diff --git a/src/managers/ColumnDetector.ts b/src/managers/ColumnDetector.ts
index 9b71ac6..9255dab 100644
--- a/src/managers/ColumnDetector.ts
+++ b/src/managers/ColumnDetector.ts
@@ -120,8 +120,8 @@ export class ColumnDetector {
         });
         this.lastLoggedPosition = { x: event.clientX, y: event.clientY };
         
-        // Snap klonens position til nærmeste 15-min interval
-        if (this.draggedClone && this.draggedClone.parentElement) {
+        // Snap klonens position til nærmeste 15-min interval (only for timed events)
+        if (this.draggedClone && this.draggedClone.parentElement && this.draggedClone.tagName !== 'SWP-ALLDAY-EVENT') {
           const columnRect = this.draggedClone.parentElement.getBoundingClientRect();
           const rawRelativeY = event.clientY - columnRect.top - this.mouseOffset.y;
           
@@ -131,8 +131,8 @@ export class ColumnDetector {
         }
       }
       
-      // Kontinuerlig opdatering under auto-scroll for at sikre klonen følger musen
-      if (this.draggedClone && this.draggedClone.parentElement && this.autoScrollAnimationId !== null) {
+      // Kontinuerlig opdatering under auto-scroll for at sikre klonen følger musen (only for timed events)
+      if (this.draggedClone && this.draggedClone.parentElement && this.autoScrollAnimationId !== null && this.draggedClone.tagName !== 'SWP-ALLDAY-EVENT') {
         const columnRect = this.draggedClone.parentElement.getBoundingClientRect();
         const relativeY = event.clientY - columnRect.top - this.mouseOffset.y;
         this.draggedClone.style.top = relativeY + 'px';
@@ -176,8 +176,8 @@ export class ColumnDetector {
         console.log('Entered column:', date);
         this.currentColumn = date;
         
-        // Flyt klonen til ny kolonne ved kolonneskift
-        if (this.draggedClone && this.isMouseDown) {
+        // Flyt klonen til ny kolonne ved kolonneskift (only for timed events)
+        if (this.draggedClone && this.isMouseDown && this.draggedClone.tagName !== 'SWP-ALLDAY-EVENT') {
           // Flyt klonen til den nye kolonne
           const newColumnElement = document.querySelector(`swp-day-column[data-date="${date}"]`);
           if (newColumnElement) {
@@ -411,8 +411,8 @@ export class ColumnDetector {
       const scrollAmount = direction === 'up' ? -this.scrollSpeed : this.scrollSpeed;
       this.scrollContainer.scrollTop += scrollAmount;
       
-      // Update clone position based on current mouse position after scroll
-      if (this.draggedClone && this.draggedClone.parentElement) {
+      // Update clone position based on current mouse position after scroll (only for timed events)
+      if (this.draggedClone && this.draggedClone.parentElement && this.draggedClone.tagName !== 'SWP-ALLDAY-EVENT') {
         const columnRect = this.draggedClone.parentElement.getBoundingClientRect();
         const relativeY = this.currentMouseY - columnRect.top - this.mouseOffset.y;
         this.draggedClone.style.top = relativeY + 'px';
@@ -467,12 +467,33 @@ export class ColumnDetector {
     const titleElement = clone.querySelector('swp-event-title');
     const eventTitle = titleElement ? titleElement.textContent || 'Untitled Event' : 'Untitled Event';
     
+    // Calculate which column this date corresponds to
+    const dayHeaders = document.querySelectorAll('swp-day-header');
+    let columnIndex = 1; // Default to first column
+    
+    dayHeaders.forEach((header, index) => {
+      if ((header as HTMLElement).dataset.date === targetDate) {
+        columnIndex = index + 1; // 1-based grid index
+      }
+    });
+
     // Create new all-day event element
     const allDayEvent = document.createElement('swp-allday-event');
     allDayEvent.setAttribute('data-event-id', clone.dataset.eventId || '');
     allDayEvent.setAttribute('data-type', clone.dataset.type || 'work');
     allDayEvent.textContent = eventTitle;
     
