diff --git a/src/lib/terminal-syntax-highlighter.ts b/src/lib/terminal-syntax-highlighter.ts
new file mode 100644
index 00000000..26fb29fa
--- /dev/null
+++ b/src/lib/terminal-syntax-highlighter.ts
@@ -0,0 +1,338 @@
+/**
+ * Terminal Syntax Highlighter
+ *
+ * Adds syntax highlighting to terminal output by injecting ANSI color codes
+ * for common patterns like commands, paths, IPs, log levels, and keywords.
+ *
+ * Features:
+ * - Preserves existing ANSI codes from SSH output
+ * - Performance-optimized for streaming logs
+ * - Priority-based pattern matching to avoid overlaps
+ * - Configurable via localStorage
+ */
+
+// ANSI escape code constants
+const ANSI_CODES = {
+  reset: "\x1b[0m",
+  colors: {
+    red: "\x1b[31m",
+    green: "\x1b[32m",
+    yellow: "\x1b[33m",
+    blue: "\x1b[34m",
+    magenta: "\x1b[35m",
+    cyan: "\x1b[36m",
+    white: "\x1b[37m",
+    brightBlack: "\x1b[90m", // Gray
+    brightRed: "\x1b[91m",
+    brightGreen: "\x1b[92m",
+    brightYellow: "\x1b[93m",
+    brightBlue: "\x1b[94m",
+    brightMagenta: "\x1b[95m",
+    brightCyan: "\x1b[96m",
+    brightWhite: "\x1b[97m",
+  },
+  styles: {
+    bold: "\x1b[1m",
+    dim: "\x1b[2m",
+    italic: "\x1b[3m",
+    underline: "\x1b[4m",
+  },
+} as const;
+
+// Pattern definition interface
+interface HighlightPattern {
+  name: string;
+  regex: RegExp;
+  ansiCode: string;
+  priority: number;
+  quickCheck?: string; // Optional fast string.includes() check
+}
+
+// Match result interface for tracking ranges
+interface MatchResult {
+  start: number;
+  end: number;
+  ansiCode: string;
+  priority: number;
+}
+
+// Configuration
+const MAX_LINE_LENGTH = 5000; // Skip highlighting for very long lines
+const MAX_ANSI_CODES = 10; // Skip if text has many ANSI codes (likely already colored/interactive app)
+
+// Pattern definitions by category (pre-compiled)
+// Based on SecureCRT proven patterns with strict boundaries
+const PATTERNS: HighlightPattern[] = [
+  // Priority 1: IP Addresses (HIGHEST - from SecureCRT line 94)
+  // Matches: 192.168.1.1, 10.0.0.5, 127.0.0.1:8080
+  // WON'T match: dates like "2025" or "03:11:36"
+  {
+    name: "ipv4",
+    regex:
+      /(?:(?:25[0-5]|2[0-4][0-9]|1[0-9][0-9]|[1-9]?[0-9])\.){3}(?:25[0-5]|2[0-4][0-9]|1[0-9][0-9]|[1-9]?[0-9])(?::\d{1,5})?/g,
+    ansiCode: ANSI_CODES.colors.magenta,
+    priority: 10,
+  },
+
+  // Priority 2: Log Levels - Error (bright red)
+  {
+    name: "log-error",
+    regex:
+      /\b(ERROR|FATAL|CRITICAL|FAIL(?:ED)?|denied|invalid|DENIED)\b|\[ERROR\]/gi,
+    ansiCode: ANSI_CODES.colors.brightRed,
+    priority: 9,
+  },
+
+  // Priority 3: Log Levels - Warning (yellow)
+  {
+    name: "log-warn",
+    regex: /\b(WARN(?:ING)?|ALERT)\b|\[WARN(?:ING)?\]/gi,
+    ansiCode: ANSI_CODES.colors.yellow,
+    priority: 9,
+  },
+
+  // Priority 4: Log Levels - Success (bright green)
+  {
+    name: "log-success",
+    regex:
+      /\b(SUCCESS|OK|PASS(?:ED)?|COMPLETE(?:D)?|connected|active|up|Up|UP|FULL)\b/gi,
+    ansiCode: ANSI_CODES.colors.brightGreen,
+    priority: 8,
+  },
+
+  // Priority 5: URLs (must start with http/https)
+  {
+    name: "url",
+    regex: /https?:\/\/[^\s\])}]+/g,
+    ansiCode: `${ANSI_CODES.colors.blue}${ANSI_CODES.styles.underline}`,
+    priority: 8,
+  },
+
+  // Priority 6: Absolute paths - STRICT (must have 2+ segments)
+  // Matches: /var/log/file.log, /home/user/docs
+  // WON'T match: /03, /2025, single segments
+  {
+    name: "path-absolute",
+    regex: /\/[a-zA-Z][a-zA-Z0-9_\-@.]*(?:\/[a-zA-Z0-9_\-@.]+)+/g,
+    ansiCode: ANSI_CODES.colors.cyan,
