What do you do when you are passed over for promotion?
Find out why, specifically, before deciding anything — because the response to "you were close and here is the gap" is completely different from the response to a decision that was never about you.
The conversation to have. Ask your manager directly: what specifically was the deciding factor, what would need to be different, and is there a realistic path and timeframe. Ask for examples rather than qualities — "more strategic" is not actionable, while "you have not led a project across teams" is.
Listen for which of these it actually was:
A genuine capability gap, which is workable and the best outcome of the conversation.
A visibility gap, where your work is good and the decision-makers did not know about it. Common, fixable, and a management failure as much as yours.
Timing or headcount — the role went to someone whose move unblocked something else, or there was one position and two viable people.
A decision made before the process began, which happens and is worth knowing.
Something unfair. If the reasons are vague, shifting, or relate to a protected characteristic, that is a different matter with formal routes.
How to conduct yourself immediately. Be professional with the successful candidate, since the organisation is watching and resentment costs you more than the promotion was worth. Take a few days before reacting to anything.
Then get it in writing. A development plan with specific, agreed criteria and a review date — which converts a vague promise into something you can hold people to, and reveals immediately whether the intention is genuine.
The honest assessment to make. If you are told there is a path, watch what happens over the next two review cycles. A second refusal after meeting agreed criteria tells you the criteria were not the reason, and at that point staying is a choice rather than a strategy.
Promotion is frequently easier externally, which is an uncomfortable fact about how organisations price internal and external candidates — and worth knowing before you decide.