Hallucination in Large Language Models (LLMs), characterized by the generation of content inconsistent with contextual facts or logical constraints -- remains a persistent challenge for reliable deployment. In this work, we address this issue through a geometric framework rooted in the linear representation hypothesis. We propose that hallucinations manifest as orthogonal noise relative to the semantic manifold of the residual stream. Specifically, we hypothesize that while attention heads ideally propagate information congruent with the context subspace, hallucinations arise when specific heads introduce components orthogonal to this subspace, disrupting the coherence of the latent representation. Based on this formulation, we introduce Dynamic Contextual Orthogonalization (DCO), an inference-time intervention method. DCO utilizes the input residual stream as a dynamic context anchor to perform orthogonal decomposition on attention head outputs. To distinguish between context-aligned semantic updates and divergent noise, DCO employs a layer-wise Z-score suppression mechanism that selectively attenuates outlier orthogonal components based on statistical distributions. Evaluations on Llama-3-8B and 70B across benchmarks such as XSum, NQ-Swap, and IFEval demonstrate that DCO achieves superior contextual faithfulness compared to state-of-the-art intervention baselines. Furthermore, DCO maintains high performance on knowledge-intensive tasks like TriviaQA and TruthfulQA, effectively mitigating the trade-off between hallucination suppression and parametric knowledge retention often observed in existing methods. Our findings validate the geometric interpretation of hallucinations and establish DCO as a computationally efficient approach for enforcing manifold alignment.Our code is available at https://github.com/Harry-Miral/DCO