diff --git a/src/components/nodes/GenerateImageNode.tsx b/src/components/nodes/GenerateImageNode.tsx
index ce026212..9d57fa88 100644
--- a/src/components/nodes/GenerateImageNode.tsx
+++ b/src/components/nodes/GenerateImageNode.tsx
@@ -601,7 +601,7 @@ export function GenerateImageNode({ id, data, selected }: NodeProps<NanoBananaNo
         Image
       </div>
 
-      <div className="relative w-full h-full min-h-0 overflow-hidden rounded-lg">
+      <div className={`relative w-full h-full min-h-0 overflow-hidden ${inlineParametersEnabled && isParamsExpanded ? "rounded-t-lg" : "rounded-lg"}`}>
         {/* Preview area */}
         {nodeData.outputImage ? (
           <>
diff --git a/src/components/nodes/GenerateVideoNode.tsx b/src/components/nodes/GenerateVideoNode.tsx
index ce958f72..d1d8a5eb 100644
--- a/src/components/nodes/GenerateVideoNode.tsx
+++ b/src/components/nodes/GenerateVideoNode.tsx
@@ -659,7 +659,7 @@ export function GenerateVideoNode({ id, data, selected }: NodeProps<GenerateVide
         Video
       </div>
 
-      <div className="relative w-full h-full min-h-0 overflow-hidden rounded-lg">
+      <div className={`relative w-full h-full min-h-0 overflow-hidden ${inlineParametersEnabled && isParamsExpanded ? "rounded-t-lg" : "rounded-lg"}`}>
         {/* Preview area */}
         {nodeData.outputVideo ? (
           <>
diff --git a/src/components/nodes/InlineParameterPanel.tsx b/src/components/nodes/InlineParameterPanel.tsx
index 1ae809ce..46c32208 100644
--- a/src/components/nodes/InlineParameterPanel.tsx
+++ b/src/components/nodes/InlineParameterPanel.tsx
@@ -20,18 +20,19 @@ export function InlineParameterPanel({
   nodeId,
 }: InlineParameterPanelProps) {
   return (
-    <div className="w-full bg-[#1a1a1a]">
-      {/* Chevron toggle button */}
+    <div className="w-full">
+      {/* Settings toggle button — no background when collapsed, floats below node edge */}
       <button
         type="button"
         onClick={onToggle}
-        className="nodrag nopan w-full flex items-center justify-center py-1 text-neutral-500 hover:text-neutral-300 transition-colors"
+        className="nodrag nopan w-full flex items-center justify-center gap-1 py-1 text-neutral-500 hover:text-neutral-300 transition-colors"
         aria-label={expanded ? "Collapse parameters" : "Expand parameters"}
         aria-expanded={expanded}
         aria-controls={`params-${nodeId}`}
       >
+        <span className="text-[10px]">Settings</span>
         <svg
-          className="w-3.5 h-3.5 transition-transform duration-200"
+          className="w-3 h-3 transition-transform duration-200"
           style={{ transform: expanded ? "rotate(180deg)" : "rotate(0deg)" }}
           viewBox="0 0 24 24"
           fill="none"
@@ -53,7 +54,7 @@ export function InlineParameterPanel({
           opacity: expanded ? 1 : 0,
         }}
       >
-        <div className="nodrag nopan nowheel px-3 pb-3 rounded-b-lg">
+        <div className="nodrag nopan nowheel bg-[#1a1a1a] px-3 pt-2 pb-3 rounded-b-lg">
           <div className="space-y-1.5 max-w-[280px] mx-auto">{children}</div>
         </div>
       </div>
diff --git a/src/components/nodes/LLMGenerateNode.tsx b/src/components/nodes/LLMGenerateNode.tsx
index b1174415..190c3d6f 100644
--- a/src/components/nodes/LLMGenerateNode.tsx
+++ b/src/components/nodes/LLMGenerateNode.tsx
@@ -150,7 +150,7 @@ export function LLMGenerateNode({ id, data, selected }: NodeProps<LLMGenerateNod
         data-handletype="text"
       />
 
-      <div className="relative w-full h-full min-h-0 overflow-hidden rounded-lg">
+      <div className={`relative w-full h-full min-h-0 overflow-hidden ${inlineParametersEnabled && isParamsExpanded ? "rounded-t-lg" : "rounded-lg"}`}>
         {nodeData.status === "loading" ? (
           <div className="w-full h-full bg-neutral-900/40 flex items-center justify-center">
             <svg