diff --git a/.changeset/spotty-sheep-fetch.md b/.changeset/spotty-sheep-fetch.md
new file mode 100644
index 000000000000..8a23f40e3a42
--- /dev/null
+++ b/.changeset/spotty-sheep-fetch.md
@@ -0,0 +1,5 @@
+---
+'svelte': minor
+---
+
+feat: better inlining of static attributes
diff --git a/packages/svelte/src/compiler/phases/2-analyze/visitors/Attribute.js b/packages/svelte/src/compiler/phases/2-analyze/visitors/Attribute.js
index 2a281a1aa3d9..6931f873fbf7 100644
--- a/packages/svelte/src/compiler/phases/2-analyze/visitors/Attribute.js
+++ b/packages/svelte/src/compiler/phases/2-analyze/visitors/Attribute.js
@@ -1,7 +1,7 @@
 /** @import { ArrowFunctionExpression, Expression, FunctionDeclaration, FunctionExpression } from 'estree' */
 /** @import { AST, DelegatedEvent, SvelteNode } from '#compiler' */
 /** @import { Context } from '../types' */
-import { is_capture_event, is_delegated } from '../../../../utils.js';
+import { is_boolean_attribute, is_capture_event, is_delegated } from '../../../../utils.js';
 import {
 	get_attribute_chunks,
 	get_attribute_expression,
@@ -16,14 +16,23 @@ import { mark_subtree_dynamic } from './shared/fragment.js';
 export function Attribute(node, context) {
 	context.next();
 
+	const parent = /** @type {SvelteNode} */ (context.path.at(-1));
+
 	// special case
 	if (node.name === 'value') {
-		const parent = /** @type {SvelteNode} */ (context.path.at(-1));
 		if (parent.type === 'RegularElement' && parent.name === 'option') {
 			mark_subtree_dynamic(context.path);
 		}
 	}
 
+	if (node.name.startsWith('on')) {
+		mark_subtree_dynamic(context.path);
+	}
+
+	if (parent.type === 'RegularElement' && is_boolean_attribute(node.name.toLowerCase())) {
+		node.metadata.expression.can_inline = false;
+	}
+
 	if (node.value !== true) {
 		for (const chunk of get_attribute_chunks(node.value)) {
 			if (chunk.type !== 'ExpressionTag') continue;
@@ -37,6 +46,7 @@ export function Attribute(node, context) {
 
 			node.metadata.expression.has_state ||= chunk.metadata.expression.has_state;
 			node.metadata.expression.has_call ||= chunk.metadata.expression.has_call;
+			node.metadata.expression.can_inline &&= chunk.metadata.expression.can_inline;
 		}
 
 		if (is_event_attribute(node)) {
diff --git a/packages/svelte/src/compiler/phases/2-analyze/visitors/CallExpression.js b/packages/svelte/src/compiler/phases/2-analyze/visitors/CallExpression.js
index 957b27ae9bc8..2ae32e80e1ba 100644
--- a/packages/svelte/src/compiler/phases/2-analyze/visitors/CallExpression.js
+++ b/packages/svelte/src/compiler/phases/2-analyze/visitors/CallExpression.js
@@ -178,6 +178,7 @@ export function CallExpression(node, context) {
 		if (!is_pure(node.callee, context) || context.state.expression.dependencies.size > 0) {
 			context.state.expression.has_call = true;
 			context.state.expression.has_state = true;
+			context.state.expression.can_inline = false;
 		}
 	}
 }
diff --git a/packages/svelte/src/compiler/phases/2-analyze/visitors/ExpressionTag.js b/packages/svelte/src/compiler/phases/2-analyze/visitors/ExpressionTag.js
index 32c8d2ca3671..f59b7fc5692b 100644
--- a/packages/svelte/src/compiler/phases/2-analyze/visitors/ExpressionTag.js
+++ b/packages/svelte/src/compiler/phases/2-analyze/visitors/ExpressionTag.js
@@ -2,7 +2,6 @@
 /** @import { Context } from '../types' */
 import { is_tag_valid_with_parent } from '../../../../html-tree-validation.js';
 import * as e from '../../../errors.js';
-import { mark_subtree_dynamic } from './shared/fragment.js';
 
 /**
  * @param {AST.ExpressionTag} node
@@ -15,9 +14,5 @@ export function ExpressionTag(node, context) {
 		}
 	}
 
-	// TODO ideally we wouldn't do this here, we'd just do it on encountering
-	// an `Identifier` within the tag. But we currently need to handle `{42}` etc
-	mark_subtree_dynamic(context.path);
-
 	context.next({ ...context.state, expression: node.metadata.expression });
 }
diff --git a/packages/svelte/src/compiler/phases/2-analyze/visitors/Identifier.js b/packages/svelte/src/compiler/phases/2-analyze/visitors/Identifier.js
index 79dccd5a7cf5..635f939c7520 100644
--- a/packages/svelte/src/compiler/phases/2-analyze/visitors/Identifier.js
+++ b/packages/svelte/src/compiler/phases/2-analyze/visitors/Identifier.js
@@ -1,5 +1,4 @@
 /** @import { Expression, Identifier } from 'estree' */
-/** @import { EachBlock } from '#compiler' */
 /** @import { Context } from '../types' */
 import is_reference from 'is-reference';
 import { should_proxy } from '../../3-transform/client/utils.js';
@@ -20,8 +19,6 @@ export function Identifier(node, context) {
 		return;
 	}
 
-	mark_subtree_dynamic(context.path);
-
 	// If we are using arguments outside of a function, then throw an error
 	if (
 		node.name === 'arguments' &&
@@ -87,6 +84,12 @@ export function Identifier(node, context) {
 		}
 	}
 
