diff --git a/Sources/SwiftLanguageService/SemanticTokens.swift b/Sources/SwiftLanguageService/SemanticTokens.swift
index 8aa0a081a..4ae5b6533 100644
--- a/Sources/SwiftLanguageService/SemanticTokens.swift
+++ b/Sources/SwiftLanguageService/SemanticTokens.swift
@@ -161,7 +161,7 @@ extension SyntaxClassification {
     case .docLineComment, .docBlockComment:
       return (.comment, .documentation)
     case .argumentLabel:
-      return (.function, [])
+      return (.function, .parameterLabel)
     #if RESILIENT_LIBRARIES
     @unknown default:
       fatalError("Unknown case")
diff --git a/Sources/SwiftLanguageService/SyntaxHighlightingTokenParser.swift b/Sources/SwiftLanguageService/SyntaxHighlightingTokenParser.swift
index eae1a8aba..c304bdfb4 100644
--- a/Sources/SwiftLanguageService/SyntaxHighlightingTokenParser.swift
+++ b/Sources/SwiftLanguageService/SyntaxHighlightingTokenParser.swift
@@ -172,7 +172,7 @@ struct SyntaxHighlightingTokenParser {
       // therefore we don't use .parameter here (which LSP clients like
       // VSCode seem to interpret as variable identifiers, however
       // causing a 'wrong highlighting' e.g. of `x` in `f(x y: Int) {}`)
-      return (.function, [.declaration])
+      return (.function, [.declaration, .parameterLabel])
     case values.refVarStatic,
       values.refVarClass,
       values.refVarInstance:
diff --git a/Tests/SourceKitLSPTests/SemanticTokensTests.swift b/Tests/SourceKitLSPTests/SemanticTokensTests.swift
index c5221fe58..0157751bf 100644
--- a/Tests/SourceKitLSPTests/SemanticTokensTests.swift
+++ b/Tests/SourceKitLSPTests/SemanticTokensTests.swift
@@ -321,7 +321,7 @@ final class SemanticTokensTests: SourceKitLSPTestCase {
       expected: [
         TokenSpec(marker: "1️⃣", length: 4, kind: .keyword),
         TokenSpec(marker: "2️⃣", length: 1, kind: .identifier),
-        TokenSpec(marker: "3️⃣", length: 1, kind: .function),
+        TokenSpec(marker: "3️⃣", length: 1, kind: .function, modifiers: .parameterLabel),
         TokenSpec(marker: "4️⃣", length: 3, kind: .struct, modifiers: .defaultLibrary),
         TokenSpec(marker: "5️⃣", length: 1, kind: .identifier),
         TokenSpec(marker: "6️⃣", length: 6, kind: .struct, modifiers: .defaultLibrary),
@@ -844,7 +844,7 @@ final class SemanticTokensTests: SourceKitLSPTestCase {
         TokenSpec(marker: "2️⃣", length: 7, kind: .identifier),
         TokenSpec(marker: "3️⃣", length: 4, kind: .keyword),
         TokenSpec(marker: "4️⃣", length: 1, kind: .identifier),
-        TokenSpec(marker: "5️⃣", length: 1, kind: .function),
+        TokenSpec(marker: "5️⃣", length: 1, kind: .function, modifiers: .parameterLabel),
         TokenSpec(marker: "6️⃣", length: 7, kind: .actor),
       ]
     )
@@ -859,10 +859,10 @@ final class SemanticTokensTests: SourceKitLSPTestCase {
       expected: [
         TokenSpec(marker: "1️⃣", length: 4, kind: .keyword),
         TokenSpec(marker: "2️⃣", length: 3, kind: .identifier),
-        TokenSpec(marker: "3️⃣", length: 3, kind: .function),
+        TokenSpec(marker: "3️⃣", length: 3, kind: .function, modifiers: .parameterLabel),
         TokenSpec(marker: "4️⃣", length: 3, kind: .struct, modifiers: .defaultLibrary),
         TokenSpec(marker: "5️⃣", length: 3, kind: .function),
-        TokenSpec(marker: "6️⃣", length: 3, kind: .function),
+        TokenSpec(marker: "6️⃣", length: 3, kind: .function, modifiers: .parameterLabel),
         TokenSpec(marker: "7️⃣", length: 1, kind: .number),
       ]
     )
@@ -876,7 +876,7 @@ final class SemanticTokensTests: SourceKitLSPTestCase {
       expected: [
         TokenSpec(marker: "1️⃣", length: 4, kind: .keyword),
         TokenSpec(marker: "2️⃣", length: 3, kind: .identifier),
-        TokenSpec(marker: "3️⃣", length: 3, kind: .function),
+        TokenSpec(marker: "3️⃣", length: 3, kind: .function, modifiers: .parameterLabel),
         TokenSpec(marker: "4️⃣", length: 12, kind: .identifier),
         TokenSpec(marker: "5️⃣", length: 3, kind: .struct, modifiers: .defaultLibrary),
       ]