+    // Position event in correct column and find available row
+    (allDayEvent as HTMLElement).style.gridColumn = columnIndex.toString();
+    
+    // Find first available row (simple assignment to row 1 for dropped events)
+    (allDayEvent as HTMLElement).style.gridRow = '1';
+    
+    // Clear any positioning styles from the original timed event (top, left, position, etc.)
+    (allDayEvent as HTMLElement).style.top = '';
+    (allDayEvent as HTMLElement).style.left = '';
+    (allDayEvent as HTMLElement).style.position = '';
+    
     // Remove the original clone from its current parent
     if (clone.parentElement) {
       clone.parentElement.removeChild(clone);
@@ -530,19 +551,11 @@ export class ColumnDetector {
       return null;
     }
     
-    // Look for existing container for this single column
-    const containerKey = `${columnIndex}-1`; // single column span
-    let container = calendarHeader.querySelector(`swp-allday-container[data-container-key="${containerKey}"]`);
-    
+    // Find the all-day container
+    const container = calendarHeader.querySelector('swp-allday-container');
     if (!container) {
-      // Create new container
-      container = document.createElement('swp-allday-container');
-      container.setAttribute('data-container-key', containerKey);
-      container.setAttribute('data-date', targetDate);
-      (container as HTMLElement).style.gridColumn = `${columnIndex}`;
-      (container as HTMLElement).style.gridRow = '2'; // All-day row
-      calendarHeader.appendChild(container);
-      
+      console.warn('ColumnDetector: No swp-allday-container found - HeaderRenderer should create this');
+      return null;
     }
     
     return container as HTMLElement;
@@ -550,33 +563,39 @@ export class ColumnDetector {
 
 
   /**
-   * Recalculate all-day row height based on maximum events in any container
+   * Recalculate all-day row height based on number of rows in use
    */
   private recalculateAllDayHeight(): void {
     const calendarHeader = document.querySelector('swp-calendar-header') as HTMLElement;
     if (!calendarHeader) return;
     
-    // Find all all-day containers
-    const allDayContainers = calendarHeader.querySelectorAll('swp-allday-container');
-    let maxStackHeight = 0;
+    // Find all-day container
+    const allDayContainer = calendarHeader.querySelector('swp-allday-container');
+    if (!allDayContainer) {
+      console.warn('ColumnDetector: No swp-allday-container found for height recalculation');
+      return;
+    }
     
-    // Count events in each container to find maximum
-    allDayContainers.forEach(container => {
-      const eventCount = container.querySelectorAll('swp-allday-event').length;
-      if (eventCount > maxStackHeight) {
-        maxStackHeight = eventCount;
+    // Count highest row used by any event
+    const events = allDayContainer.querySelectorAll('swp-allday-event');
+    let maxRow = 1;
+    
+    events.forEach(event => {
+      const gridRow = (event as HTMLElement).style.gridRow;
+      if (gridRow) {
+        const rowNum = parseInt(gridRow);
+        if (rowNum > maxRow) {
+          maxRow = rowNum;
+        }
       }
     });
     
-    // Calculate new height using same formula as EventRenderer
-    const calculatedHeight = maxStackHeight > 0 
-      ? (maxStackHeight * ALL_DAY_CONSTANTS.EVENT_HEIGHT) + 
-        ((maxStackHeight - 1) * ALL_DAY_CONSTANTS.EVENT_GAP) + 
-        ALL_DAY_CONSTANTS.CONTAINER_PADDING
-      : ALL_DAY_CONSTANTS.SINGLE_ROW_HEIGHT; // Keep minimum height
+    // Calculate new height
+    const root = document.documentElement;
+    const eventHeight = parseInt(getComputedStyle(root).getPropertyValue('--allday-event-height') || '26');
+    const calculatedHeight = maxRow * eventHeight;
     
