# Agent Fine-tuning through Distillation for Domain-specific LLMs in Microdomains

arXiv: https://arxiv.org/abs/2510.00482 · HTML: https://mlsanity.com/paper/2510.00482/

## Key facts

- Cited by 1 papers in the map (data through 14 Oct 2026).
- Placed in General LLM agent frameworks and benchmarks, one of 16 directions in LLM agents and tool use.
- Builds on 15 of its 24 references that are in the map.
- First posted on arXiv 1 Oct 2025.

## Placed in

- LLM agents and tool use / [General LLM agent frameworks and benchmarks](https://mlsanity.com/agents/general-llm-agent-frameworks-and-benchmarks/)

## Builds on (most cited first, 15 of 15)

- [GPT-4 Technical Report](https://mlsanity.com/paper/2303.08774/) (2023)
- [Chain-of-Thought Prompting Elicits Reasoning in Large Language Models](https://mlsanity.com/paper/2201.11903/) (2022)
- [Retrieval-Augmented Generation for Knowledge-Intensive NLP Tasks](https://mlsanity.com/paper/2005.11401/) (2020)
- [Decoupled Weight Decay Regularization](https://mlsanity.com/paper/1711.05101/) (2017)
- [Deduplicating Training Data Makes Language Models Better](https://mlsanity.com/paper/2107.06499/) (2021)
- [To CoT or not to CoT? Chain-of-thought helps mainly on math and symbolic reasoning](https://mlsanity.com/paper/2409.12183/) (2024)
- [FireAct: Toward Language Agent Fine-tuning](https://mlsanity.com/paper/2310.05915/) (2023)
- [From LLM Reasoning to Autonomous AI Agents: A Comprehensive Review](https://mlsanity.com/paper/2504.19678/) (2025)
- [Evaluation of Retrieval-Augmented Generation: A Survey](https://mlsanity.com/paper/2405.07437/) (2024)
- [Table Meets LLM: Can Large Language Models Understand Structured Table Data? A Benchmark and Empirical Study](https://mlsanity.com/paper/2305.13062/) (2023)
- [Agent-FLAN: Designing Data and Methods of Effective Agent Tuning for Large Language Models](https://mlsanity.com/paper/2403.12881/) (2024)
- [A Survey on Multilingual Large Language Models: Corpora, Alignment, and Bias](https://mlsanity.com/paper/2404.00929/) (2024)
- [AutoAct: Automatic Agent Learning from Scratch for QA via Self-Planning](https://mlsanity.com/paper/2401.05268/) (2024)
- [Agent Lumos: Unified and Modular Training for Open-Source Language Agents](https://mlsanity.com/paper/2311.05657/) (2023)
- [Improving Agent Behaviors with RL Fine-tuning for Autonomous Driving](https://mlsanity.com/paper/2409.18343/) (2024)

## Built on by (most cited first, 1 of 1)

- [Is Micro Domain-Adaptive Pre-Training Effective for Real-World Operations? Multi-Step Evaluation Reveals Potential and Bottlenecks](https://mlsanity.com/paper/2602.04466/) (2026)

## Abstract (arXiv)

Agentic large language models (LLMs) have become prominent for autonomously interacting with external environments and performing multi-step reasoning tasks. Most approaches leverage these capabilities via in-context learning with few-shot prompts, but this often results in lengthy inputs and higher computational costs. Agent fine-tuning offers an alternative by enabling LLMs to internalize procedural reasoning and domain-specific knowledge through training on relevant data and demonstration trajectories. While prior studies have focused on general domains, their effectiveness in specialized technical microdomains remains unclear. This paper explores agent fine-tuning for domain adaptation within Hitachi's JP1 middleware, a microdomain for specialized IT operations. We fine-tuned LLMs using JP1-specific datasets derived from domain manuals and distilled reasoning trajectories generated by LLMs themselves, enhancing decision making accuracy and search efficiency. During inference, we used an agentic prompt with retrieval-augmented generation and introduced a context-answer extractor to improve information relevance. On JP1 certification exam questions, our method achieved a 14% performance improvement over the base model, demonstrating the potential of agent fine-tuning for domain-specific reasoning in complex microdomains.