Towards Understanding On-Policy Distillation through the Lens of Test-Time Scaling
Authors: Xinmu Ge, Zizhuo Zhang, Yu Huang, Jianing Zhu, Lin Yuan, Wanli Gu, Weichang Wu, Weiran Huang, +4 more
Organizations: 1Shanghai Jiao Tong University · 2Shanghai Innovation Institute · 3Ant Group · 4Hong Kong Baptist University · University of Texas at Austin
Abstract
On-policy distillation (OPD) has emerged as a promising post-training technique for enhancing LLM reasoning. It is commonly believed to enable the student model to distill knowledge from a stronger teacher model, thereby expanding capabilities beyond the pre-OPD base model. In this study, we examine this view through the lens of test-time scaling by varying the sampling budget K and evaluating performance with pass@K and avg@K. Specifically, across several OPD variants, we observe that OPD-trained models maintain superior avg@K performance across sampling budgets, while the advantage in pass@K gradually shifts to the pre-OPD base models as K increases. These results suggest that OPD primarily improves sampling efficiency rather than consistently expanding the student's reasoning capability boundary. The pass@K dynamics throughout OPD training further reveal a progressive shift toward stronger small-K performance at the expense of the large-K capability boundary. Furthermore, a problem-level solvability analysis using pass@1024 as the criterion reveals an asymmetry: OPD causes more previously solvable problems to become unsolvable than previously unsolvable problems to become solvable. Together, these findings suggest that, from the perspective of capability expansion, OPD behaves more like an "illusory distillation": its apparent gains arise primarily from improved sampling efficiency rather than from acquiring genuinely new reasoning capabilities from the teacher.
On-policy distillation (OPD) and on-policy self-distillation (OPSD) have emerged as promising post-training methods for large language models, offering dense token-level supervision on trajectories sampled from the model's own policy. However, existing results on their effectiveness remain mixed: while OP(S)D has shown promise in system prompt and knowledge internalization, recent studies also report instability and degradation. In this work, we present a comprehensive empirical study of when OPD and OPSD work, when they fail, and why. We find that OPD on mathematical reasoning is highly sensitive to teacher choice and loss formulation, whereas OPSD fails in our tested settings due to test-time absence of instance-specific privileged information (PI). In contrast, OPSD is effective when PI represents a shared latent rule, such as a system prompt or alignment preference. We identify three failure mechanisms: (1) distribution mismatch between teacher and student caused by conditioning on student-generated prefixes, (2) optimization instability from biased TopK reverse-KL gradients, and (3) an OPSD-specific limitation where the student learns a PI-free policy that aggregates PI-conditioned teachers, which is insufficient when PI is instance-specific. We further show that stop-gradient TopK objectives, RLVR-adapted teachers, and SFT-stabilized students mitigate these failures.
On-policy distillation (OPD) has become a key paradigm in LLM post-training, yet its training dynamics remain poorly understood. We present a systematic study examining the role, pathologies, and regulations of OPD. We first clarify the role of OPD as an exploration catalyst: it steers the student toward correct reasoning paths via dense token-level guidance, without expanding capability ceiling. We confirm this by showing that prompt diversity matters more than per-problem sampling numbers, and critically, that the effectiveness of OPD hinges entirely on the quality of its guiding signal. This dependency exposes two pathologies that derail exploration. The Student-Teacher Mismatch occurs when a large teacher-student distributional gap causes the guiding signal to misalign with task correctness, steering exploration in counterproductive directions. Length Exploitation arises when the aggregated token-level objective creates length-dependent shortcuts, allowing the student to game the reward landscape through response truncation or redundant padding, exploring degenerate length modes rather than reasoning strategies. To tame these pathologies, we investigate lightweight signal regulations: advantage clipping and log-scale compression, ensuring exploration is guided by faithful signals. Experiments across seven benchmarks demonstrate that these regulations alleviate length exploitation and enable effective distillation, stably surpassing OPD variants and RLVR baselines, thereby confirming that well-regulated signal quality, rather than mere teacher scale, governs successful exploration in OPD.
On-Policy Distillation (OPD) improves large language model reasoning by training a student model on trajectories sampled from its own policy under teacher supervision. Although OPD operates on trajectories, its learning signal remains token-level: it identifies deviations through high-loss tokens and repairs them through local reverse-KL correction. We show that this "trajectory-sampled but token-learned" mechanism cannot reliably bridge student trajectories toward teacher trajectories. About 30% of high-loss tokens fall into the low-divergence regime, indicating that many are surface-form mismatches rather than real reasoning forks. Moreover, even truly divergent tokens are difficult to repair with isolated token-level supervision, since reasoning failures often unfold as short-horizon distributional drift. We propose Trajectory-aware OPD (TOPD), which uses near-future trajectory information to identify real divergent states and distribute guidance across multiple future tokens. Experiments show that suppressing non-divergent high-loss tokens improves standard OPD from 47.8% to 48.2% average accuracy, while TOPD further improves performance to 52.2%, with gains on AIME24 from 60.0% to 63.3% and AIME25 from 46.7% to 53.3%.