     // Get current heights for animation
-    const root = document.documentElement;
     const headerHeight = parseInt(getComputedStyle(root).getPropertyValue('--header-height'));
     const currentAllDayHeight = parseInt(getComputedStyle(root).getPropertyValue('--all-day-row-height') || '0');
     const currentTotalHeight = headerHeight + currentAllDayHeight;
@@ -620,7 +639,7 @@ export class ColumnDetector {
         eventBus.emit('header:height-changed');
       });
       
-      console.log(`Animated all-day height: ${currentAllDayHeight}px → ${calculatedHeight}px (max stack: ${maxStackHeight})`);
+      console.log(`Animated all-day height: ${currentAllDayHeight}px → ${calculatedHeight}px (max stack: ${maxRow})`);
     }
   }
 
diff --git a/src/renderers/EventRenderer.ts b/src/renderers/EventRenderer.ts
index f3ff195..e2fce03 100644
--- a/src/renderers/EventRenderer.ts
+++ b/src/renderers/EventRenderer.ts
@@ -71,7 +71,7 @@ export abstract class BaseEventRenderer implements EventRendererStrategy {
    * Render all-day events in the header row 2
    */
   protected renderAllDayEvents(allDayEvents: CalendarEvent[], container: HTMLElement, config: CalendarConfig): void {
-    console.log(`BaseEventRenderer: Rendering ${allDayEvents.length} all-day events`);
+    console.log(`BaseEventRenderer: Rendering ${allDayEvents.length} all-day events using nested grid`);
     
     // Find the calendar header
     const calendarHeader = container.querySelector('swp-calendar-header');
@@ -79,131 +79,97 @@ export abstract class BaseEventRenderer implements EventRendererStrategy {
       console.warn('BaseEventRenderer: No calendar header found for all-day events');
       return;
     }
-    
-    // Clear content of existing all-day containers (but keep the containers)
-    const existingContainers = calendarHeader.querySelectorAll('swp-allday-container');
-    existingContainers.forEach(container => {
-      container.innerHTML = ''; // Clear content, keep container
-    });
-    
-    // Track maximum number of stacked events to calculate row height
-    let maxStackHeight = 0;
 
-    // Get day headers to build date map
+    // Find the all-day container
+    const allDayContainer = calendarHeader.querySelector('swp-allday-container') as HTMLElement;
+    if (!allDayContainer) {
+      console.warn('BaseEventRenderer: No swp-allday-container found - HeaderRenderer should create this');
+      return;
+    }
+
+    // Clear existing events
+    allDayContainer.innerHTML = '';
+
+    if (allDayEvents.length === 0) {
+      // No events - just return
+      this.updateAllDayHeight(1);
+      return;
+    }
+
+    // Build date to column mapping
     const dayHeaders = calendarHeader.querySelectorAll('swp-day-header');
     const dateToColumnMap = new Map<string, number>();
-    const visibleDates: string[] = [];
     
     dayHeaders.forEach((header, index) => {
       const dateStr = (header as any).dataset.date;
       if (dateStr) {
         dateToColumnMap.set(dateStr, index + 1); // 1-based column index
-        visibleDates.push(dateStr);
       }
     });
 
-    // Group events by their start column for container creation
-    const eventsByStartColumn = new Map<number, CalendarEvent[]>();
+    // Calculate grid spans for all events
+    const eventSpans = allDayEvents.map(event => ({
+      event,
+      span: this.calculateEventGridSpan(event, dateToColumnMap)
+    })).filter(item => item.span.columnSpan > 0); // Remove events outside visible range
+
+    // Simple row assignment using overlap detection
+    const eventPlacements: Array<{ event: CalendarEvent, span: { startColumn: number, columnSpan: number }, row: number }> = [];
     
-    allDayEvents.forEach(event => {
-      const startDate = new Date(event.start);
-      const startDateKey = this.dateCalculator.formatISODate(startDate);
-      const startColumn = dateToColumnMap.get(startDateKey);
+    eventSpans.forEach(eventItem => {
+      let assignedRow = 1;
       
