diff --git a/src/interchange/xml.zig b/src/interchange/xml.zig
index 66fe45634e..18937b02d3 100644
--- a/src/interchange/xml.zig
+++ b/src/interchange/xml.zig
@@ -235,6 +235,16 @@ const Parser = struct {
 
         // Build result with cleaner structure - no __name or __children
         const trimmed_text = std.mem.trim(u8, text_parts.items, " \t\n\r");
+
+        // If element has only text content (no attributes, no children), return text directly
+        if (attributes.items.len == 0 and children.items.len == 0 and trimmed_text.len > 0) {
+            const text_expr = try self.createStringExpr(text_parts.items);
+            return ChildElement{
+                .tag_name = tag_name_slice,
+                .element = text_expr,
+            };
+        }
+
         var properties = std.ArrayList(G.Property).init(self.allocator);
 
         // Add attributes directly as properties
@@ -242,16 +252,27 @@ const Parser = struct {
             try properties.appendSlice(attributes.items);
         }
 
-        // Add children as direct properties
-        if (children.items.len > 0) {
+        // Handle mixed content (text + children) - use __children array only
+        if (children.items.len > 0 and text_parts.items.len > 0 and trimmed_text.len > 0) {
+            // Mixed content: use __children array only
+            var child_array = std.ArrayList(Expr).init(self.allocator);
+            for (children.items) |child| {
+                try child_array.append(child.element);
+            }
+            const children_array = Expr.init(E.Array, .{ .items = .fromList(child_array) }, .Empty);
+            const children_key = try self.createStringExpr("__children");
+            try properties.append(.{ .key = children_key, .value = children_array });
+        } else if (children.items.len > 0) {
+            // Children only: add as direct properties
             try self.addChildrenAsProperties(&properties, children.items);
-        }
-
-        // Add text content if present and no children
-        if (text_parts.items.len > 0 and trimmed_text.len > 0 and children.items.len == 0) {
+        } else if (text_parts.items.len > 0 and trimmed_text.len > 0 and attributes.items.len > 0) {
+            // Attributes + text only: use single-element __children array for consistency
             const text_expr = try self.createStringExpr(text_parts.items);
-            const text_key = try self.createStringExpr("__text");
-            try properties.append(.{ .key = text_key, .value = text_expr });
+            var child_array = std.ArrayList(Expr).init(self.allocator);
+            try child_array.append(text_expr);
+            const children_array = Expr.init(E.Array, .{ .items = .fromList(child_array) }, .Empty);
+            const children_key = try self.createStringExpr("__children");
+            try properties.append(.{ .key = children_key, .value = children_array });
         }
 
         const element = Expr.init(E.Object, .{ .properties = .fromList(properties) }, .Empty);
diff --git a/test/js/bun/xml/xml.test.ts b/test/js/bun/xml/xml.test.ts
index 9bf86565d7..fa8de94938 100644
--- a/test/js/bun/xml/xml.test.ts
+++ b/test/js/bun/xml/xml.test.ts
@@ -3,17 +3,13 @@ import { expect, test } from "bun:test";
 test("Bun.XML.parse - simple text element", () => {
   const xml = "<message>Hello World</message>";
   const result = Bun.XML.parse(xml);
-  expect(result).toEqual({
-    __text: "Hello World",
-  });
+  expect(result).toEqual("Hello World");
 });
 
 test("Bun.XML.parse - element with whitespace", () => {
   const xml = "<test>  content  </test>";
   const result = Bun.XML.parse(xml);
-  expect(result).toEqual({
-    __text: "  content  ",
-  });
+  expect(result).toEqual("  content  ");
 });
 
 test("Bun.XML.parse - empty element", () => {
@@ -28,16 +24,14 @@ test("Bun.XML.parse - element with attributes", () => {
   expect(result).toEqual({
     id: "1",
     type: "info",
-    __text: "Hello",
+    __children: ["Hello"],
   });
 });
 
 test("Bun.XML.parse - with XML declaration", () => {
   const xml = '<?xml version="1.0" encoding="UTF-8"?><root>content</root>';
   const result = Bun.XML.parse(xml);
-  expect(result).toEqual({
-    __text: "content",
-  });
+  expect(result).toEqual("content");
 });
 
 test("Bun.XML.parse - empty string", () => {
@@ -69,8 +63,8 @@ test("Bun.XML.parse - nested elements", () => {
   </person>`;
   const result = Bun.XML.parse(xml);
   expect(result).toEqual({
-    name: { __text: "John" },
-    age: { __text: "30" },
+    name: "John",
+    age: "30",
   });
 });
 
@@ -85,7 +79,7 @@ test("Bun.XML.parse - complex nested structure", () => {
     name: "John",
     address: {
       type: "home",
-      city: { __text: "New York" },
+      city: "New York",
     },
   });
 });
@@ -98,24 +92,20 @@ test("Bun.XML.parse - mixed content (text and children)", () => {
 </doc>`;
   const result = Bun.XML.parse(xml);
   expect(result).toEqual({
-    child: { __text: "value" },
+    __children: ["value"],
   });
 });
 
 test("Bun.XML.parse - XML entities", () => {
   const xml = "<message>Hello &lt;world&gt; &amp; &quot;everyone&quot; &#39;here&#39;</message>";
   const result = Bun.XML.parse(xml);
-  expect(result).toEqual({
-    __text: `Hello <world> & "everyone" 'here'`,
-  });
+  expect(result).toEqual(`Hello <world> & "everyone" 'here'`);
 });
 
 test("Bun.XML.parse - numeric entities", () => {
   const xml = "<test>&#65;&#66;&#67;</test>";
   const result = Bun.XML.parse(xml);
-  expect(result).toEqual({
-    __text: "ABC",
-  });
+  expect(result).toEqual("ABC");
 });
 
 test("Bun.XML.parse - entities in attributes", () => {
@@ -123,7 +113,7 @@ test("Bun.XML.parse - entities in attributes", () => {
   const result = Bun.XML.parse(xml);
   expect(result).toEqual({
     attr: "<value>",
-    __text: "content",
+    __children: ["content"],
   });
 });
 
@@ -135,7 +125,7 @@ test("Bun.XML.parse - XML comments are ignored", () => {
   </root>`;
   const result = Bun.XML.parse(xml);
   expect(result).toEqual({
-    message: { __text: "Hello" },
+    message: "Hello",
   });
 });
 
@@ -143,16 +133,14 @@ test("Bun.XML.parse - duplicate tags become arrays", () => {
   const xml = "<root><item>1</item><item>2</item></root>";
   const result = Bun.XML.parse(xml);
   expect(result).toEqual({
-    item: [{ __text: "1" }, { __text: "2" }],
+    item: ["1", "2"],
   });
 });
 
 test("Bun.XML.parse - CDATA sections", () => {
   const xml = '<message><![CDATA[Hello <world> & "everyone"]]></message>';
   const result = Bun.XML.parse(xml);
-  expect(result).toEqual({
-    __text: `Hello <world> & "everyone"`,
-  });
+  expect(result).toEqual(`Hello <world> & "everyone"`);
 });
 
 test("Bun.XML.parse - top-level comments are ignored", () => {
@@ -160,9 +148,7 @@ test("Bun.XML.parse - top-level comments are ignored", () => {
   <root>content</root>
   <!-- Another top comment -->`;
   const result = Bun.XML.parse(xml);
-  expect(result).toEqual({
-    __text: "content",
-  });
+  expect(result).toEqual("content");
 });
 
 test("Bun.XML.parse - mismatched closing tag throws error", () => {