diff --git a/packages/cli/src/ui/components/shared/BaseSelectionList.test.tsx b/packages/cli/src/ui/components/shared/BaseSelectionList.test.tsx
index 8fffd4c5fc..d540fadf9a 100644
--- a/packages/cli/src/ui/components/shared/BaseSelectionList.test.tsx
+++ b/packages/cli/src/ui/components/shared/BaseSelectionList.test.tsx
@@ -12,10 +12,22 @@ import {
   type RenderItemContext,
 } from './BaseSelectionList.js';
 import { useSelectionList } from '../../hooks/useSelectionList.js';
-import { Text } from 'ink';
+import { Text, getBoundingBox } from 'ink';
 import type { theme } from '../../semantic-colors.js';
+import { useTerminalSize } from '../../hooks/useTerminalSize.js';
+import { useUIState, type UIState } from '../../contexts/UIStateContext.js';
 
 vi.mock('../../hooks/useSelectionList.js');
+vi.mock('../../hooks/useTerminalSize.js');
+vi.mock('../../contexts/UIStateContext.js');
+
+vi.mock('ink', async (importOriginal) => {
+  const actual = await importOriginal<typeof import('ink')>();
+  return {
+    ...actual,
+    getBoundingBox: vi.fn(),
+  };
+});
 
 const mockTheme = {
   text: { primary: 'COLOR_PRIMARY', secondary: 'COLOR_SECONDARY' },
@@ -57,6 +69,18 @@ describe('BaseSelectionList', () => {
       setActiveIndex: vi.fn(),
     });
 
+    vi.mocked(useTerminalSize).mockReturnValue({
+      columns: 100,
+      rows: 40,
+    });
+
+    vi.mocked(getBoundingBox).mockReturnValue({
+      width: 100,
+      height: 10,
+      x: 0,
+      y: 0,
+    });
+
     mockRenderItem.mockImplementation(
       (
         item: { value: string; label: string; disabled?: boolean; key: string },
@@ -82,6 +106,9 @@ describe('BaseSelectionList', () => {
 
   beforeEach(() => {
     vi.clearAllMocks();
+    vi.mocked(useUIState).mockReturnValue({
+      mainAreaWidth: 100,
+    } as unknown as UIState);
   });
 
   describe('Rendering and Structure', () => {
@@ -92,7 +119,8 @@ describe('BaseSelectionList', () => {
       expect(lastFrame()).toContain('Item B');
       expect(lastFrame()).toContain('Item C');
 
-      expect(mockRenderItem).toHaveBeenCalledTimes(3);
+      // 3 items. Render count might be higher due to useLayoutEffect for offset.
+      expect(mockRenderItem).toHaveBeenCalledTimes(items.length);
       expect(mockRenderItem).toHaveBeenCalledWith(items[0], expect.any(Object));
       unmount();
     });
@@ -496,6 +524,37 @@ describe('BaseSelectionList', () => {
       unmount();
     });
 
+    it('should apply full-width highlight and offset when horizontally shifted', async () => {
+      const horizontalOffset = 10;
+      const terminalWidth = 100;
+
+      vi.mocked(getBoundingBox).mockReturnValue({
+        width: 80,
+        height: 10,
+        x: horizontalOffset,
+        y: 0,
+      });
+
+      vi.mocked(useTerminalSize).mockReturnValue({
+        columns: terminalWidth,
+        rows: 40,
+      });
+
+      const { lastFrame, unmount, waitUntilReady } = await renderComponent(
+        {},
+        0,
+      ); // Item A selected
+      await waitUntilReady();
+
+      const output = lastFrame();
+      expect(output).toContain('Item A');
+
+      // Since we can't easily inspect Box props from lastFrame(),
+      // this test confirms it doesn't crash and renders correctly.
+      // In a real scenario, we'd use a custom renderer or inspect the tree if possible.
+      unmount();
+    });
+
     it('should show arrows and correct items when scrolled to the middle', async () => {
       const { lastFrame, unmount } = await renderComponent(
         { items: longList, maxItemsToShow: MAX_ITEMS, showScrollArrows: true },
diff --git a/packages/cli/src/ui/components/shared/BaseSelectionList.tsx b/packages/cli/src/ui/components/shared/BaseSelectionList.tsx
index 1467bb357e..172fd0b076 100644
--- a/packages/cli/src/ui/components/shared/BaseSelectionList.tsx
+++ b/packages/cli/src/ui/components/shared/BaseSelectionList.tsx
@@ -5,10 +5,12 @@
  */
 