-      if (!startColumn) {
-        console.log(`BaseEventRenderer: Event "${event.title}" starts outside visible week`);
-        return;
+      // Find first row where this event doesn't overlap with any existing event
+      while (true) {
+        const rowEvents = eventPlacements.filter(item => item.row === assignedRow);
+        const hasOverlap = rowEvents.some(rowEvent => 
+          this.eventsOverlap(eventItem.span, rowEvent.span)
+        );
+        
+        if (!hasOverlap) {
+          break; // Found available row
+        }
+        assignedRow++;
       }
       
-      // Store event with its start column
-      if (!eventsByStartColumn.has(startColumn)) {
-        eventsByStartColumn.set(startColumn, []);
-      }
-      eventsByStartColumn.get(startColumn)!.push(event);
-    });
-
-    // Create containers and render events
-    eventsByStartColumn.forEach((events, startColumn) => {
-      events.forEach(event => {
-        const startDate = new Date(event.start);
-        const endDate = new Date(event.end);
-        
-        // Calculate span
-        let endColumn = startColumn;
-        const currentDate = new Date(startDate);
-        
-        while (currentDate <= endDate) {
-          currentDate.setDate(currentDate.getDate() + 1);
-          const dateKey = this.dateCalculator.formatISODate(currentDate);
-          const col = dateToColumnMap.get(dateKey);
-          if (col) {
-            endColumn = col;
-          } else {
-            break;
-          }
-        }
-        
-        const columnSpan = endColumn - startColumn + 1;
-        let allDayContainer: Element | null = null;
-
-        if (columnSpan === 1) {
-          // Single day event - use existing single-day container
-          const containerKey = `${startColumn}-1`;
-          allDayContainer = calendarHeader.querySelector(`swp-allday-container[data-container-key="${containerKey}"]`);
-        } else {
-          // Multi-day event - create or find spanning container
-          const containerKey = `${startColumn}-${columnSpan}`;
-          allDayContainer = calendarHeader.querySelector(`swp-allday-container[data-container-key="${containerKey}"]`);
-          
-          if (!allDayContainer) {
-            // Create container that spans the appropriate columns
-            allDayContainer = document.createElement('swp-allday-container');
-            allDayContainer.setAttribute('data-container-key', containerKey);
-            allDayContainer.setAttribute('data-date', this.dateCalculator.formatISODate(startDate));
-            (allDayContainer as HTMLElement).style.gridColumn = `${startColumn} / span ${columnSpan}`;
-            (allDayContainer as HTMLElement).style.gridRow = '2';
-            calendarHeader.appendChild(allDayContainer);
-          }
-        }
-
-        if (!allDayContainer) {
-          console.warn(`BaseEventRenderer: No container found for event "${event.title}"`);
-          return;
-        }
-        
-        // Create the all-day event element inside container
-        const allDayEvent = document.createElement('swp-allday-event');
-        allDayEvent.textContent = event.title;
-        allDayEvent.setAttribute('data-event-id', event.id);
-        allDayEvent.setAttribute('data-type', event.type || 'work');
-        
-        // Use event metadata for color if available
-        if (event.metadata?.color) {
-          (allDayEvent as HTMLElement).style.backgroundColor = event.metadata.color;
-        }
-        
-        console.log(`BaseEventRenderer: All-day event "${event.title}" in container spanning columns ${startColumn} to ${endColumn}`);
-        
-        allDayContainer.appendChild(allDayEvent);
-        
-        // Track max stack height
-        const containerEventCount = allDayContainer.querySelectorAll('swp-allday-event').length;
-        if (containerEventCount > maxStackHeight) {
-          maxStackHeight = containerEventCount;
-        }
+      eventPlacements.push({
+        event: eventItem.event,
+        span: eventItem.span,
+        row: assignedRow
       });
     });
+
+    // Get max row needed
+    const maxRow = Math.max(...eventPlacements.map(item => item.row), 1);
+
+    // Place events directly in the single container
+    eventPlacements.forEach(({ event, span, row }) => {
+      // Create the all-day event element
+      const allDayEvent = document.createElement('swp-allday-event');
+      allDayEvent.textContent = event.title;
+      allDayEvent.setAttribute('data-event-id', event.id);
+      allDayEvent.setAttribute('data-type', event.type || 'work');
+      
+      // Set grid position (column and row)
+      (allDayEvent as HTMLElement).style.gridColumn = span.columnSpan > 1 
+        ? `${span.startColumn} / span ${span.columnSpan}`
+        : `${span.startColumn}`;
+      (allDayEvent as HTMLElement).style.gridRow = row.toString();
+
+      // Use event metadata for color if available
+      if (event.metadata?.color) {
+        (allDayEvent as HTMLElement).style.backgroundColor = event.metadata.color;
+      }
+      
+      allDayContainer.appendChild(allDayEvent);
+      
+      console.log(`BaseEventRenderer: Placed "${event.title}" in row ${row}, columns ${span.startColumn} to ${span.startColumn + span.columnSpan - 1}`);
+    });
+
+    // Update height based on max row
+    this.updateAllDayHeight(maxRow);
     