+	// no binding means global, and we can't inline e.g. `<span>{location}</span>`
+	// because it could change between component renders. if there _is_ a
+	// binding and it is outside module scope, the expression cannot
+	// be inlined (TODO allow inlining in more cases - e.g. primitive consts)
+	let can_inline = !!binding && !binding.scope.parent && binding.kind === 'normal';
+
 	if (binding) {
 		if (context.state.expression) {
 			context.state.expression.dependencies.add(binding);
@@ -122,4 +125,17 @@ export function Identifier(node, context) {
 			w.reactive_declaration_module_script_dependency(node);
 		}
 	}
+
+	if (!can_inline && context.state.expression) {
+		context.state.expression.can_inline = false;
+	}
+
+	/**
+	 * if the identifier is part of an expression tag of an attribute we want to check if it's inlinable
+	 * before marking the subtree as dynamic. This is because if it's inlinable it will be inlined in the template
+	 * directly making the whole thing actually static.
+	 */
+	if (!can_inline || !context.path.find((node) => node.type === 'Attribute')) {
+		mark_subtree_dynamic(context.path);
+	}
 }
diff --git a/packages/svelte/src/compiler/phases/2-analyze/visitors/MemberExpression.js b/packages/svelte/src/compiler/phases/2-analyze/visitors/MemberExpression.js
index 171a1106a8ce..adcc2da4226e 100644
--- a/packages/svelte/src/compiler/phases/2-analyze/visitors/MemberExpression.js
+++ b/packages/svelte/src/compiler/phases/2-analyze/visitors/MemberExpression.js
@@ -19,6 +19,7 @@ export function MemberExpression(node, context) {
 
 	if (context.state.expression && !is_pure(node, context)) {
 		context.state.expression.has_state = true;
+		context.state.expression.can_inline = false;
 	}
 
 	if (!is_safe_identifier(node, context.state.scope)) {
diff --git a/packages/svelte/src/compiler/phases/2-analyze/visitors/TaggedTemplateExpression.js b/packages/svelte/src/compiler/phases/2-analyze/visitors/TaggedTemplateExpression.js
index eacb8a342ac2..724b9af31185 100644
--- a/packages/svelte/src/compiler/phases/2-analyze/visitors/TaggedTemplateExpression.js
+++ b/packages/svelte/src/compiler/phases/2-analyze/visitors/TaggedTemplateExpression.js
@@ -10,6 +10,7 @@ export function TaggedTemplateExpression(node, context) {
 	if (context.state.expression && !is_pure(node.tag, context)) {
 		context.state.expression.has_call = true;
 		context.state.expression.has_state = true;
+		context.state.expression.can_inline = false;
 	}
 
 	if (node.tag.type === 'Identifier') {
diff --git a/packages/svelte/src/compiler/phases/3-transform/client/utils.js b/packages/svelte/src/compiler/phases/3-transform/client/utils.js
index c46090597709..910f173f79ae 100644
--- a/packages/svelte/src/compiler/phases/3-transform/client/utils.js
+++ b/packages/svelte/src/compiler/phases/3-transform/client/utils.js
@@ -1,18 +1,18 @@
 /** @import { ArrowFunctionExpression, Expression, FunctionDeclaration, FunctionExpression, Identifier, Pattern, PrivateIdentifier, Statement } from 'estree' */
-/** @import { AST, Binding, SvelteNode } from '#compiler' */
+/** @import { Binding, SvelteNode } from '#compiler' */
 /** @import { ClientTransformState, ComponentClientTransformState, ComponentContext } from './types.js' */
 /** @import { Analysis } from '../../types.js' */
 /** @import { Scope } from '../../scope.js' */
-import * as b from '../../../utils/builders.js';
-import { extract_identifiers, is_simple_expression } from '../../../utils/ast.js';
 import {
-	PROPS_IS_LAZY_INITIAL,
+	PROPS_IS_BINDABLE,
 	PROPS_IS_IMMUTABLE,
+	PROPS_IS_LAZY_INITIAL,
 	PROPS_IS_RUNES,
-	PROPS_IS_UPDATED,
-	PROPS_IS_BINDABLE
+	PROPS_IS_UPDATED
 } from '../../../../constants.js';
 import { dev } from '../../../state.js';
+import { extract_identifiers, is_simple_expression } from '../../../utils/ast.js';
+import * as b from '../../../utils/builders.js';
 import { get_value } from './visitors/shared/declarations.js';
 
 /**
@@ -311,43 +311,3 @@ export function create_derived_block_argument(node, context) {
 export function create_derived(state, arg) {
 	return b.call(state.analysis.runes ? '$.derived' : '$.derived_safe_equal', arg);
 }
-
-/**
- * Whether a variable can be referenced directly from template string.
- * @param {import('#compiler').Binding | undefined} binding
- * @returns {boolean}
- */
-export function can_inline_variable(binding) {
-	return (
-		!!binding &&
-		// in a `<script module>` block
-		!binding.scope.parent &&
-		// to prevent the need for escaping
-		binding.initial?.type === 'Literal'
-	);
-}
-
-/**
- * @param {(AST.Text | AST.ExpressionTag) | (AST.Text | AST.ExpressionTag)[]} node_or_nodes
- * @param {import('./types.js').ComponentClientTransformState} state
- */
-export function is_inlinable_expression(node_or_nodes, state) {
-	let nodes = Array.isArray(node_or_nodes) ? node_or_nodes : [node_or_nodes];
-	let has_expression_tag = false;
-	for (let value of nodes) {
-		if (value.type === 'ExpressionTag') {
-			if (value.expression.type === 'Identifier') {
-				const binding = state.scope
-					.owner(value.expression.name)
-					?.declarations.get(value.expression.name);
-				if (!can_inline_variable(binding)) {
-					return false;
-				}
-			} else {
-				return false;
-			}
-			has_expression_tag = true;
-		}
-	}
-	return has_expression_tag;
-}
diff --git a/packages/svelte/src/compiler/phases/3-transform/client/visitors/Fragment.js b/packages/svelte/src/compiler/phases/3-transform/client/visitors/Fragment.js
index 08e06cc714d4..111516ce0ae0 100644
--- a/packages/svelte/src/compiler/phases/3-transform/client/visitors/Fragment.js
+++ b/packages/svelte/src/compiler/phases/3-transform/client/visitors/Fragment.js
@@ -1,4 +1,4 @@
-/** @import { Expression, Identifier, Statement } from 'estree' */
+/** @import { Expression, Identifier, Statement, TemplateElement } from 'estree' */
 /** @import { AST, Namespace } from '#compiler' */
 /** @import { SourceLocation } from '#shared' */
 /** @import { ComponentClientTransformState, ComponentContext } from '../types' */
@@ -141,14 +141,14 @@ export function Fragment(node, context) {
 		const id = b.id(context.state.scope.generate('fragment'));
 
