diff --git a/packages/playwright-core/src/server/injected/highlight.ts b/packages/playwright-core/src/server/injected/highlight.ts
index c89df54a6f..c06e58f529 100644
--- a/packages/playwright-core/src/server/injected/highlight.ts
+++ b/packages/playwright-core/src/server/injected/highlight.ts
@@ -287,7 +287,7 @@ export class Highlight {
     return this._injectedScript.document.createElement('x-pw-highlight');
   }
 
-  appendChild(element: HTMLElement) {
+  appendChild(element: Element) {
     this._glassPaneShadow.appendChild(element);
   }
 }
diff --git a/packages/playwright-core/src/server/injected/recorder/recorder.ts b/packages/playwright-core/src/server/injected/recorder/recorder.ts
index c82f55c984..7c38c6386e 100644
--- a/packages/playwright-core/src/server/injected/recorder/recorder.ts
+++ b/packages/playwright-core/src/server/injected/recorder/recorder.ts
@@ -825,7 +825,6 @@ class Overlay {
     this._recorder = recorder;
     const document = this._recorder.document;
     this._overlayElement = document.createElement('x-pw-overlay');
-    this._overlayElement.appendChild(createSvgElement(this._recorder.document, clipPaths));
     const toolsListElement = document.createElement('x-pw-tools-list');
     this._overlayElement.appendChild(toolsListElement);
 
@@ -1094,6 +1093,7 @@ export class Recorder {
     recreationInterval = this.injectedScript.builtinSetTimeout(recreate, 500);
     this._listeners.push(() => clearInterval(recreationInterval));
 
+    this.highlight.appendChild(createSvgElement(this.document, clipPaths));
     this.overlay?.install();
     this.document.adoptedStyleSheets.push(this._stylesheet);
   }
diff --git a/tests/library/inspector/cli-codegen-3.spec.ts b/tests/library/inspector/cli-codegen-3.spec.ts
index ddc44914b9..a57e7d5405 100644
--- a/tests/library/inspector/cli-codegen-3.spec.ts
+++ b/tests/library/inspector/cli-codegen-3.spec.ts
@@ -810,6 +810,19 @@ await page.GetByLabel("Coun\\"try").ClickAsync();`);
     await expect(recorder.page.getByText('Post-Hydration Content')).toBeVisible();
     await expect(recorder.page.locator('x-pw-glass')).toBeVisible();
   });
+
+  test('should display inline svg icons on text assertion dialog inside iframe', async ({ openRecorder, server }) => {
+    const { page, recorder } = await openRecorder();
+    await recorder.page.click('x-pw-tool-item.text');
+
+    const { frameHello1 } = await createFrameHierarchy(page, recorder, server);
+    await recorder.trustedMove(frameHello1.locator('div'));
+    await recorder.trustedClick();
+
+    const glassPane = frameHello1.locator('x-pw-glass');
+    await expect(glassPane.locator('> x-pw-dialog .accept > x-div').evaluate(elem => getComputedStyle(elem).clipPath)).resolves.toBe('url("#icon-check")');
+    await expect(glassPane.locator('> svg > defs > clipPath#icon-check')).toBeAttached();
+  });
 });
 
 async function createFrameHierarchy(page: Page, recorder: Recorder, server: TestServer) {
diff --git a/tests/library/inspector/inspectorTest.ts b/tests/library/inspector/inspectorTest.ts
index d77ad86697..a90f73fcdf 100644
--- a/tests/library/inspector/inspectorTest.ts
+++ b/tests/library/inspector/inspectorTest.ts
@@ -15,7 +15,7 @@
  */
 
 import { contextTest } from '../../config/browserTest';
-import type { Page } from 'playwright-core';
+import type { Locator, Page } from 'playwright-core';
 import { step } from '../../config/baseTest';
 import * as path from 'path';
 import type { Source } from '../../../packages/recorder/src/recorderTypes';
@@ -209,8 +209,9 @@ export class Recorder {
     });
   }
 
-  async trustedMove(selector: string) {
-    const box = await this.page.locator(selector).first().boundingBox();
+  async trustedMove(selector: string | Locator) {
+    const locator = typeof selector === 'string' ? this.page.locator(selector).first() : selector;
+    const box = await locator.boundingBox();
     await this.page.mouse.move(box.x + box.width / 2, box.y + box.height / 2);
   }
 
diff --git a/tests/library/trace-viewer.spec.ts b/tests/library/trace-viewer.spec.ts
index 0eda4b092a..aa794eb716 100644
--- a/tests/library/trace-viewer.spec.ts
+++ b/tests/library/trace-viewer.spec.ts
@@ -431,7 +431,7 @@ test('should capture data-url svg iframe', async ({ page, server, runAndTrace })
 
   // Render snapshot, check expectations.
   const snapshotFrame = await traceViewer.snapshotFrame('page.evaluate', 0, true);
-  await expect(snapshotFrame.frameLocator('iframe').locator('svg')).toBeVisible();
+  await expect(snapshotFrame.frameLocator('iframe').locator('> body > svg')).toBeVisible();
   const content = await snapshotFrame.frameLocator('iframe').locator(':root').innerHTML();
   expect(content).toContain(`d="M16.5 3c-1.74 0-3.41.81-4.5 2.09C10.91 3.81 9.24 3 7.5 3 4.42 3 2 5.42 2 8.5c0 3.78 3.4 6.86 8.55 11.54L12 21.35l1.45-1.32C18.6 15.36 22 12.28 22 8.5 22 5.42 19.58 3 16.5 3zm-4.4 15.55l-.1.1-.1-.1C7.14 14.24 4 11.39 4 8.5 4 6.5 5.5 5 7.5 5c1.54 0 3.04.99 3.57 2.36h1.87C13.46 5.99 14.96 5 16.5 5c2 0 3.5 1.5 3.5 3.5 0 2.89-3.14 5.74-7.9 10.05z"`);
 });