 import type React from 'react';
-import { useEffect, useState } from 'react';
-import { Text, Box } from 'ink';
+import { useEffect, useState, useLayoutEffect, useRef } from 'react';
+import { Text, Box, getBoundingBox, type DOMElement } from 'ink';
 import { theme } from '../../semantic-colors.js';
 import { useSelectionList } from '../../hooks/useSelectionList.js';
+import { useTerminalSize } from '../../hooks/useTerminalSize.js';
+import { useUIState } from '../../contexts/UIStateContext.js';
 
 import type { SelectionListItem } from '../../hooks/useSelectionList.js';
 
@@ -80,6 +82,25 @@ export function BaseSelectionList<
   });
 
   const [scrollOffset, setScrollOffset] = useState(0);
+  const containerRef = useRef<DOMElement>(null);
+  const [horizontalOffset, setHorizontalOffset] = useState(0);
+  const { columns: terminalWidth } = useTerminalSize();
+  const uiState = useUIState();
+  const mainAreaWidth = uiState?.mainAreaWidth;
+  const effectiveTerminalWidth = mainAreaWidth ?? terminalWidth;
+
+  // Measure horizontal offset to allow full-width highlight
+  useLayoutEffect(() => {
+    if (containerRef.current) {
+      const { x } = getBoundingBox(containerRef.current);
+      // We want to track the "true" offset relative to the viewport.
+      // Since we apply -breakoutAmount as a margin to the SELECTED item,
+      // it should not affect the parent container's x coordinate in a standard layout.
+      if (x !== horizontalOffset) {
+        setHorizontalOffset(x);
+      }
+    }
+  }, [terminalWidth, mainAreaWidth, horizontalOffset]);
 
   // Handle scrolling for long lists
   useEffect(() => {
@@ -98,7 +119,7 @@ export function BaseSelectionList<
   const numberColumnWidth = String(items.length).length;
 
   return (
-    <Box flexDirection="column">
+    <Box flexDirection="column" ref={containerRef}>
       {/* Use conditional coloring instead of conditional rendering */}
       {showScrollArrows && items.length > maxItemsToShow && (
         <Text
@@ -136,11 +157,20 @@ export function BaseSelectionList<
           numberColumnWidth,
         )}.`;
 
+        const breakoutAmount = isSelected
+          ? Math.max(0, horizontalOffset - 2)
+          : 0;
+
         return (
           <Box
             key={item.key}
             alignItems="flex-start"
             backgroundColor={isSelected ? theme.background.focus : undefined}
+            marginLeft={-breakoutAmount}
+            paddingLeft={breakoutAmount}
+            width={
+              isSelected ? Math.max(1, effectiveTerminalWidth - 4) : '100%'
+            }
           >
             {/* Radio button indicator */}
             <Box minWidth={2} flexShrink={0}>
diff --git a/packages/cli/src/ui/components/shared/BaseSettingsDialog.tsx b/packages/cli/src/ui/components/shared/BaseSettingsDialog.tsx
index 05cef4fcf2..bacdecbfdf 100644
--- a/packages/cli/src/ui/components/shared/BaseSettingsDialog.tsx
+++ b/packages/cli/src/ui/components/shared/BaseSettingsDialog.tsx
@@ -524,12 +524,13 @@ export function BaseSettingsDialog({
               return (
                 <React.Fragment key={item.key}>
                   <Box
-                    marginX={1}
+                    marginX={isActive ? 0 : 1}
                     flexDirection="row"
                     alignItems="flex-start"
                     backgroundColor={
                       isActive ? theme.background.focus : undefined
                     }
+                    paddingX={isActive ? 1 : 0}
                   >
                     <Box minWidth={2} flexShrink={0}>
                       <Text
@@ -560,7 +561,12 @@ export function BaseSettingsDialog({
                             </Text>
                           )}
                         </Text>
-                        <Text color={theme.text.secondary} wrap="truncate">
+                        <Text
+                          color={
+                            isActive ? theme.text.primary : theme.text.secondary
+                          }
+                          wrap="truncate"
+                        >
                           {item.description ?? ''}
                         </Text>
                       </Box>