 		const use_space_template =
-			trimmed.some((node) => node.type === 'ExpressionTag') &&
-			trimmed.every((node) => node.type === 'Text' || node.type === 'ExpressionTag');
+			trimmed.every((node) => node.type === 'Text' || node.type === 'ExpressionTag') &&
+			trimmed.some((node) => node.type === 'ExpressionTag' && !node.metadata.expression.can_inline);
 
 		if (use_space_template) {
 			// special case — we can use `$.text` instead of creating a unique template
 			const id = b.id(context.state.scope.generate('text'));
 
-			process_children(trimmed, () => id, false, {
+			process_children(trimmed, () => id, null, {
 				...context,
 				state
 			});
@@ -158,12 +158,12 @@ export function Fragment(node, context) {
 		} else {
 			if (is_standalone) {
 				// no need to create a template, we can just use the existing block's anchor
-				process_children(trimmed, () => b.id('$$anchor'), false, { ...context, state });
+				process_children(trimmed, () => b.id('$$anchor'), null, { ...context, state });
 			} else {
 				/** @type {(is_text: boolean) => Expression} */
 				const expression = (is_text) => b.call('$.first_child', id, is_text && b.true);
 
-				process_children(trimmed, expression, false, { ...context, state });
+				process_children(trimmed, expression, null, { ...context, state });
 
 				let flags = TEMPLATE_FRAGMENT;
 
@@ -212,12 +212,34 @@ function join_template(items) {
 	let quasi = b.quasi('');
 	const template = b.template([quasi], []);
 
+	/**
+	 * @param {Expression} expression
+	 */
+	function push(expression) {
+		if (expression.type === 'TemplateLiteral') {
+			for (let i = 0; i < expression.expressions.length; i += 1) {
+				const q = expression.quasis[i];
+				const e = expression.expressions[i];
+
+				quasi.value.cooked += /** @type {string} */ (q.value.cooked);
+				push(e);
+			}
+
+			const last = /** @type {TemplateElement} */ (expression.quasis.at(-1));
+			quasi.value.cooked += /** @type {string} */ (last.value.cooked);
+		} else if (expression.type === 'Literal') {
+			/** @type {string} */ (quasi.value.cooked) += expression.value;
+		} else {
+			template.expressions.push(expression);
+			template.quasis.push((quasi = b.quasi('')));
+		}
+	}
+
 	for (const item of items) {
 		if (typeof item === 'string') {
 			quasi.value.cooked += item;
 		} else {
-			template.expressions.push(item);
-			template.quasis.push((quasi = b.quasi('')));
+			push(item);
 		}
 	}
 
diff --git a/packages/svelte/src/compiler/phases/3-transform/client/visitors/RegularElement.js b/packages/svelte/src/compiler/phases/3-transform/client/visitors/RegularElement.js
index 4d3cebcee6fe..455327a71219 100644
--- a/packages/svelte/src/compiler/phases/3-transform/client/visitors/RegularElement.js
+++ b/packages/svelte/src/compiler/phases/3-transform/client/visitors/RegularElement.js
@@ -1,46 +1,36 @@
-/** @import { Expression, ExpressionStatement, Identifier, MemberExpression, ObjectExpression, Statement } from 'estree' */
+/** @import { Expression, ExpressionStatement, Identifier, Literal, MemberExpression, ObjectExpression, Statement } from 'estree' */
 /** @import { AST } from '#compiler' */
 /** @import { SourceLocation } from '#shared' */
 /** @import { ComponentClientTransformState, ComponentContext } from '../types' */
 /** @import { Scope } from '../../../scope' */
+import { escape_html } from '../../../../../escaping.js';
 import {
 	is_boolean_attribute,
 	is_dom_property,
 	is_load_error_element,
 	is_void
 } from '../../../../../utils.js';
-import { escape_html } from '../../../../../escaping.js';
 import { dev, is_ignored, locator } from '../../../../state.js';
-import {
-	get_attribute_expression,
-	is_event_attribute,
-	is_text_attribute
-} from '../../../../utils/ast.js';
+import { is_event_attribute, is_text_attribute } from '../../../../utils/ast.js';
 import * as b from '../../../../utils/builders.js';
 import { is_custom_element_node } from '../../../nodes.js';
 import { clean_nodes, determine_namespace_for_children } from '../../utils.js';
+import { build_getter, create_derived } from '../utils.js';
 import {
-	build_getter,
-	can_inline_variable,
-	create_derived,
-	is_inlinable_expression
-} from '../utils.js';
-import {
-	get_attribute_name,
 	build_attribute_value,
 	build_class_directives,
+	build_set_attributes,
 	build_style_directives,
-	build_set_attributes
+	get_attribute_name
 } from './shared/element.js';
+import { visit_event_attribute } from './shared/events.js';
 import { process_children } from './shared/fragment.js';
 import {
 	build_render_statement,
-	build_template_literal,
+	build_template_chunk,
 	build_update,
-	build_update_assignment,
-	get_states_and_calls
+	build_update_assignment
 } from './shared/utils.js';
-import { visit_event_attribute } from './shared/events.js';
 