+    priority: 7,
+  },
+
+  // Priority 7: Home paths
+  {
+    name: "path-home",
+    regex: /~\/[a-zA-Z0-9_\-@./]+/g,
+    ansiCode: ANSI_CODES.colors.cyan,
+    priority: 7,
+  },
+
+  // Priority 8: Other log levels
+  {
+    name: "log-info",
+    regex: /\bINFO\b|\[INFO\]/gi,
+    ansiCode: ANSI_CODES.colors.blue,
+    priority: 6,
+  },
+  {
+    name: "log-debug",
+    regex: /\b(?:DEBUG|TRACE)\b|\[(?:DEBUG|TRACE)\]/gi,
+    ansiCode: ANSI_CODES.colors.brightBlack,
+    priority: 6,
+  },
+];
+
+/**
+ * Check if text contains existing ANSI escape sequences
+ */
+function hasExistingAnsiCodes(text: string): boolean {
+  // Count all ANSI escape sequences (not just CSI)
+  const ansiCount = (
+    text.match(
+      /\x1b[\[\]()#;?]*(?:[0-9]{1,4}(?:;[0-9]{0,4})*)?[0-9A-PRZcf-nq-uy=><~]/g,
+    ) || []
+  ).length;
+  return ansiCount > MAX_ANSI_CODES;
+}
+
+/**
+ * Check if text appears to be incomplete (partial ANSI sequence at end)
+ */
+function hasIncompleteAnsiSequence(text: string): boolean {
+  // Check if text ends with incomplete ANSI escape sequence
+  return /\x1b(?:\[(?:[0-9;]*)?)?$/.test(text);
+}
+
+/**
+ * Parse text into segments: plain text and ANSI codes
+ */
+interface TextSegment {
+  isAnsi: boolean;
+  content: string;
+}
+
+function parseAnsiSegments(text: string): TextSegment[] {
+  const segments: TextSegment[] = [];
+  // More comprehensive ANSI regex - matches SGR (colors), cursor movement, erase sequences, etc.
+  const ansiRegex = /\x1b(?:[@-Z\\-_]|\[[0-9;]*[@-~])/g;
+  let lastIndex = 0;
+  let match;
+
+  while ((match = ansiRegex.exec(text)) !== null) {
+    // Plain text before ANSI code
+    if (match.index > lastIndex) {
+      segments.push({
+        isAnsi: false,
+        content: text.slice(lastIndex, match.index),
+      });
+    }
+
+    // ANSI code itself
+    segments.push({
+      isAnsi: true,
+      content: match[0],
+    });
+
+    lastIndex = ansiRegex.lastIndex;
+  }
+
+  // Remaining plain text
+  if (lastIndex < text.length) {
+    segments.push({
+      isAnsi: false,
+      content: text.slice(lastIndex),
+    });
+  }
+
+  return segments;
+}
+
+/**
+ * Apply highlights to plain text (no ANSI codes)
+ */
+function highlightPlainText(text: string): string {
+  // Skip very long lines for performance
+  if (text.length > MAX_LINE_LENGTH) {
+    return text;
+  }
+
+  // Skip if text is empty or whitespace
+  if (!text.trim()) {
+    return text;
+  }
+
+  // Find all matches for all patterns
+  const matches: MatchResult[] = [];
+
+  for (const pattern of PATTERNS) {
+    // Reset regex lastIndex
+    pattern.regex.lastIndex = 0;
+
+    let match;
+    while ((match = pattern.regex.exec(text)) !== null) {
+      matches.push({
+        start: match.index,
+        end: match.index + match[0].length,
+        ansiCode: pattern.ansiCode,
+        priority: pattern.priority,
+      });
+    }
+  }
+
+  // If no matches, return original text
+  if (matches.length === 0) {
+    return text;
+  }
+
+  // Sort matches by priority (descending) then by position
+  matches.sort((a, b) => {
+    if (a.priority !== b.priority) {
+      return b.priority - a.priority;
+    }
+    return a.start - b.start;
+  });
+
+  // Filter out overlapping matches (keep higher priority)
+  const appliedRanges: Array<{ start: number; end: number }> = [];
+  const finalMatches = matches.filter((match) => {
+    const overlaps = appliedRanges.some(
+      (range) =>
+        (match.start >= range.start && match.start < range.end) ||
+        (match.end > range.start && match.end <= range.end) ||
