Learning What to Distill: Bilevel Top-K Token Selection for Self-Distillation in Large Language Models

On-policy distillation is an efficient alternative to reinforcement learning, offering dense token-level training signals. However, its reliance on a stronger external teacher has driven recent work on on-policy self-distillation, where the same model serves as both teacher and student under different prompt contexts. Yet, existing self-distillation methods largely reduce learning to KL matching toward the context-augmented teacher model. This approach often suffers from training instability and can degrade reasoning performance over time. Moreover, self-distillation from the same model with prompt augmentation lacks the exploratory diversity provided by a genuine external teacher. To address these limitations, we move beyond fixed-teacher KL matching and propose \textbf{P}reference-\textbf{B}ased \textbf{S}elf-\textbf{D}istillation (\textbf{PBSD}), which revisits on-policy self-distillation through a reward-regularized perspective. Instead of directly matching the teacher distribution, we derive a reward-regularized objective whose analytic optimum is a reward-reweighted teacher distribution, yielding a target policy provably superior to the original teacher under this objective. Practically, PBSD optimizes preference gaps between teacher and student samples while maintaining on-policy student sampling. We support this framework with a statistical analysis of the induced preference-learning problem, formally establishing when on policy self-distillation is preferable to learning from an external teacher in our setting. Experiments on mathematical reasoning and tool-use benchmarks across multiple model scales demonstrate that PBSD consistently achieves the strongest average performance among comparable baselines, showing improved training stability over prior self-distillation baselines while preserving token efficiency.

On-policy self-distillation (OPSD) is an emerging LLM post-training paradigm in which the model serves as its own teacher: conditioned on privileged information such as a reference trace or hint, the same policy provides dense token-level supervision on its own rollouts. However, recent studies show that OPSD degrades complex reasoning by suppressing predictive uncertainty, which supports exploration and hypothesis revision. Our token-level analysis shows that this failure arises from applying a uniform direction of teacher supervision across tokens with different uncertainty levels: conformity to the privileged self-teacher suppresses exploration at high entropy, while deviation from the teacher degrades step accuracy at low entropy. Accordingly, we propose \textbf{Direction-Adaptive Self-Distillation} (\textbf{DASD}), which reframes privileged self-distillation from uniform teacher imitation into entropy-routed directional supervision: high-entropy tokens are pushed away from the privileged teacher to preserve exploration, while low-entropy tokens are pulled toward the teacher to stabilize step-level execution. Across six mathematical reasoning benchmarks, DASD achieves the best macro Avg@16 over strong RLVR and self-distillation baselines. Pass@$k$, reasoning-health, and generalization analyses show that these average gains come from preserving exploration without sacrificing step-level execution.

On-policy self-distillation (OPSD) has emerged as a practical method for training large language models (LLMs) to reason, where a single model acts as both the teacher and the student with different levels of information access. However, recent studies have found that the teacher's dense token-level supervision, conditioned on privileged information, can lead to overfitting to in-domain patterns, suppress exploration, and hurt cross-domain generalization, while also introducing a more fundamental issue: privileged information leakage, where the student encodes answer-dependent shortcuts that are unavailable at test time. We introduce DemoPSD, a novel framework that resolves such problems through the idea of selective adoption of teacher guidance. Instead of fitting the full teacher distribution, DemoPSD steers the student toward a reverse-KL barycenter target, a weighted geometric combination of the teacher and student distributions, that naturally balances learning from the teacher with preserving the student's own reasoning capacity. We measure the difference between their distributions and use such a discrepancy to adaptively control the blending at each token position. We provably show that DemoPSD achieves (1) leakage attenuation, i.e., effective mitigation of privileged information leakage; and (2) exploration preservation, i.e., preservation of exploration capacity under dense token-level distillation. Extensive experiments on SciKnowEval across four scientific fields show that DemoPSD outperforms both GRPO and SDPO while maintaining higher training entropy and robustly generalizing to out-of-distribution GPQA benchmarks.