongodb-database-tools GitHub Action (the "Action"). Brian Lund (the
+"Developer") provides the Action.
+
+By obtaining or using the Action through GitHub Marketplace or another source,
+you accept this Agreement. Do not use the Action if you do not accept it.
+
+## License
+
+The Developer licenses the Action under the [MIT License](LICENSE). The MIT
+License forms part of this Agreement and governs your rights to use, copy,
+modify, merge, publish, distribute, sublicense, or sell copies of the Action.
+If this Agreement conflicts with the MIT License concerning those rights, the
+MIT License controls.
+
+## Third-party software
+
+MongoDB, Inc. operates the services from which the Action downloads MongoDB
+Database Tools. The Action repository does not include those tools, and the
+Developer does not license them to you. MongoDB's terms govern your acquisition
+and use of MongoDB Database Tools. Review
+[MongoDB's licensing terms](https://www.mongodb.com/legal/licensing/community-edition)
+to confirm that they permit your intended use.
+
+MongoDB is a registered trademark of MongoDB, Inc. The Developer has no
+affiliation with MongoDB, Inc., and MongoDB, Inc. does not endorse the Action.
+
+## Support
+
+Use the
+[repository issue tracker](https://github.com/brianlund/setup-mongodb-database-tools/issues)
+to report bugs and request support. Report suspected vulnerabilities through
+the repository's private vulnerability reporting feature as described in the
+[security policy](SECURITY.md).
+
+## Warranty and liability
+
+The warranty disclaimer and limitation of liability in the MIT License apply
+to the Action. Where applicable law limits those terms, they apply to the
+maximum extent that the law permits.
+
+## Parties
+
+You and the Developer are the only parties to this Agreement. This Agreement
+does not impose obligations on GitHub, Inc. or MongoDB, Inc.
+
+## Changes
+
+Each release includes the version of this Agreement that applies to that
+release. Changes to this Agreement apply to later releases.
diff --git a/README.md b/README.md
index a7e0966..9658b2c 100644
--- a/README.md
+++ b/README.md
@@ -6,6 +6,9 @@ Install [MongoDB Database Tools](https://www.mongodb.com/docs/database-tools/)
 on a GitHub Actions runner. The action adds `mongodump`, `mongorestore`,
 `mongoexport`, `mongoimport`, and the other Database Tools commands to `PATH`.
 
+This community-maintained action is not affiliated with or endorsed by
+MongoDB, Inc.
+
 ## Usage
 
 ```yaml
@@ -111,9 +114,12 @@ machine.
 For security-sensitive workflows, pin third-party actions to a full commit SHA.
 Maintainers move major tags such as `v1` to deliver compatible fixes.
 
-## License
+## License and terms
 
-[MIT](LICENSE)
+Brian Lund licenses the action source code under the [MIT License](LICENSE).
+The [End User License Agreement](EULA.md) also governs your use of the action.
 
-This project is not affiliated with or endorsed by MongoDB, Inc. MongoDB is a
-registered trademark of MongoDB, Inc.
+This repository does not include MongoDB Database Tools. The action downloads
+them from MongoDB, and
+[MongoDB's terms](https://www.mongodb.com/legal/licensing/community-edition)
+govern their use. MongoDB is a registered trademark of MongoDB, Inc.