 /**
  * @param {AST.RegularElement} node
@@ -362,28 +352,32 @@ export function RegularElement(node, context) {
 
 	// special case — if an element that only contains text, we don't need
 	// to descend into it if the text is non-reactive
-	const states_and_calls =
-		trimmed.every((node) => node.type === 'Text' || node.type === 'ExpressionTag') &&
-		trimmed.some((node) => node.type === 'ExpressionTag') &&
-		get_states_and_calls(trimmed);
+	const is_text = trimmed.every((node) => node.type === 'Text' || node.type === 'ExpressionTag');
+
+	// in the rare case that we have static text that can't be inlined
+	// (e.g. `<span>{location}</span>`), set `textContent` programmatically
+	const use_text_content =
+		is_text &&
+		trimmed.every((node) => node.type === 'Text' || !node.metadata.expression.has_state) &&
+		trimmed.some((node) => node.type === 'ExpressionTag' && !node.metadata.expression.can_inline);
+
+	if (use_text_content) {
+		let { value } = build_template_chunk(trimmed, context.visit, child_state);
 
-	if (states_and_calls && states_and_calls.states === 0) {
 		child_state.init.push(
-			b.stmt(
-				b.assignment(
-					'=',
-					b.member(context.state.node, 'textContent'),
-					build_template_literal(trimmed, context.visit, child_state).value
-				)
-			)
+			b.stmt(b.assignment('=', b.member(context.state.node, 'textContent'), value))
 		);
 	} else {
 		/** @type {Expression} */
 		let arg = context.state.node;
 
 		// If `hydrate_node` is set inside the element, we need to reset it
-		// after the element has been hydrated
-		let needs_reset = trimmed.some((node) => node.type !== 'Text');
+		// after the element has been hydrated (we don't need to reset if it's been inlined)
+		let needs_reset = !trimmed.every(
+			(node) =>
+				node.type === 'Text' ||
+				(node.type === 'ExpressionTag' && node.metadata.expression.can_inline)
+		);
 
 		// The same applies if it's a `<template>` element, since we need to
 		// set the value of `hydrate_node` to `node.content`
@@ -393,7 +387,7 @@ export function RegularElement(node, context) {
 			arg = b.member(arg, 'content');
 		}
 
-		process_children(trimmed, (is_text) => b.call('$.child', arg, is_text && b.true), true, {
+		process_children(trimmed, (is_text) => b.call('$.child', arg, is_text && b.true), node, {
 			...context,
 			state: child_state
 		});
@@ -586,10 +580,6 @@ function build_element_attribute_update_assignment(element, node_id, attribute,
 		);
 	}
 
-	const inlinable_expression =
-		attribute.value === true
-			? false // not an expression
-			: is_inlinable_expression(attribute.value, context.state);
 	if (attribute.metadata.expression.has_state) {
 		if (has_call) {
 			state.init.push(build_update(update));
@@ -597,14 +587,44 @@ function build_element_attribute_update_assignment(element, node_id, attribute,
 			state.update.push(update);
 		}
 		return true;
-	} else {
-		if (inlinable_expression) {
-			context.state.template.push(` ${name}="`, value, '"');
+	}
+
+	// we need to special case textarea value because it's not an actual attribute
+	const can_inline =
+		(attribute.name !== 'value' || element.name !== 'textarea') &&
+		attribute.metadata.expression.can_inline;
+
+	if (can_inline) {
+		/** @type {Literal | undefined} */
+		let literal = undefined;
+
+		if (value.type === 'Literal') {
+			literal = value;
+		} else if (value.type === 'Identifier') {
+			const binding = context.state.scope.get(value.name);
+			if (binding && binding.initial?.type === 'Literal' && !binding.reassigned) {
+				literal = binding.initial;
+			}
+		}
+
+		if (literal && escape_html(literal.value, true) === String(literal.value)) {
+			if (is_boolean_attribute(name)) {
+				if (literal.value) {
+					context.state.template.push(` ${name}`);
+				}
+			} else {
+				context.state.template.push(` ${name}="`, value, '"');
+			}
 		} else {
-			state.init.push(update);
+			context.state.template.push(
+				b.call('$.attr', b.literal(name), value, is_boolean_attribute(name) && b.true)
+			);
 		}
-		return false;
+	} else {
+		state.init.push(update);
 	}
+
+	return false;
 }
 
 /**
diff --git a/packages/svelte/src/compiler/phases/3-transform/client/visitors/TitleElement.js b/packages/svelte/src/compiler/phases/3-transform/client/visitors/TitleElement.js
index a71deaf53953..72cc57b068a0 100644
--- a/packages/svelte/src/compiler/phases/3-transform/client/visitors/TitleElement.js
+++ b/packages/svelte/src/compiler/phases/3-transform/client/visitors/TitleElement.js
@@ -1,14 +1,14 @@
 /** @import { AST } from '#compiler' */
 /** @import { ComponentContext } from '../types' */
 import * as b from '../../../../utils/builders.js';
-import { build_template_literal } from './shared/utils.js';
+import { build_template_chunk } from './shared/utils.js';
 
 /**
  * @param {AST.TitleElement} node
  * @param {ComponentContext} context
  */
 export function TitleElement(node, context) {
-	const { has_state, value } = build_template_literal(
+	const { has_state, value } = build_template_chunk(
 		/** @type {any} */ (node.fragment.nodes),
 		context.visit,
 		context.state
diff --git a/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/element.js b/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/element.js
index e0fbe11b733b..1b0737e31e18 100644
--- a/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/element.js
+++ b/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/element.js
@@ -6,7 +6,7 @@ import { is_ignored } from '../../../../../state.js';
 import { get_attribute_expression, is_event_attribute } from '../../../../../utils/ast.js';
 import * as b from '../../../../../utils/builders.js';
 import { build_getter, create_derived } from '../../utils.js';
-import { build_template_literal, build_update } from './utils.js';
+import { build_template_chunk, build_update } from './utils.js';
 
