Efficient Safety Guardrails through Latent Dual-Hypothesis Reasoning with On-Demand Trace Reconstruction

Guardrail approaches that rely on reasoning-based large language models (LLM) improve safety decisions, but come with substantial inference overhead due to the explicit reasoning. We introduce LR-Guard (Latent Reasoning Guardrail), an efficient and explainable guardrail that jointly learns structured latent reasoning and on-demand reasoning reconstruction. Our method distills a frozen teacher's analysis of safe and unsafe prompt interpretations and their comparison into compact latent representations. Joint training optimizes these representations for both safety prediction and reconstruction of the teacher's explicit reasoning traces, enabling human-readable explanations without requiring intermediate text generation for every decision. Experiments show that LR-Guard outperforms its explicit-reasoning teacher in most in-domain and out-of-domain settings on safety classification and explanation extraction, while achieving a 19.4x inference speedup at batch size one. Further, reconstructed reasoning traces from the latent information exhibit high semantic similarity to the teacher's explicit reasoning.