diff --git a/src/parser/attribute/process.rs b/src/parser/attribute/process.rs
index 55decdc..913a838 100644
--- a/src/parser/attribute/process.rs
+++ b/src/parser/attribute/process.rs
@@ -369,16 +369,16 @@ mod tests {
     #[test]
     fn it_should_process_attribute_with_multiline_value() {
         let input = r#"class="{
-        'is-active': isActive,
-        'is-disabled': isDisabled,
+       'is-active': isActive,
+         'is-disabled': isDisabled,
     }"
-    :key="item.id""#;
+     :key="item.id""#;
 
         let (rest, attribute) = process_attribute(
             input,
             &mut HsmlProcessContext {
-                indent_level: 1,
-                indent_string: Some(String::from("    ")),
+                nested_tag_level: 1,
+                indent_string: String::from("    "),
             },
         )
         .unwrap();
@@ -386,14 +386,14 @@ mod tests {
         assert_eq!(
             attribute,
             r#"class="{
-        'is-active': isActive,
-        'is-disabled': isDisabled,
+       'is-active': isActive,
+         'is-disabled': isDisabled,
     }""#
         );
         assert_eq!(
             rest,
             r#"
-    :key="item.id""#
+     :key="item.id""#
         );
     }
 
diff --git a/src/parser/mod.rs b/src/parser/mod.rs
index bca4cdb..e13509e 100644
--- a/src/parser/mod.rs
+++ b/src/parser/mod.rs
@@ -31,8 +31,14 @@ pub enum HsmlNode {
 
 #[derive(Debug, Default)]
 pub struct HsmlProcessContext {
-    pub indent_level: usize,
-    pub indent_string: Option<String>,
+    // TODO @Shinigami92 2025-03-16: Currently nested_tag_level is not used, but should be later to allow mixed spaces and tabs in indentation
+    /// The tracked nested tag level
+    pub nested_tag_level: usize,
+
+    /// The tracked indentation string
+    ///
+    /// Can be a combination of spaces and tabs
+    pub indent_string: String,
 }
 
 pub fn process_newline(input: &str) -> IResult<&str, &str> {
diff --git a/src/parser/parse.rs b/src/parser/parse.rs
index 5fbef0d..9f3a52f 100644
--- a/src/parser/parse.rs
+++ b/src/parser/parse.rs
@@ -15,9 +15,19 @@ pub fn parse(input: &str) -> IResult<&str, RootNode> {
 
     loop {
         // eat leading and trailing newlines and whitespace if there are any
-        if let Ok((rest, _)) =
+        if let Ok((rest, taken)) =
             take_till::<_, &str, nom::error::Error<&str>>(|c: char| !c.is_whitespace())(input)
         {
+            // take the leading spaces and tabs after the last newline as indentation
+            context.indent_string = taken
+                .chars()
+                .rev()
+                .take_while(|c| c.is_whitespace() && *c != '\n')
+                .collect::<String>()
+                .chars()
+                .rev()
+                .collect();
+
             input = rest;
 
             if input.is_empty() {
diff --git a/src/parser/tag/node.rs b/src/parser/tag/node.rs
index 8e40ede..364396d 100644
--- a/src/parser/tag/node.rs
+++ b/src/parser/tag/node.rs
@@ -120,34 +120,25 @@ pub fn tag_node<'a>(input: &'a str, context: &mut HsmlProcessContext) -> IResult
 
             if !indentation.is_empty() {
                 // check that the indentation is consistent and does not include tabs and spaces at the same time
-                // if it does, throw an error
+                // if it does, collect an error for diagnostics
 
                 if indentation.contains('\t') && indentation.contains(' ') {
-                    // TODO @Shinigami92 2023-05-18: This error could be more specific
-                    return Err(nom::Err::Error(Error::new(input, ErrorKind::Tag)));
-                }
-
-                // if we never hit an indentation yet, set it
-                // this only happens once
-                if context.indent_string.is_none() {
-                    // println!("set indent string = \"{}\"", indentation);
-                    context.indent_string = Some(indentation.to_string());
+                    // TODO @Shinigami92 2025-03-16: This should collect an error or diagnostics
                 }
 
                 // persist the indentation level so we can restore it later
-                let indentation_level = context.indent_level;
-
-                context.indent_level += 1;
+                let nested_tag_level = context.nested_tag_level;
+                let indent_string = context.indent_string.clone();
 
                 // check that we are at the correct indentation level, otherwise break out of the loop
-                let indent_string_len = context.indent_string.as_ref().unwrap().len();
-                let indent_size = indent_string_len * context.indent_level;
-                // dbg!(indent_size, indentation.len());
-                if indent_size != indentation.len() {
+                if indentation.len() <= context.indent_string.len() {
                     // dbg!("break out of loop");
                     break;
                 }
 
+                context.nested_tag_level += 1;
+                context.indent_string = indentation.to_string();
+
                 // we are at the correct indentation level, so we can continue parsing the child tag nodes
 
                 // there could be a comment (dev or native) node
@@ -169,8 +160,9 @@ pub fn tag_node<'a>(input: &'a str, context: &mut HsmlProcessContext) -> IResult
                     }
                 }
 
