diff --git a/crates/bevy_ui/src/layout/convert.rs b/crates/bevy_ui/src/layout/convert.rs
index 2cc7c3b32c0f3..8a4a1ae95e449 100644
--- a/crates/bevy_ui/src/layout/convert.rs
+++ b/crates/bevy_ui/src/layout/convert.rs
@@ -66,7 +66,7 @@ impl UiRect {
 pub fn from_style(
     context: &LayoutContext,
     style: &Style,
-    ignore_padding_and_border: bool,
+    ignore_border: bool,
 ) -> taffy::style::Style {
     taffy::style::Style {
         display: style.display.into(),
@@ -93,18 +93,12 @@ pub fn from_style(
         margin: style
             .margin
             .map_to_taffy_rect(|m| m.into_length_percentage_auto(context)),
-        // Ignore padding for leaf nodes as it isn't implemented in the rendering engine.
-        // TODO: Implement rendering of padding for leaf nodes
-        padding: if ignore_padding_and_border {
-            taffy::Rect::zero()
-        } else {
-            style
-                .padding
-                .map_to_taffy_rect(|m| m.into_length_percentage(context))
-        },
+        padding: style
+            .padding
+            .map_to_taffy_rect(|m| m.into_length_percentage(context)),
         // Ignore border for leaf nodes as it isn't implemented in the rendering engine.
         // TODO: Implement rendering of border for leaf nodes
-        border: if ignore_padding_and_border {
+        border: if ignore_border {
             taffy::Rect::zero()
         } else {
             style
diff --git a/crates/bevy_ui/src/layout/mod.rs b/crates/bevy_ui/src/layout/mod.rs
index f74ef601319cb..803221af3a5bc 100644
--- a/crates/bevy_ui/src/layout/mod.rs
+++ b/crates/bevy_ui/src/layout/mod.rs
@@ -264,10 +264,16 @@ pub fn ui_layout_system(
             let Ok(layout) = ui_surface.get_layout(entity) else {
                 return;
             };
-            let layout_size =
-                inverse_target_scale_factor * Vec2::new(layout.size.width, layout.size.height);
-            let layout_location =
-                inverse_target_scale_factor * Vec2::new(layout.location.x, layout.location.y);
+            let layout_size = inverse_target_scale_factor
+                * Vec2::new(
+                    layout.size.width - layout.padding.left - layout.padding.right,
+                    layout.size.height - layout.padding.top - layout.padding.bottom,
+                );
+            let layout_location = inverse_target_scale_factor
+                * Vec2::new(
+                    layout.location.x + layout.padding.left,
+                    layout.location.y + layout.padding.top,
+                );
 
             absolute_location += layout_location;