 /**
  * @param {Array<AST.Attribute | AST.SpreadAttribute>} attributes
@@ -200,7 +200,7 @@ export function build_attribute_value(value, context) {
 		};
 	}
 
-	return build_template_literal(value, context.visit, context.state);
+	return build_template_chunk(value, context.visit, context.state);
 }
 
 /**
diff --git a/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/fragment.js b/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/fragment.js
index 3b009fb5b589..ac6e0f8f9fdb 100644
--- a/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/fragment.js
+++ b/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/fragment.js
@@ -1,10 +1,11 @@
 /** @import { Expression } from 'estree' */
 /** @import { AST, SvelteNode } from '#compiler' */
+/** @import { Scope } from '../../../../scope.js' */
 /** @import { ComponentContext } from '../../types' */
-import { is_event_attribute, is_text_attribute } from '../../../../../utils/ast.js';
+import { escape_html } from '../../../../../../escaping.js';
+import { is_event_attribute } from '../../../../../utils/ast.js';
 import * as b from '../../../../../utils/builders.js';
-import { is_inlinable_expression } from '../../utils.js';
-import { build_template_literal, build_update } from './utils.js';
+import { build_template_chunk, build_update } from './utils.js';
 
 /**
  * Processes an array of template nodes, joining sibling text/expression nodes
@@ -12,10 +13,10 @@ import { build_template_literal, build_update } from './utils.js';
  * corresponding template node references these updates are applied to.
  * @param {SvelteNode[]} nodes
  * @param {(is_text: boolean) => Expression} initial
- * @param {boolean} is_element
+ * @param {AST.RegularElement | null} element
  * @param {ComponentContext} context
  */
-export function process_children(nodes, initial, is_element, { visit, state }) {
+export function process_children(nodes, initial, element, { visit, state }) {
 	const within_bound_contenteditable = state.metadata.bound_contenteditable;
 	let prev = initial;
 	let skipped = 0;
@@ -61,16 +62,17 @@ export function process_children(nodes, initial, is_element, { visit, state }) {
 	 * @param {Sequence} sequence
 	 */
 	function flush_sequence(sequence) {
-		if (sequence.every((node) => node.type === 'Text')) {
+		const { has_state, has_call, value, can_inline } = build_template_chunk(sequence, visit, state);
+
+		if (can_inline) {
 			skipped += 1;
-			state.template.push(sequence.map((node) => node.raw).join(''));
+			const raw = element?.name === 'script' || element?.name === 'style';
+			state.template.push(raw ? value : escape_inline_expression(value, state.scope));
 			return;
 		}
 
 		state.template.push(' ');
 
-		const { has_state, has_call, value } = build_template_literal(sequence, visit, state);
-
 		// if this is a standalone `{expression}`, make sure we handle the case where
 		// no text node was created because the expression was empty during SSR
 		const is_text = sequence.length === 1;
@@ -98,9 +100,9 @@ export function process_children(nodes, initial, is_element, { visit, state }) {
 
 			let child_state = state;
 
-			if (is_static_element(node, state)) {
+			if (is_static_element(node)) {
 				skipped += 1;
-			} else if (node.type === 'EachBlock' && nodes.length === 1 && is_element) {
+			} else if (node.type === 'EachBlock' && nodes.length === 1 && element) {
 				node.metadata.is_controlled = true;
 			} else {
 				const id = flush_node(false, node.type === 'RegularElement' ? node.name : 'node');
@@ -125,9 +127,8 @@ export function process_children(nodes, initial, is_element, { visit, state }) {
 
 /**
  * @param {SvelteNode} node
- * @param {ComponentContext["state"]} state
  */
-function is_static_element(node, state) {
+function is_static_element(node) {
 	if (node.type !== 'RegularElement') return false;
 	if (node.fragment.metadata.dynamic) return false;
 	if (node.name.includes('-')) return false; // we're setting all attributes on custom elements through properties
@@ -154,16 +155,49 @@ function is_static_element(node, state) {
 			return false;
 		}
 
-		if (
-			attribute.value !== true &&
-			!is_text_attribute(attribute) &&
-			// If the attribute is not a text attribute but is inlinable we will directly inline it in the
-			// the template so before returning false we need to check that the attribute is not inlinable
-			!is_inlinable_expression(attribute.value, state)
-		) {
+		if (!attribute.metadata.expression.can_inline) {
 			return false;
 		}
 	}
 