-                // restore the indentation level
-                context.indent_level = indentation_level;
+                // restore the nested_tag_level level
+                context.nested_tag_level = nested_tag_level;
+                context.indent_string = indent_string;
 
                 continue;
             }
@@ -207,8 +199,8 @@ mod tests {
     #[test]
     fn it_should_return_tag_node_with_piped_text() {
         let context = &mut HsmlProcessContext {
-            indent_level: 3,
-            indent_string: Some(String::from("  ")),
+            nested_tag_level: 3,
+            indent_string: String::from("      "),
         };
 
         let (input, tag) = tag_node(
diff --git a/src/parser/text/node.rs b/src/parser/text/node.rs
index 24c635b..1a8e4e7 100644
--- a/src/parser/text/node.rs
+++ b/src/parser/text/node.rs
@@ -15,17 +15,12 @@ pub fn text_block_node<'a>(
 ) -> IResult<&'a str, TextNode> {
     let (input, text) = process_text_block(input, context)?;
 
-    let indent_string = context
-        .indent_string
-        .as_ref()
-        .unwrap()
-        .repeat(context.indent_level + 1);
-
-    let newline_indent_replacement: &str = &format!("\n{}", &indent_string);
-
+    // On every line, replace all leading spaces and tabs with an empty string
     let text = text
-        .trim_start_matches(&indent_string)
-        .replace(newline_indent_replacement, "\n");
+        .lines()
+        .map(|line| line.trim_start())
+        .collect::<Vec<&str>>()
+        .join("\n");
 
     Ok((input, TextNode { text }))
 }
@@ -51,8 +46,8 @@ mod tests {
     #[test]
     fn it_should_return_text_block_node() {
         let context = &mut HsmlProcessContext {
-            indent_string: Some(String::from("  ")),
-            indent_level: 3,
+            nested_tag_level: 3,
+            indent_string: String::from("      "),
         };
 
         let (input, text_block) = text_block_node(
@@ -78,4 +73,33 @@ and the build size is tiny.""#
 
         assert_eq!(input, "\n    figcaption.font-medium");
     }
+
+    #[test]
+    fn it_should_stop_before_next_tag_node() {
+        let context = &mut HsmlProcessContext {
+            nested_tag_level: 1,
+            indent_string: String::from("  "),
+        };
+
+        let (input, text_block) = text_block_node(
+            r#".
+    Sarah Dayan
+  .text-[#af05c9].dark:text-slate-500.
+    Staff Engineer, Algolia"#,
+            context,
+        )
+        .unwrap();
+
+        assert_eq!(
+            text_block,
+            TextNode {
+                text: String::from(r#"Sarah Dayan"#),
+            }
+        );
+
+        assert_eq!(
+            input,
+            "\n  .text-[#af05c9].dark:text-slate-500.\n    Staff Engineer, Algolia"
+        );
+    }
 }
diff --git a/src/parser/text/process.rs b/src/parser/text/process.rs
index 096d042..6f2b99a 100644
--- a/src/parser/text/process.rs
+++ b/src/parser/text/process.rs
@@ -15,17 +15,9 @@ pub fn process_text_block<'a>(
     // eat one \r\n or \n
     let (rest, _) = alt((tag("\r\n"), tag("\n"))).parse(rest)?;
 
-    let indent_string: &str = if let Some(indent_string) = &context.indent_string {
-        indent_string
-    } else {
-        "  "
-    };
-
-    let indent_string: &str = &indent_string.repeat(context.indent_level + 1);
-
     let mut text_block_index = 0;
 
-    // loop over each line until we find a line that does not fulfill the indentation
+    // loop over each line until we find a line that does not starts with the current indent string
     for (index, c) in rest.chars().enumerate() {
         if c == '\n' {
             // if next char is also a \n, then continue
@@ -38,7 +30,15 @@ pub fn process_text_block<'a>(
             let line = &rest[index + 1..];
 
             // otherwise check the indentation and if it does not fulfill the indentation, then break
-            if !line.starts_with(indent_string) {
+            // TODO @Shinigami92 2025-03-16: right now this does not support mixed indentations on tag level indentation, but only withing the text block
+            if !line.starts_with(&context.indent_string) {
+                break;
+            }
+
+            let line = &line[context.indent_string.len()..];
+
+            // break out if the first character is not a space or tab
+            if !line.starts_with(' ') && !line.starts_with('\t') {
                 break;
             }
         } else {
@@ -69,15 +69,15 @@ mod tests {
     #[test]
     fn it_should_process_text_block() {
         let mut context = HsmlProcessContext {
-            indent_string: Some(String::from("  ")),
-            indent_level: 1,
+            nested_tag_level: 1,
+            indent_string: String::from("  "),
         };
 
         let input = r#".
-    this is just some text
+   this is just some text
     it can be multiline
 
-    and also contain blank lines
+    	and also contain blank lines
 span other text
 "#;
 
@@ -85,10 +85,10 @@ span other text
 
         assert_eq!(
             text_block,
-            r#"    this is just some text
+            r#"   this is just some text
     it can be multiline
 
-    and also contain blank lines"#
+    	and also contain blank lines"#
         );
         assert_eq!(
             rest,