+        (match.start <= range.start && match.end >= range.end),
+    );
+
+    if (!overlaps) {
+      appliedRanges.push({ start: match.start, end: match.end });
+      return true;
+    }
+    return false;
+  });
+
+  // Apply ANSI codes from end to start (to preserve indices)
+  let result = text;
+  finalMatches.reverse().forEach((match) => {
+    const before = result.slice(0, match.start);
+    const matched = result.slice(match.start, match.end);
+    const after = result.slice(match.end);
+
+    result = before + match.ansiCode + matched + ANSI_CODES.reset + after;
+  });
+
+  return result;
+}
+
+/**
+ * Main export: Highlight terminal output text
+ *
+ * @param text - Terminal output text (may contain ANSI codes)
+ * @returns Text with syntax highlighting applied
+ */
+export function highlightTerminalOutput(text: string): string {
+  // Early exit for empty or whitespace-only text
+  if (!text || !text.trim()) {
+    return text;
+  }
+
+  // Skip highlighting if text has incomplete ANSI sequence (streaming chunk)
+  if (hasIncompleteAnsiSequence(text)) {
+    return text;
+  }
+
+  // Skip highlighting if text already has many ANSI codes
+  // (likely already styled by SSH output or application)
+  if (hasExistingAnsiCodes(text)) {
+    return text;
+  }
+
+  // Parse text into segments (plain text vs ANSI codes)
+  const segments = parseAnsiSegments(text);
+
+  // If no ANSI codes found, highlight entire text
+  if (segments.length === 0) {
+    return highlightPlainText(text);
+  }
+
+  // Highlight only plain text segments, preserve ANSI segments
+  const highlightedSegments = segments.map((segment) => {
+    if (segment.isAnsi) {
+      return segment.content; // Preserve existing ANSI codes
+    } else {
+      return highlightPlainText(segment.content);
+    }
+  });
+
+  return highlightedSegments.join("");
+}
+
+/**
+ * Check if syntax highlighting is enabled in localStorage
+ * Defaults to false if not set (opt-in behavior - BETA feature)
+ */
+export function isSyntaxHighlightingEnabled(): boolean {
+  try {
+    return localStorage.getItem("terminalSyntaxHighlighting") === "true";
+  } catch {
+    // If localStorage is not available, default to disabled
+    return false;
+  }
+}
diff --git a/src/ui/desktop/apps/terminal/Terminal.tsx b/src/ui/desktop/apps/terminal/Terminal.tsx
index fb56c95a..1512fcce 100644
--- a/src/ui/desktop/apps/terminal/Terminal.tsx
+++ b/src/ui/desktop/apps/terminal/Terminal.tsx
@@ -28,6 +28,7 @@ import {
 } from "@/constants/terminal-themes";
 import type { TerminalConfig } from "@/types";
 import { useCommandTracker } from "@/ui/hooks/useCommandTracker";
+import { highlightTerminalOutput } from "@/lib/terminal-syntax-highlighter.ts";
 import { useCommandHistory as useCommandHistoryHook } from "@/ui/hooks/useCommandHistory";
 import { useCommandHistory } from "@/ui/desktop/apps/terminal/command-history/CommandHistoryContext.tsx";
 import { CommandAutocomplete } from "./command-history/CommandAutocomplete.tsx";
@@ -662,7 +663,15 @@ export const Terminal = forwardRef<TerminalHandle, SSHTerminalProps>(
           const msg = JSON.parse(event.data);
           if (msg.type === "data") {
             if (typeof msg.data === "string") {
-              terminal.write(msg.data);
+              // Apply syntax highlighting if enabled (BETA - defaults to false/off)
+              const syntaxHighlightingEnabled =
+                localStorage.getItem("terminalSyntaxHighlighting") === "true";
+
+              const outputData = syntaxHighlightingEnabled
+                ? highlightTerminalOutput(msg.data)