 	return true;
 }
+
+/**
+ * @param {Expression} node
+ * @param {Scope} scope
+ * @returns {Expression}
+ */
+function escape_inline_expression(node, scope) {
+	if (node.type === 'Literal') {
+		if (typeof node.value === 'string') {
+			return b.literal(escape_html(node.value));
+		}
+
+		return node;
+	}
+
+	if (node.type === 'TemplateLiteral') {
+		return b.template(
+			node.quasis.map((q) => b.quasi(escape_html(q.value.cooked))),
+			node.expressions.map((expression) => escape_inline_expression(expression, scope))
+		);
+	}
+
+	/**
+	 * If we can't determine the range of possible values statically, wrap in
+	 * `$.escape(...)`. TODO expand this to cover more cases
+	 */
+	let needs_escape = true;
+
+	if (node.type === 'Identifier') {
+		const binding = scope.get(node.name);
+
+		// TODO handle more cases
+		if (binding?.initial?.type === 'Literal' && !binding.reassigned) {
+			needs_escape = escape_html(binding.initial.value) !== String(binding.initial.value);
+		}
+	}
+
+	return needs_escape ? b.call('$.escape', node) : node;
+}
diff --git a/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/utils.js b/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/utils.js
index 21b902d5c281..b74d2cc9c08e 100644
--- a/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/utils.js
+++ b/packages/svelte/src/compiler/phases/3-transform/client/visitors/shared/utils.js
@@ -1,4 +1,4 @@
-/** @import { Expression, ExpressionStatement, Identifier, MemberExpression, Statement, Super } from 'estree' */
+/** @import { Expression, ExpressionStatement, Identifier, MemberExpression, Statement, Super, TemplateLiteral, Node } from 'estree' */
 /** @import { AST, SvelteNode } from '#compiler' */
 /** @import { ComponentClientTransformState } from '../../types' */
 import { walk } from 'zimmerframe';
@@ -10,85 +10,89 @@ import { create_derived } from '../../utils.js';
 import is_reference from 'is-reference';
 import { locator } from '../../../../../state.js';
 
-/**
- * @param {Array<AST.Text | AST.ExpressionTag>} values
- */
-export function get_states_and_calls(values) {
-	let states = 0;
-	let calls = 0;
-	for (let i = 0; i < values.length; i++) {
-		const node = values[i];
-
-		if (node.type === 'ExpressionTag') {
-			if (node.metadata.expression.has_call) {
-				calls++;
-			}
-			if (node.metadata.expression.has_state) {
-				states++;
-			}
-		}
-	}
-
-	return { states, calls };
-}
-
 /**
  * @param {Array<AST.Text | AST.ExpressionTag>} values
  * @param {(node: SvelteNode, state: any) => any} visit
  * @param {ComponentClientTransformState} state
- * @returns {{ value: Expression, has_state: boolean, has_call: boolean }}
+ * @returns {{ value: Expression, has_state: boolean, has_call: boolean, can_inline: boolean }}
  */
-export function build_template_literal(values, visit, state) {
+export function build_template_chunk(values, visit, state) {
 	/** @type {Expression[]} */
 	const expressions = [];
 
 	let quasi = b.quasi('');
 	const quasis = [quasi];
 
-	const { states, calls } = get_states_and_calls(values);
+	let has_call = false;
+	let has_state = false;
+	let can_inline = true;
+	let contains_multiple_call_expression = false;
 
-	let has_call = calls > 0;
-	let has_state = states > 0;
-	let contains_multiple_call_expression = calls > 1;
+	for (const node of values) {
+		if (node.type === 'ExpressionTag') {
+			if (node.metadata.expression.has_call) {
+				if (has_call) contains_multiple_call_expression = true;
+				has_call = true;
+			}
+
+			if (node.metadata.expression.has_state) {
+				has_state = true;
+			}
+
+			if (!node.metadata.expression.can_inline) {
+				can_inline = false;
+			}
+		}
+	}
 
 	for (let i = 0; i < values.length; i++) {
 		const node = values[i];
 
 		if (node.type === 'Text') {
 			quasi.value.cooked += node.data;
-		} else if (node.type === 'ExpressionTag' && node.expression.type === 'Literal') {
-			if (node.expression.value != null) {
-				quasi.value.cooked += node.expression.value + '';
-			}
 		} else {
-			if (contains_multiple_call_expression) {
-				const id = b.id(state.scope.generate('stringified_text'));
-				state.init.push(
-					b.const(
-						id,
-						create_derived(
-							state,
-							b.thunk(
-								b.logical(
-									'??',
-									/** @type {Expression} */ (visit(node.expression, state)),
-									b.literal('')
-								)
-							)
-						)
-					)
-				);
-				expressions.push(b.call('$.get', id));
-			} else if (values.length === 1) {
-				// If we have a single expression, then pass that in directly to possibly avoid doing
-				// extra work in the template_effect (instead we do the work in set_text).
-				return { value: visit(node.expression, state), has_state, has_call };
+			const expression = /** @type {Expression} */ (visit(node.expression, state));
+
+			if (expression.type === 'Literal') {
+				if (expression.value != null) {
+					quasi.value.cooked += expression.value + '';
+				}
 			} else {
-				expressions.push(b.logical('??', visit(node.expression, state), b.literal('')));
-			}
+				let value = expression;
+
+				// if we don't know the value, we need to add `?? ''` to replace
+				// `null` and `undefined` with the empty string
+				let needs_fallback = true;
+
+				if (value.type === 'Identifier') {
+					const binding = state.scope.get(value.name);
 
-			quasi = b.quasi('', i + 1 === values.length);
-			quasis.push(quasi);
+					if (binding && binding.initial?.type === 'Literal' && !binding.reassigned) {
+						needs_fallback = binding.initial.value === null;
+					}
+				}
+
+				if (needs_fallback) {
+					value = b.logical('??', expression, b.literal(''));
+				}
+
+				if (contains_multiple_call_expression) {
+					const id = b.id(state.scope.generate('stringified_text'));
+
+					state.init.push(b.const(id, create_derived(state, b.thunk(value))));
+
+					expressions.push(b.call('$.get', id));
+				} else if (values.length === 1) {
+					// If we have a single expression, then pass that in directly to possibly avoid doing
+					// extra work in the template_effect (instead we do the work in set_text).
+					return { value: visit(node.expression, state), has_state, has_call, can_inline };
+				} else {
+					expressions.push(value);
+				}
+
+				quasi = b.quasi('', i + 1 === values.length);
+				quasis.push(quasi);
+			}
 		}
 	}
 
@@ -98,7 +102,7 @@ export function build_template_literal(values, visit, state) {
 
 	const value = b.template(quasis, expressions);
 
-	return { value, has_state, has_call };
+	return { value, has_state, has_call, can_inline };
 }
 
