diff --git a/.changeset/fix-catalog-tags-spacing.md b/.changeset/fix-catalog-tags-spacing.md
new file mode 100644
index 0000000000..6e2540fa0b
--- /dev/null
+++ b/.changeset/fix-catalog-tags-spacing.md
@@ -0,0 +1,5 @@
+---
+'@backstage/plugin-catalog': patch
+---
+
+Fixed vertical spacing between tags in the catalog table. Tags now have consistent 2px margin to prevent border overlap when wrapped to multiple lines.
diff --git a/plugins/catalog/src/components/CatalogTable/columns.tsx b/plugins/catalog/src/components/CatalogTable/columns.tsx
index 65094bc568..d2216149cd 100644
--- a/plugins/catalog/src/components/CatalogTable/columns.tsx
+++ b/plugins/catalog/src/components/CatalogTable/columns.tsx
@@ -174,7 +174,7 @@ export const columnFactories = Object.freeze({
                 label={t}
                 size="small"
                 variant="outlined"
-                style={{ marginBottom: '0px' }}
+                style={{ margin: '2px' }}
               />
             ))}
         </>