diff --git a/src/frontend/components/_molecules/project-tree/__tests__/leaf-highlight.test.tsx b/src/frontend/components/_molecules/project-tree/__tests__/leaf-highlight.test.tsx
new file mode 100644
index 000000000..6ccd11fc7
--- /dev/null
+++ b/src/frontend/components/_molecules/project-tree/__tests__/leaf-highlight.test.tsx
@@ -0,0 +1,71 @@
+import { fireEvent, render, screen } from '@testing-library/react'
+
+import { useOpenPLCStore } from '../../../../store'
+import { ProjectTreeExpandableLeaf, ProjectTreeLeaf } from '../index'
+
+// https://github.com/Autonomy-Logic/openplc-editor/issues/640
+// The explorer used to pass a search-highlight HTML string as the leaf `label`,
+// which ProjectTreeLeaf renders as plain text — after any project search, the
+// matching POU's name appeared in the tree as literal markup
+// (`<span class="bg-brand-light...`). The label must stay the element's real
+// name; highlighting is applied safely inside the leaf via `highlightQuery`.
+describe('ProjectTreeLeaf search highlight', () => {
+  it('renders the plain name and applies a safe highlight when highlightQuery matches', () => {
+    const { container } = render(
+      <ProjectTreeLeaf leafLang='fbd' leafType='function-block' label='Taktgeber' highlightQuery='Takt' />,
+    )
+
+    expect(screen.getByText(/Takt/).textContent).not.toContain('<span')
+    expect(container.textContent).toBe('Taktgeber')
+
+    const highlight = container.querySelector('span.bg-brand-light')
+    expect(highlight).not.toBeNull()
+    expect(highlight?.textContent).toBe('Takt')
+  })
+
+  it('renders the plain name without highlight markup when there is no query', () => {
+    const { container } = render(<ProjectTreeLeaf leafLang='fbd' leafType='function-block' label='Taktgeber' />)
+
+    expect(container.textContent).toBe('Taktgeber')
+    expect(container.querySelector('span.bg-brand-light')).toBeNull()
+  })
+
+  it('never shows literal markup for a non-matching query', () => {
+    const { container } = render(
+      <ProjectTreeLeaf leafLang='fbd' leafType='function-block' label='Taktgeber' highlightQuery='zzz' />,
+    )
+
+    expect(container.textContent).toBe('Taktgeber')
+    expect(container.textContent).not.toContain('<span')
+  })
+
+  it('keeps the plain name as the element identity while highlighted', () => {
+    const { container } = render(
+      <ProjectTreeLeaf leafLang='fbd' leafType='function-block' label='Taktgeber' highlightQuery='Takt' />,
+    )
+
+    const leaf = container.querySelector('li')
+    expect(leaf).not.toBeNull()
+    if (leaf) fireEvent.click(leaf)
+
+    // Selection must record the real POU name, never the decorated display string.
+    const { selectedProjectTreeLeaf } = useOpenPLCStore.getState().workspace
+    expect(selectedProjectTreeLeaf.label).toBe('Taktgeber')
+  })
+
+  it('applies the same safe highlighting on expandable leaves', () => {
+    const { container } = render(
+      <ProjectTreeExpandableLeaf
+        leafLang='remoteDevice'
+        leafType='remote-device'
+        label='EtherBus'
+        highlightQuery='Ether'
+      />,
+    )
+
+    expect(container.textContent).toContain('EtherBus')
+    expect(container.textContent).not.toContain('<span')
+    const highlight = container.querySelector('span.bg-brand-light')
+    expect(highlight?.textContent).toBe('Ether')
+  })
+})
diff --git a/src/frontend/components/_molecules/project-tree/index.tsx b/src/frontend/components/_molecules/project-tree/index.tsx
index a78f114c2..e0d859fd0 100644
--- a/src/frontend/components/_molecules/project-tree/index.tsx
+++ b/src/frontend/components/_molecules/project-tree/index.tsx
@@ -35,6 +35,7 @@ import { useOpenPLCStore } from '../../../store'
 import { WorkspaceProjectTreeLeafType } from '../../../store/slices/workspace/types'
 import { cn } from '../../../utils/cn'
 import { isUnsaved, unsavedLabel } from '../../../utils/unsaved-label'
+import { HighlightedText } from '../../_atoms/highlighted-text'
 import { toast } from '../../_features/[app]/toast/use-toast'
 
 const pousAllLanguages = ['il', 'st', 'python', 'cpp', 'ld', 'sfc', 'fbd'] as const
@@ -245,6 +246,12 @@ type IProjectTreeExpandableLeafProps = ComponentPropsWithoutRef<'li'> & {
   leafLang: IProjectTreeLeafProps['leafLang']
   leafType: WorkspaceProjectTreeLeafType
   label?: string
+  /**
+   * Search query used only to highlight matches in the displayed label.
+   * Kept separate from `label`, which must stay the element's real name:
+   * rename/duplicate/delete and selection all use `label` as identity.
+   */
+  highlightQuery?: string
   children?: ReactNode
 }
 