 /**
diff --git a/packages/svelte/src/compiler/phases/nodes.js b/packages/svelte/src/compiler/phases/nodes.js
index ead525aaa149..13a54730eb0c 100644
--- a/packages/svelte/src/compiler/phases/nodes.js
+++ b/packages/svelte/src/compiler/phases/nodes.js
@@ -58,6 +58,7 @@ export function create_expression_metadata() {
 	return {
 		dependencies: new Set(),
 		has_state: false,
-		has_call: false
+		has_call: false,
+		can_inline: true
 	};
 }
diff --git a/packages/svelte/src/compiler/types/index.d.ts b/packages/svelte/src/compiler/types/index.d.ts
index 8a45f2d4fd84..bd4749db001c 100644
--- a/packages/svelte/src/compiler/types/index.d.ts
+++ b/packages/svelte/src/compiler/types/index.d.ts
@@ -317,6 +317,8 @@ export interface ExpressionMetadata {
 	has_state: boolean;
 	/** True if the expression involves a call expression (often, it will need to be wrapped in a derived) */
 	has_call: boolean;
+	/** True if the expression can be inlined into a template */
+	can_inline: boolean;
 }
 
 export * from './template.js';
diff --git a/packages/svelte/src/internal/client/index.js b/packages/svelte/src/internal/client/index.js
index c401867a0f0b..bfc0a6aac93d 100644
--- a/packages/svelte/src/internal/client/index.js
+++ b/packages/svelte/src/internal/client/index.js
@@ -1,4 +1,5 @@
 export { FILENAME, HMR, NAMESPACE_SVG } from '../../constants.js';
+export { escape_html as escape } from '../../escaping.js';
 export { cleanup_styles } from './dev/css.js';
 export { add_locations } from './dev/elements.js';
 export { hmr } from './dev/hmr.js';
@@ -155,6 +156,7 @@ export {
 	$window as window,
 	$document as document
 } from './dom/operations.js';
+export { attr } from '../shared/attributes.js';
 export { snapshot } from '../shared/clone.js';
 export { noop, fallback } from '../shared/utils.js';
 export {
diff --git a/packages/svelte/src/internal/server/index.js b/packages/svelte/src/internal/server/index.js
index 9a66095de482..615a49fbd4c0 100644
--- a/packages/svelte/src/internal/server/index.js
+++ b/packages/svelte/src/internal/server/index.js
@@ -2,6 +2,7 @@
 /** @import { Component, Payload, RenderOutput } from '#server' */
 /** @import { Store } from '#shared' */
 export { FILENAME, HMR } from '../../constants.js';
+import { attr } from '../shared/attributes.js';
 import { is_promise, noop } from '../shared/utils.js';
 import { subscribe_to_store } from '../../store/utils.js';
 import {
@@ -153,33 +154,6 @@ export function head(payload, fn) {
 	head_payload.out += BLOCK_CLOSE;
 }
 
-/**
- * `<div translate={false}>` should be rendered as `<div translate="no">` and _not_
- * `<div translate="false">`, which is equivalent to `<div translate="yes">`. There
- * may be other odd cases that need to be added to this list in future
- * @type {Record<string, Map<any, string>>}
- */
-const replacements = {
-	translate: new Map([
-		[true, 'yes'],
-		[false, 'no']
-	])
-};
-
-/**
- * @template V
- * @param {string} name
- * @param {V} value
- * @param {boolean} [is_boolean]
- * @returns {string}
- */
-export function attr(name, value, is_boolean = false) {
-	if (value == null || (!value && is_boolean) || (value === '' && name === 'class')) return '';
-	const normalized = (name in replacements && replacements[name].get(value)) || value;
-	const assignment = is_boolean ? '' : `="${escape_html(normalized, true)}"`;
-	return ` ${name}${assignment}`;
-}
-
 /**
  * @param {Payload} payload
  * @param {boolean} is_html
@@ -549,6 +523,8 @@ export function once(get_value) {
 	};
 }
 
+export { attr };
+
 export { html } from './blocks/html.js';
 
