diff --git a/packages/lexical/src/LexicalNode.ts b/packages/lexical/src/LexicalNode.ts
index ebe8d56b8ea..f1b1559b59c 100644
--- a/packages/lexical/src/LexicalNode.ts
+++ b/packages/lexical/src/LexicalNode.ts
@@ -15,6 +15,7 @@ import invariant from 'shared/invariant';
 
 import {
   $createParagraphNode,
+  $isDecoratorNode,
   $isElementNode,
   $isParagraphNode,
   $isRootNode,
@@ -281,14 +282,41 @@ export class LexicalNode {
     }
     // For inline images inside of element nodes.
     // Without this change the image will be selected if the cursor is before or after it.
-    if (
+    const isElementRangeSelection =
       $isRangeSelection(targetSelection) &&
       targetSelection.anchor.type === 'element' &&
-      targetSelection.focus.type === 'element' &&
-      targetSelection.anchor.key === targetSelection.focus.key &&
-      targetSelection.anchor.offset === targetSelection.focus.offset
-    ) {
-      return false;
+      targetSelection.focus.type === 'element';
+
+    if (isElementRangeSelection) {
+      if (targetSelection.isCollapsed()) {
+        return false;
+      }
+
+      const parentNode = this.getParent();
+      if ($isDecoratorNode(this) && this.isInline() && parentNode) {
+        const {anchor, focus} = targetSelection;
+
+        if (anchor.isBefore(focus)) {
+          const anchorNode = anchor.getNode() as ElementNode;
+          const isAnchorPointToLast =
+            anchor.offset === anchorNode.getChildrenSize();
+          const isAnchorNodeIsParent = anchorNode.is(parentNode);
+          const isLastChild = anchorNode.getLastChildOrThrow().is(this);
+
+          if (isAnchorPointToLast && isAnchorNodeIsParent && isLastChild) {
+            return false;
+          }
+        } else {
+          const focusNode = focus.getNode() as ElementNode;
+          const isFocusPointToLast =
+            focus.offset === focusNode.getChildrenSize();
+          const isFocusNodeIsParent = focusNode.is(parentNode);
+          const isLastChild = focusNode.getLastChildOrThrow().is(this);
+          if (isFocusPointToLast && isFocusNodeIsParent && isLastChild) {
+            return false;
+          }
+        }
+      }
     }
     return isSelected;
   }
diff --git a/packages/lexical/src/__tests__/unit/LexicalNode.test.ts b/packages/lexical/src/__tests__/unit/LexicalNode.test.ts
index 1f11b93b846..c34ad1a2643 100644
--- a/packages/lexical/src/__tests__/unit/LexicalNode.test.ts
+++ b/packages/lexical/src/__tests__/unit/LexicalNode.test.ts
@@ -10,6 +10,7 @@ import {
   $getRoot,
   $getSelection,
   $isRangeSelection,
+  DecoratorNode,
   ParagraphNode,
   TextNode,
 } from 'lexical';
@@ -47,6 +48,40 @@ class TestNode extends LexicalNode {
   }
 }
 
+class InlineDecoratorNode extends DecoratorNode<string> {
+  static getType(): string {
+    return 'inline-decorator';
+  }
+
+  static clone(): InlineDecoratorNode {
+    return new InlineDecoratorNode();
+  }
+
+  static importJSON() {
+    return new InlineDecoratorNode();
+  }
+
+  exportJSON() {
+    return {type: 'inline-decorator', version: 1};
+  }
+
+  createDOM(): HTMLElement {
+    return document.createElement('span');
+  }
+
+  isInline(): true {
+    return true;
+  }
+
+  isParentRequired(): true {
+    return true;
+  }
+
+  decorate() {
+    return 'inline-decorator';
+  }
+}
+
 // This is a hack to bypass the node type validation on LexicalNode. We never want to create
 // an LexicalNode directly but we're testing the base functionality in this module.
 LexicalNode.getType = function () {
@@ -266,6 +301,56 @@ describe('LexicalNode tests', () => {
         await Promise.resolve().then();
       });
 
+      test('LexicalNode.isSelected(): with inline decorator node', async () => {
+        const {editor} = testEnv;
+        let paragraphNode1: ParagraphNode;
+        let paragraphNode2: ParagraphNode;
+        let inlineDecoratorNode: InlineDecoratorNode;
+
+        editor.update(() => {
+          paragraphNode1 = $createParagraphNode();
+          paragraphNode2 = $createParagraphNode();
+          inlineDecoratorNode = new InlineDecoratorNode();
+          paragraphNode1.append(inlineDecoratorNode);
+          $getRoot().append(paragraphNode1, paragraphNode2);
+          paragraphNode1.selectEnd();
+          const selection = $getSelection();
+
+          if ($isRangeSelection(selection)) {
+            expect(selection.anchor.getNode().is(paragraphNode1)).toBe(true);
+          }
+        });
+
+        editor.update(() => {
+          const selection = $getSelection();
+          if ($isRangeSelection(selection)) {
+            expect(selection.anchor.key).toBe(paragraphNode1.getKey());
+
+            selection.focus.set(paragraphNode2.getKey(), 1, 'element');
+          }
+        });
+
+        await Promise.resolve().then();
+
+        editor.getEditorState().read(() => {
+          expect(inlineDecoratorNode.isSelected()).toBe(false);
+        });
+
+        editor.update(() => {
+          const selection = $getSelection();
+          if ($isRangeSelection(selection)) {
+            selection.anchor.set(paragraphNode2.getKey(), 0, 'element');
+            selection.focus.set(paragraphNode1.getKey(), 1, 'element');
+          }
+        });
+
+        await Promise.resolve().then();
+
+        editor.getEditorState().read(() => {
+          expect(inlineDecoratorNode.isSelected()).toBe(false);
+        });
+      });
+
       test('LexicalNode.getKey()', async () => {
         expect(textNode.getKey()).toEqual(textNode.__key);
       });
@@ -1206,7 +1291,7 @@ describe('LexicalNode tests', () => {
     },
     {
       namespace: '',
-      nodes: [LexicalNode, TestNode],
+      nodes: [LexicalNode, TestNode, InlineDecoratorNode],
       theme: {},
     },
   );