@@ -252,6 +259,7 @@ const ProjectTreeExpandableLeaf = ({
   leafLang,
   leafType,
   label,
+  highlightQuery,
   children,
   onClick: handleLeafClick,
   ...res
@@ -373,7 +381,7 @@ const ProjectTreeExpandableLeaf = ({
               )}
               onDoubleClick={() => !isDebuggerVisible && setIsEditing(true)}
             >
-              {handleLabel(label) || ''}
+              <HighlightedText text={handleLabel(label) || ''} searchQuery={highlightQuery} />
             </span>
           )}
         </div>
@@ -455,6 +463,12 @@ type IProjectTreeLeafProps = ComponentPropsWithoutRef<'li'> & {
     | 'userManagement'
   leafType: WorkspaceProjectTreeLeafType
   label?: string
+  /**
+   * Search query used only to highlight matches in the displayed label.
+   * Kept separate from `label`, which must stay the element's real name:
+   * rename/duplicate/delete and selection all use `label` as identity.
+   */
+  highlightQuery?: string
   busName?: string
   deviceId?: string
 }
@@ -492,6 +506,7 @@ const ProjectTreeLeaf = ({
   leafLang,
   leafType,
   label,
+  highlightQuery,
   busName,
   deviceId,
   onClick: handleLeafClick,
@@ -762,7 +777,7 @@ const ProjectTreeLeaf = ({
           )}
           onDoubleClick={() => !isDebuggerVisible && setIsEditing(true)}
         >
-          {handleLabel(label) || ''}
+          <HighlightedText text={handleLabel(label) || ''} searchQuery={highlightQuery} />
         </span>
       )}
 
diff --git a/src/frontend/components/_organisms/explorer/project.tsx b/src/frontend/components/_organisms/explorer/project.tsx
index 82aa9982e..63f700211 100644
--- a/src/frontend/components/_organisms/explorer/project.tsx
+++ b/src/frontend/components/_organisms/explorer/project.tsx
@@ -4,7 +4,6 @@ import { projectCapabilities } from '../../../../middleware/shared/ports/types'
 import { useCapabilities, useProject } from '../../../../middleware/shared/providers'
 import { FolderIcon } from '../../../assets/icons/interface/Folder'
 import { useOpenPLCStore } from '../../../store'
-import { extractSearchQuery } from '../../../store/slices/search/utils'
 import type { TabsProps } from '../../../store/slices/tabs'
 import { CreateEditorObjectFromTab, LIBRARY_MANIFEST_TAB_NAME } from '../../../store/slices/tabs/utils'
 import { isUserManagementCapableRuntime } from '../../../utils/device'
@@ -212,7 +211,8 @@ const Project = () => {
                   key={pou.name}
                   leafLang={pou.body.language as PouLeafLang}
                   leafType='function'
-                  label={searchQuery ? extractSearchQuery(pou.name, searchQuery) : pou.name}
+                  label={pou.name}
+                  highlightQuery={searchQuery}
                   onClick={() =>
                     handleCreateTab({
                       name: pou.name,
@@ -234,7 +234,8 @@ const Project = () => {
                   key={pou.name}
                   leafLang={pou.body.language as PouLeafLang}
                   leafType='function-block'
-                  label={searchQuery ? extractSearchQuery(pou.name, searchQuery) : pou.name}
+                  label={pou.name}
+                  highlightQuery={searchQuery}
                   onClick={() =>
                     handleCreateTab({
                       name: pou.name,
@@ -258,7 +259,8 @@ const Project = () => {
                     key={pou.name}
                     leafLang={pou.body.language as PouLeafLang}
                     leafType='program'
-                    label={searchQuery ? extractSearchQuery(pou.name, searchQuery) : pou.name}
+                    label={pou.name}
+                    highlightQuery={searchQuery}
                     onClick={() =>
                       handleCreateTab({
                         name: pou.name,
@@ -281,7 +283,8 @@ const Project = () => {
                   key={name}
                   leafLang='arr'
                   leafType='data-type'
-                  label={searchQuery ? extractSearchQuery(name, searchQuery) : name}
+                  label={name}
+                  highlightQuery={searchQuery}
                   onClick={() =>
                     handleCreateTab({
                       name,
@@ -299,7 +302,8 @@ const Project = () => {
                   key={name}
                   leafLang='enum'
                   leafType='data-type'
-                  label={searchQuery ? extractSearchQuery(name, searchQuery) : name}
+                  label={name}
+                  highlightQuery={searchQuery}
                   /** Todo: Update the tab state */
                   onClick={() =>
                     handleCreateTab({
@@ -318,7 +322,8 @@ const Project = () => {
                   key={name}
                   leafLang='str'
                   leafType='data-type'
-                  label={searchQuery ? extractSearchQuery(name, searchQuery) : name}
+                  label={name}
+                  highlightQuery={searchQuery}
                   /** Todo: Update the tab state */
                   onClick={() =>
                     handleCreateTab({
@@ -432,7 +437,8 @@ const Project = () => {
                     key={server.name}
                     leafLang='server'
                     leafType='server'
-                    label={searchQuery ? extractSearchQuery(server.name, searchQuery) : server.name}
+                    label={server.name}
+                    highlightQuery={searchQuery}
                     onClick={() =>
                       handleCreateTab({
                         name: server.name,
@@ -456,7 +462,8 @@ const Project = () => {
                       key={device.name}
                       leafLang='remoteDevice'
                       leafType='remote-device'
-                      label={searchQuery ? extractSearchQuery(device.name, searchQuery) : device.name}
+                      label={device.name}
+                      highlightQuery={searchQuery}
                       onClick={() =>
                         handleCreateTab({
                           name: device.name,
@@ -472,7 +479,8 @@ const Project = () => {
                           leafType='ethercat-device'
                           busName={device.name}
                           deviceId={child.id}
-                          label={searchQuery ? extractSearchQuery(child.name, searchQuery) : child.name}
+                          label={child.name}
+                          highlightQuery={searchQuery}
                           onClick={() =>
                             handleCreateTab({
                               name: child.name,
@@ -488,7 +496,8 @@ const Project = () => {
                       key={device.name}
                       leafLang='remoteDevice'
                       leafType='remote-device'
-                      label={searchQuery ? extractSearchQuery(device.name, searchQuery) : device.name}
+                      label={device.name}
+                      highlightQuery={searchQuery}
                       onClick={() =>
                         handleCreateTab({
                           name: device.name,