diff --git a/clang-tools-extra/clangd/SemanticHighlighting.cpp b/clang-tools-extra/clangd/SemanticHighlighting.cpp
--- a/clang-tools-extra/clangd/SemanticHighlighting.cpp
+++ b/clang-tools-extra/clangd/SemanticHighlighting.cpp
@@ -221,23 +221,51 @@
       // the end of the Tokens).
       TokRef = TokRef.drop_front(Conflicting.size());
     }
+    const auto &SM = AST.getSourceManager();
+    StringRef MainCode = SM.getBuffer(SM.getMainFileID())->getBuffer();
     // Add tokens indicating lines skipped by the preprocessor.
     for (const Range &R : AST.getMacros().SkippedRanges) {
       // Create one token for each line in the skipped range, so it works
       // with line-based diffing.
       assert(R.start.line <= R.end.line);
       for (int Line = R.start.line; Line <= R.end.line; ++Line) {
-        // Don't bother computing the offset for the end of the line, just use
-        // zero. The client will treat this highlighting kind specially, and
-        // highlight the entire line visually (i.e. not just to where the text
-        // on the line ends, but to the end of the screen).
-        NonConflicting.push_back({HighlightingKind::InactiveCode,
-                                  {Position{Line, 0}, Position{Line, 0}}});
+        auto StartOfLine = positionToOffset(MainCode, Position{Line, 0});
+        if (!StartOfLine) {
+          elog("Failed to convert position to offset: {0}",
+               StartOfLine.takeError());
+          continue;
+        }
+        StringRef LineText =
+            MainCode.drop_front(*StartOfLine).take_until([](char C) {
+              return C == '\n';
+            });
+        NonConflicting.push_back(
+            {HighlightingKind::InactiveCode,
+             {Position{Line, 0},
+              Position{Line, static_cast<int>(lspLength(LineText))}}});
       }
     }
     // Re-sort the tokens because that's what the diffing expects.
     llvm::sort(NonConflicting);
-    return NonConflicting;
+    std::vector<HighlightingToken> Results;
+    // Remove tokens that are overlapped with an inactive region, e.g.
+    // `#ifndef Foo` is considered as part of an inactive region when Foo is
+    // defined, and there is a Foo macro token.
+    // FIXME: we should reduce the scope of the inactive region to not include
+    // the directive itself.
+    for (ArrayRef<HighlightingToken> TokRef = NonConflicting;
+         !TokRef.empty();) {
+      ArrayRef<HighlightingToken> ContainedTokens =
+          TokRef.take_while([&](const HighlightingToken &T) {
+            return TokRef.front().R.contains(T.R);
+          });
+      assert(ContainedTokens.size() == 1 ||
+             (ContainedTokens.size() > 1 &&
+              TokRef.front().Kind == HighlightingKind::InactiveCode));
+      Results.push_back(ContainedTokens.front());
+      TokRef = TokRef.drop_front(ContainedTokens.size());
+    }
+    return Results;
   }
 
 private:
@@ -493,9 +521,6 @@
   std::vector<SemanticToken> Result;
   const HighlightingToken *Last = nullptr;
   for (const HighlightingToken &Tok : Tokens) {
-    // FIXME: support inactive code - we need to provide the actual bounds.
-    if (Tok.Kind == HighlightingKind::InactiveCode)
-      continue;
     Result.emplace_back();
     SemanticToken &Out = Result.back();
     // deltaStart/deltaLine are relative if possible.
diff --git a/clang-tools-extra/clangd/unittests/SemanticHighlightingTests.cpp b/clang-tools-extra/clangd/unittests/SemanticHighlightingTests.cpp
--- a/clang-tools-extra/clangd/unittests/SemanticHighlightingTests.cpp
+++ b/clang-tools-extra/clangd/unittests/SemanticHighlightingTests.cpp
@@ -503,11 +503,11 @@
 
       #define $Macro[[test]]
       #undef $Macro[[test]]
-$InactiveCode[[]]      #ifdef $Macro[[test]]
-$InactiveCode[[]]      #endif
+$InactiveCode[[#ifdef test]]
+$InactiveCode[[#endif]]
 
-$InactiveCode[[]]      #if defined($Macro[[test]])
-$InactiveCode[[]]      #endif
+$InactiveCode[[#if defined(test)]]
+$InactiveCode[[#endif]]
     )cpp",
       R"cpp(
       struct $Class[[S]] {
@@ -614,8 +614,8 @@
       R"cpp(
       // Code in the preamble.
       // Inactive lines get an empty InactiveCode token at the beginning.
-$InactiveCode[[]]      #ifdef $Macro[[test]]
-$InactiveCode[[]]      #endif
+$InactiveCode[[#ifdef test]]
+$InactiveCode[[#endif]]
 
       // A declaration to cause the preamble to end.
       int $Variable[[EndPreamble]];
@@ -623,17 +623,17 @@
       // Code after the preamble.
       // Code inside inactive blocks does not get regular highlightings
       // because it's not part of the AST.
-$InactiveCode[[]]      #ifdef $Macro[[test]]
-$InactiveCode[[]]      int Inactive2;
-$InactiveCode[[]]      #endif
+$InactiveCode[[#ifdef test]]
+$InactiveCode[[int Inactive2;]]
+$InactiveCode[[#endif]]
 
       #ifndef $Macro[[test]]
       int $Variable[[Active1]];
       #endif
 
-$InactiveCode[[]]      #ifdef $Macro[[test]]
-$InactiveCode[[]]      int Inactive3;
-$InactiveCode[[]]      #else
+$InactiveCode[[#ifdef test]]
+$InactiveCode[[int Inactive3;]]
+$InactiveCode[[#else]]
       int $Variable[[Active2]];
       #endif
     )cpp",