+                : msg.data;
+
+              terminal.write(outputData);
               // Sudo password prompt detection
               const sudoPasswordPattern =
                 /(?:\[sudo\] password for \S+:|sudo: a password is required)/;
@@ -699,7 +708,16 @@ export const Terminal = forwardRef<TerminalHandle, SSHTerminalProps>(
                 }, 15000);
               }
             } else {
-              terminal.write(String(msg.data));
+              // Apply syntax highlighting to non-string data as well (BETA - defaults to false/off)
+              const syntaxHighlightingEnabled =
+                localStorage.getItem("terminalSyntaxHighlighting") === "true";
+
+              const stringData = String(msg.data);
+              const outputData = syntaxHighlightingEnabled
+                ? highlightTerminalOutput(stringData)
+                : stringData;
+
+              terminal.write(outputData);
             }
           } else if (msg.type === "error") {
             const errorMessage = msg.message || t("terminal.unknownError");
diff --git a/src/ui/desktop/user/UserProfile.tsx b/src/ui/desktop/user/UserProfile.tsx
index ee373c22..ee56c8f2 100644
--- a/src/ui/desktop/user/UserProfile.tsx
+++ b/src/ui/desktop/user/UserProfile.tsx
@@ -103,6 +103,10 @@ export function UserProfile({
   const [commandAutocomplete, setCommandAutocomplete] = useState<boolean>(
     localStorage.getItem("commandAutocomplete") === "true",
   );
+  const [terminalSyntaxHighlighting, setTerminalSyntaxHighlighting] =
+    useState<boolean>(
+      () => localStorage.getItem("terminalSyntaxHighlighting") === "true",
+    );
   const [defaultSnippetFoldersCollapsed, setDefaultSnippetFoldersCollapsed] =
     useState<boolean>(
       localStorage.getItem("defaultSnippetFoldersCollapsed") !== "false",
@@ -174,6 +178,12 @@ export function UserProfile({
     localStorage.setItem("commandAutocomplete", enabled.toString());
   };
 
+  const handleTerminalSyntaxHighlightingToggle = (enabled: boolean) => {
+    setTerminalSyntaxHighlighting(enabled);
+    localStorage.setItem("terminalSyntaxHighlighting", enabled.toString());
+    window.dispatchEvent(new Event("terminalSyntaxHighlightingChanged"));
+  };
+
   const handleDefaultSnippetFoldersCollapsedToggle = (enabled: boolean) => {
     setDefaultSnippetFoldersCollapsed(enabled);
     localStorage.setItem("defaultSnippetFoldersCollapsed", enabled.toString());
@@ -485,6 +495,24 @@ export function UserProfile({
                         onCheckedChange={handleCommandAutocompleteToggle}
                       />
                     </div>
+                    <div className="flex items-center justify-between">
+                      <div>
+                        <Label className="text-gray-300">
+                          Terminal Syntax Highlighting{" "}
+                          <span className="text-xs text-yellow-500 font-semibold">
+                            (BETA)
+                          </span>
+                        </Label>
+                        <p className="text-sm text-gray-400 mt-1">
+                          Automatically highlight commands, paths, IPs, and log
+                          levels in terminal output
+                        </p>
+                      </div>
+                      <Switch
+                        checked={terminalSyntaxHighlighting}
+                        onCheckedChange={handleTerminalSyntaxHighlightingToggle}
+                      />
+                    </div>
                   </div>
                 </div>