 export { push, pop } from './context.js';
diff --git a/packages/svelte/src/internal/shared/attributes.js b/packages/svelte/src/internal/shared/attributes.js
new file mode 100644
index 000000000000..867d6ba5d378
--- /dev/null
+++ b/packages/svelte/src/internal/shared/attributes.js
@@ -0,0 +1,28 @@
+import { escape_html } from '../../escaping.js';
+
+/**
+ * `<div translate={false}>` should be rendered as `<div translate="no">` and _not_
+ * `<div translate="false">`, which is equivalent to `<div translate="yes">`. There
+ * may be other odd cases that need to be added to this list in future
+ * @type {Record<string, Map<any, string>>}
+ */
+const replacements = {
+	translate: new Map([
+		[true, 'yes'],
+		[false, 'no']
+	])
+};
+
+/**
+ * @template V
+ * @param {string} name
+ * @param {V} value
+ * @param {boolean} [is_boolean]
+ * @returns {string}
+ */
+export function attr(name, value, is_boolean = false) {
+	if (value == null || (!value && is_boolean) || (value === '' && name === 'class')) return '';
+	const normalized = (name in replacements && replacements[name].get(value)) || value;
+	const assignment = is_boolean ? '' : `="${escape_html(normalized, true)}"`;
+	return ` ${name}${assignment}`;
+}
diff --git a/packages/svelte/tests/runtime-legacy/samples/attribute-boolean-case-insensitive/main.svelte b/packages/svelte/tests/runtime-legacy/samples/attribute-boolean-case-insensitive/main.svelte
index 90208940868a..bcc418511fa7 100644
--- a/packages/svelte/tests/runtime-legacy/samples/attribute-boolean-case-insensitive/main.svelte
+++ b/packages/svelte/tests/runtime-legacy/samples/attribute-boolean-case-insensitive/main.svelte
@@ -1 +1 @@
-<input READONLY={true} REQUIRED={false}>
+<input READONLY={!0} REQUIRED={!1}>
diff --git a/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/client/index.svelte.js b/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/client/index.svelte.js
index 46ed3c1913f3..75e632239e0b 100644
--- a/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/client/index.svelte.js
+++ b/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/client/index.svelte.js
@@ -5,12 +5,13 @@ const __DECLARED_ASSET_0__ = "__VITE_ASSET__2AM7_y_a__ 1440w, __VITE_ASSET__2AM7
 const __DECLARED_ASSET_1__ = "__VITE_ASSET__2AM7_y_c__ 1440w, __VITE_ASSET__2AM7_y_d__ 960w";
 const __DECLARED_ASSET_2__ = "__VITE_ASSET__2AM7_y_e__ 1440w, __VITE_ASSET__2AM7_y_f__ 960w";
 const __DECLARED_ASSET_3__ = "__VITE_ASSET__2AM7_y_g__";
-var root = $.template(`<picture><source srcset="${__DECLARED_ASSET_0__}" type="image/avif"> <source srcset="${__DECLARED_ASSET_1__}" type="image/webp"> <source srcset="${__DECLARED_ASSET_2__}" type="image/png"> <img src="${__DECLARED_ASSET_3__}" alt="production test" width="1440" height="1440"></picture>`);
+const a = 1;
+const b = 2;
+var root = $.template(`<picture><source srcset="${__DECLARED_ASSET_0__}" type="image/avif"> <source srcset="${__DECLARED_ASSET_1__}" type="image/webp"> <source srcset="${__DECLARED_ASSET_2__}" type="image/png"> <img src="${__DECLARED_ASSET_3__}" alt="production test" width="1440" height="1440"></picture> <p>${a} + ${b} = ${$.escape(a + b ?? "")}</p>`, 1);
 
 export default function Inline_module_vars($$anchor) {
-	var picture = root();
+	var fragment = root();
+	var p = $.sibling($.first_child(fragment), 2);
 
-	$.next(6);
-	$.reset(picture);
-	$.append($$anchor, picture);
+	$.append($$anchor, fragment);
 }
\ No newline at end of file
diff --git a/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/server/index.svelte.js b/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/server/index.svelte.js
index 9dad39d81e9e..ca98cd952b72 100644
--- a/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/server/index.svelte.js
+++ b/packages/svelte/tests/snapshot/samples/inline-module-vars/_expected/server/index.svelte.js
@@ -4,7 +4,9 @@ const __DECLARED_ASSET_0__ = "__VITE_ASSET__2AM7_y_a__ 1440w, __VITE_ASSET__2AM7
 const __DECLARED_ASSET_1__ = "__VITE_ASSET__2AM7_y_c__ 1440w, __VITE_ASSET__2AM7_y_d__ 960w";
 const __DECLARED_ASSET_2__ = "__VITE_ASSET__2AM7_y_e__ 1440w, __VITE_ASSET__2AM7_y_f__ 960w";
 const __DECLARED_ASSET_3__ = "__VITE_ASSET__2AM7_y_g__";
+const a = 1;
+const b = 2;
 
 export default function Inline_module_vars($$payload) {
-	$$payload.out += `<picture><source${$.attr("srcset", __DECLARED_ASSET_0__)} type="image/avif"> <source${$.attr("srcset", __DECLARED_ASSET_1__)} type="image/webp"> <source${$.attr("srcset", __DECLARED_ASSET_2__)} type="image/png"> <img${$.attr("src", __DECLARED_ASSET_3__)} alt="production test" width="1440" height="1440"></picture>`;
+	$$payload.out += `<picture><source${$.attr("srcset", __DECLARED_ASSET_0__)} type="image/avif"> <source${$.attr("srcset", __DECLARED_ASSET_1__)} type="image/webp"> <source${$.attr("srcset", __DECLARED_ASSET_2__)} type="image/png"> <img${$.attr("src", __DECLARED_ASSET_3__)} alt="production test"${$.attr("width", 1440)}${$.attr("height", 1440)}></picture> <p>${$.escape(a)} + ${$.escape(b)} = ${$.escape(a + b)}</p>`;
 }
\ No newline at end of file
diff --git a/packages/svelte/tests/snapshot/samples/inline-module-vars/index.svelte b/packages/svelte/tests/snapshot/samples/inline-module-vars/index.svelte
index b46a86dc0b64..a7b737e59612 100644
--- a/packages/svelte/tests/snapshot/samples/inline-module-vars/index.svelte
+++ b/packages/svelte/tests/snapshot/samples/inline-module-vars/index.svelte
@@ -5,11 +5,16 @@
 	const __DECLARED_ASSET_1__ = "__VITE_ASSET__2AM7_y_c__ 1440w, __VITE_ASSET__2AM7_y_d__ 960w";
 	const __DECLARED_ASSET_2__ = "__VITE_ASSET__2AM7_y_e__ 1440w, __VITE_ASSET__2AM7_y_f__ 960w";
 	const __DECLARED_ASSET_3__ = "__VITE_ASSET__2AM7_y_g__";
+
+	const a = 1;
+	const b = 2;
 </script>
 
 <picture>
 	<source srcset={__DECLARED_ASSET_0__} type="image/avif" />
 	<source srcset={__DECLARED_ASSET_1__} type="image/webp" />
 	<source srcset={__DECLARED_ASSET_2__} type="image/png" />
-	<img src={__DECLARED_ASSET_3__} alt="production test" width=1440 height=1440 />
+	<img src={__DECLARED_ASSET_3__} alt="production test" width={1440} height={1440} />
 </picture>
+
+<p>{a} + {b} = {a + b}</p>