Research shows that penal state involvement facilitates a wide range of detrimental consequences, yet existing theoretical accounts tend to focus on stigma or exclusion, leaving the role of individual decision-making underspecified. To address this gap, I advance the concept of collateral decision-making: the process by which individuals, embedded in a criminal legal institution, make decisions that carry adverse consequences in another institution, whether within or beyond the criminal legal sphere. Through this process, individuals reframe how they navigate a particular institution to mitigate negative experiences generated by a criminal legal institution. I analyze in-depth interviews with 65 pretrial detainees simultaneously embedded in jails and criminal courts—two state institutions that constitute distinct structural constraints, functions, and decision-making points. The findings expose why and how the disadvantage of pretrial detention recalibrates decision-making and translates into unfavorable court outcomes, as detainees accept plea agreements to escape violence, the misery of court holding tanks, poor jail conditions, and address primary-caregiver role strain—even while maintaining their innocence. The analysis also reveals that detainees sometimes forgo the potential benefit of legal counsel, offering a compelling account of how this decision appears reasonable within the structural constraints of jail detention, yet ultimately reproduces institutional disadvantage. The findings illustrate how penal state involvement cascades across institutional boundaries, shaping individual behavior and reinforcing social disparities.