diff --git a/decoder/hover.go b/decoder/hover.go
index 6db364d9..eb7e7af4 100644
--- a/decoder/hover.go
+++ b/decoder/hover.go
@@ -262,7 +262,10 @@ func (d *PathDecoder) hoverDataForExpr(expr hcl.Expression, constraints ExprCons
 		f, ok := d.pathCtx.Functions[e.Name]
 		if ok {
 			return &lang.HoverData{
-				Content: lang.Markdown(fmt.Sprintf("```hcl\n%s(%s) %s\n```\n\n%s", e.Name, f.ParameterSignature(), f.ReturnTypes.FriendlyName(), f.Description)),
+				// We could use a code block here, but the highlighting of type names
+				// conflicts with the naming of function parameters
+				// e.g. a parameter named list
+				Content: lang.Markdown(fmt.Sprintf("`%s(%s) %s`\n\n%s", e.Name, f.ParameterSignature(), f.ReturnTypes.FriendlyName(), f.Description)),
 				Range:   expr.Range(),
 			}, nil
 		}
diff --git a/decoder/signature.go b/decoder/signature.go
index a1df59ef..ccb64cc5 100644
--- a/decoder/signature.go
+++ b/decoder/signature.go
@@ -51,17 +51,34 @@ func (d *PathDecoder) SignatureAtPos(filename string, pos hcl.Pos) (*lang.FuncSi
 				return nil // Unknown function
 			}
 
-			// TODO this should be based on `pos` and not the count of parameters
-			// a new entry is added to `Args` only after a user adds content, like ""
-			// not after a user types a `,`
-			// TODO this need to account for variadic arguments (VarParam)
-			activePar := max(len(fNode.Args)-1, 0)
+			activePar := 0 // default to first parameter
+			foundActivePar := false
+			// TODO check paren rage
+			for i, v := range fNode.Args {
+				if v.Range().ContainsPos(pos) {
+					activePar = i
+					foundActivePar = true
+					break
+				}
+			}
+
+			if !foundActivePar {
+				// TODO how to account for spaces and commas?
+				// use f.Bytes
+			}
 
 			paramsLen := len(f.Params)
 			if f.VarParam != nil {
 				paramsLen += 1
 			}
 
+			if activePar > paramsLen {
+				// there are multiple variadic parameters defined, so
+				// we want to highlight the variadic parameter in the
+				// function signature
+				activePar = paramsLen - 1
+			}
+
 			parameters := make([]lang.FuncParameter, 0, paramsLen)
 			for _, p := range f.Params {
 				parameters = append(parameters, lang.FuncParameter{