diff --git a/frontend/app.js b/frontend/app.js
index 1c08349..0043698 100644
--- a/frontend/app.js
+++ b/frontend/app.js
@@ -59,6 +59,7 @@ function noteApp() {
         expandedFolders: new Set(),
         draggedNote: null,
         draggedFolder: null,
+        dragOverFolder: null,  // Track which folder is being hovered during drag
         
         // Scroll sync state
         isScrolling: false,
@@ -441,15 +442,25 @@ function noteApp() {
                     <div 
                         draggable="true"
                         x-data="{}"
-                        @dragstart="onFolderDragStart('${folder.path.replace(/'/g, "\\'")}' )"
+                        @dragstart="onFolderDragStart('${folder.path.replace(/'/g, "\\'")}', $event)"
                         @dragend="onFolderDragEnd()"
-                        @dragover.prevent
-                        @drop.stop="onFolderDrop('${folder.path.replace(/'/g, "\\'")}')"
-                        class="folder-item px-2 py-2 mb-1 text-sm rounded transition-all relative"
+                        @dragover.prevent="dragOverFolder = '${folder.path.replace(/'/g, "\\'")}'"
+                        @dragenter.prevent="dragOverFolder = '${folder.path.replace(/'/g, "\\'")}'"
+                        @dragleave="dragOverFolder = null"
+                        @drop.stop="onFolderDrop('${folder.path.replace(/'/g, "\\'")}' )"
+                        class="folder-item px-3 py-3 mb-1 text-sm rounded transition-all relative"
                         style="color: var(--text-primary); cursor: pointer;"
-                        :class="draggedNote || draggedFolder ? 'border-2 border-dashed border-accent-primary bg-accent-light' : 'border-2 border-transparent'"
+                        :class="{
+                            'border-2 border-dashed bg-accent-light': (draggedNote || draggedFolder) && dragOverFolder === '${folder.path.replace(/'/g, "\\'")}',
+                            'border-2 border-dashed': (draggedNote || draggedFolder) && dragOverFolder !== '${folder.path.replace(/'/g, "\\'")}',
+                            'border-2 border-transparent': !draggedNote && !draggedFolder
+                        }"
+                        :style="{
+                            'border-color': (draggedNote || draggedFolder) && dragOverFolder === '${folder.path.replace(/'/g, "\\'")}'  ? 'var(--accent-primary)' : 'var(--border-secondary)',
+                            'background-color': dragOverFolder === '${folder.path.replace(/'/g, "\\'")}'  ? 'var(--accent-light)' : ''
+                        }"
                         @mouseover="if(!draggedNote && !draggedFolder) $el.style.backgroundColor='var(--bg-hover)'"
-                        @mouseout="if(!draggedNote && !draggedFolder) $el.style.backgroundColor='transparent'"
+                        @mouseout="if(!draggedNote && !draggedFolder && dragOverFolder !== '${folder.path.replace(/'/g, "\\'")}'  ) $el.style.backgroundColor='transparent'"
                         @click="toggleFolder('${folder.path.replace(/'/g, "\\'")}')"
                     >
                         <div class="flex items-center gap-1">
@@ -665,12 +676,21 @@ function noteApp() {
                 // Move mode: drag to move note
                 this.draggedNote = notePath;
                 event.dataTransfer.effectAllowed = 'move';
+                // Make drag image semi-transparent
+                if (event.target) {
+                    event.target.style.opacity = '0.5';
+                }
             }
         },
         
         onNoteDragEnd() {
             this.draggedNote = null;
             this.draggedNoteForLink = null;
+            this.dragOverFolder = null;
+            // Reset opacity of all note items
+            document.querySelectorAll('.note-item').forEach(el => {
+                el.style.opacity = '1';
+            });
         },
         
         // Handle dragover on editor to show cursor position
@@ -776,12 +796,21 @@ function noteApp() {
         },
         
         // Folder drag handlers
-        onFolderDragStart(folderPath) {
+        onFolderDragStart(folderPath, event) {
             this.draggedFolder = folderPath;
+            // Make drag image semi-transparent
+            if (event && event.target) {
+                event.target.style.opacity = '0.5';
+            }
         },
         
         onFolderDragEnd() {
             this.draggedFolder = null;
+            this.dragOverFolder = null;
+            // Reset opacity of all folder items
+            document.querySelectorAll('.folder-item').forEach(el => {
+                el.style.opacity = '1';
+            });
         },
         
         async onFolderDrop(targetFolderPath) {
diff --git a/frontend/index.html b/frontend/index.html
index c4e1030..766a701 100644
--- a/frontend/index.html
+++ b/frontend/index.html
@@ -350,6 +350,7 @@
         /* Folder tree styling */
         .folder-item {
             user-select: none;
+            transition: all 0.2s ease;
         }
         
         .folder-item:hover {
@@ -362,6 +363,29 @@
         
         .note-item {
             padding-left: 1.5rem;
+            transition: all 0.2s ease;
+        }
+        
+        /* Drag and drop improvements */
+        .note-item[draggable="true"],
+        .folder-item[draggable="true"] {
+            cursor: grab;
+        }
+        
+        .note-item[draggable="true"]:active,
+        .folder-item[draggable="true"]:active {
+            cursor: grabbing;
+        }
+        
+        /* Smooth transitions for drag states */
+        .folder-item,
+        .note-item {
+            transition: opacity 0.2s ease, transform 0.15s ease, background-color 0.15s ease, border-color 0.15s ease;
+        }
+        
+        /* Better drop zone visibility */
+        .folder-item:has(+ .folder-contents) {
+            position: relative;
         }
         
         .hover-buttons {
@@ -893,13 +917,19 @@
                         <!-- Root drop zone - only visible when dragging -->
                         <div 
                             x-show="draggedNote || draggedFolder"
-                            @dragover.prevent
+                            x-transition
+                            @dragover.prevent="dragOverFolder = '';"
+                            @dragenter.prevent="dragOverFolder = '';"
+                            @dragleave="dragOverFolder = null;"
                             @drop="onFolderDrop('')"
-                            class="mb-3 px-3 py-2 rounded-lg border-2 border-dashed transition-all"
-                            style="border-color: var(--accent-primary); background-color: var(--accent-light);"
+                            class="mb-3 px-4 py-3 rounded-lg border-2 border-dashed transition-all"
+                            :class="dragOverFolder === '' ? 'bg-accent-light' : ''"
+                            :style="dragOverFolder === '' ? 'border-color: var(--accent-primary); transform: scale(1.02);' : 'border-color: var(--border-primary);'"
                         >
-                            <div class="text-xs text-center font-medium" style="color: var(--accent-primary);">
-                                📂 Drop here to move to root folder
+                            <div class="text-sm text-center font-medium flex items-center justify-center gap-2" 
+                                 :style="dragOverFolder === '' ? 'color: var(--accent-primary);' : 'color: var(--text-secondary);'">
+                                <span>📂</span>
+                                <span>Drop here to move to root folder</span>
                             </div>
                         </div>