diff --git a/Services/FileManagerService.qml b/Services/FileManagerService.qml
index 742e4c1c..a6288e7a 100644
--- a/Services/FileManagerService.qml
+++ b/Services/FileManagerService.qml
@@ -10,9 +10,20 @@ QtObject {
   function open(options) {
     var component = Qt.createComponent(Qt.resolvedUrl(Quickshell.shellDir + "/Widgets/NFileManager.qml"))
     if (component.status === Component.Ready) {
+      // Extract directory from file path if it's a file
+      var initialPath = options.initialPath || Quickshell.env("HOME")
+      if (options.selectFiles && initialPath !== Quickshell.env("HOME")) {
+        // If selecting files and path is not home, extract directory
+        var pathParts = initialPath.split('/')
+        if (pathParts.length > 1) {
+          pathParts.pop() // Remove filename
+          initialPath = pathParts.join('/') || '/'
+        }
+      }
+
       var dialog = component.createObject(options.parent || Overlay.overlay, {
                                             "title": options.title || "Select File/Folder",
-                                            "initialPath": options.initialPath || Quickshell.env("HOME"),
+                                            "initialPath": initialPath,
                                             "selectFiles": options.selectFiles || false,
                                             "selectFolders": !options.selectFiles || false,
                                             "scaling": options.scaling || 1.0
diff --git a/Widgets/NFileManager.qml b/Widgets/NFileManager.qml
index 38bfaf12..cd5805b8 100644
--- a/Widgets/NFileManager.qml
+++ b/Widgets/NFileManager.qml
@@ -600,11 +600,57 @@ Popup {
                 Layout.preferredHeight: Math.round(gridView.itemSize * 0.67)
                 color: Color.transparent
 
+                // Check if file is an image
+                property bool isImage: {
+                  if (isDirectory)
+                    return false
+                  var ext = fileName.split('.').pop().toLowerCase()
+                  return ['jpg', 'jpeg', 'png', 'gif', 'bmp', 'webp', 'svg', 'ico'].includes(ext)
+                }
+
+                // Show thumbnail for images, icon for others
+                Image {
+                  id: thumbnail
+                  anchors.fill: parent
+                  anchors.margins: Style.marginXS * scaling
+                  source: iconContainer.isImage ? "file://" + filePath : ""
+                  fillMode: Image.PreserveAspectFit
+                  visible: iconContainer.isImage && status === Image.Ready
+                  smooth: false // Disable smooth for faster rendering
+                  cache: true
+                  asynchronous: true // Load images asynchronously
+                  sourceSize.width: 120 * scaling // Limit image size for faster loading
+                  sourceSize.height: 120 * scaling
+
+                  // Fallback to icon if image fails to load or takes too long
+                  onStatusChanged: {
+                    if (status === Image.Error) {
+                      visible = false
+                    }
+                  }
+
+                  // Show loading indicator while image loads
+                  Rectangle {
+                    anchors.fill: parent
+                    color: Color.mSurfaceVariant
+                    radius: Style.radiusS * scaling
+                    visible: thumbnail.status === Image.Loading
+
+                    NIcon {
+                      icon: "photo"
+                      font.pointSize: Style.fontSizeL * scaling
+                      color: Color.mOnSurfaceVariant
+                      anchors.centerIn: parent
+                    }
+                  }
+                }
+
                 NIcon {
                   icon: isDirectory ? "folder" : root.getFileIcon(fileName)
                   font.pointSize: Style.fontSizeXXL * scaling
                   color: isDirectory ? Color.mPrimary : Color.mOnSurfaceVariant
                   anchors.centerIn: parent
+                  visible: !iconContainer.isImage || thumbnail.status !== Image.Ready
                 }
 
                 // Selection indicator (like WallpaperSelector)