-    // Calculate and set the all-day row height based on max stack
-    const calculatedHeight = maxStackHeight > 0 
-      ? (maxStackHeight * ALL_DAY_CONSTANTS.EVENT_HEIGHT) + ((maxStackHeight - 1) * ALL_DAY_CONSTANTS.EVENT_GAP) + ALL_DAY_CONSTANTS.CONTAINER_PADDING
-      : 0; // No height if no events
-    
-    // Only set CSS variable - header-spacer height is handled by CSS calc()
-    const root = document.documentElement;
-    root.style.setProperty('--all-day-row-height', `${calculatedHeight}px`);
-    
-    console.log(`BaseEventRenderer: Set all-day row height to ${calculatedHeight}px (max stack: ${maxStackHeight})`);
+    console.log(`BaseEventRenderer: Created ${maxRow} rows with auto-expanding grid`);
   }
 
   protected renderEvent(event: CalendarEvent, container: Element, config: CalendarConfig): void {
@@ -284,6 +250,60 @@ export abstract class BaseEventRenderer implements EventRendererStrategy {
     return `${displayHour}:${minutes.toString().padStart(2, '0')} ${period}`;
   }
 
+  /**
+   * Update all-day row height based on number of rows
+   */
+  private updateAllDayHeight(maxRows: number): void {
+    const root = document.documentElement;
+    const eventHeight = parseInt(getComputedStyle(root).getPropertyValue('--allday-event-height') || '26');
+    const calculatedHeight = maxRows * eventHeight;
+    root.style.setProperty('--all-day-row-height', `${calculatedHeight}px`);
+    
+    console.log(`BaseEventRenderer: Set all-day height to ${calculatedHeight}px for ${maxRows} rows`);
+  }
+
+  /**
+   * Calculate grid column span for event
+   */
+  private calculateEventGridSpan(event: CalendarEvent, dateToColumnMap: Map<string, number>): { startColumn: number, columnSpan: number } {
+    const startDate = new Date(event.start);
+    const endDate = new Date(event.end);
+    const startDateKey = this.dateCalculator.formatISODate(startDate);
+    const startColumn = dateToColumnMap.get(startDateKey);
+    
+    if (!startColumn) {
+      return { startColumn: 0, columnSpan: 0 }; // Event outside visible range
+    }
+
+    // Calculate span by checking each day
+    let endColumn = startColumn;
+    const currentDate = new Date(startDate);
+    
+    while (currentDate <= endDate) {
+      currentDate.setDate(currentDate.getDate() + 1);
+      const dateKey = this.dateCalculator.formatISODate(currentDate);
+      const col = dateToColumnMap.get(dateKey);
+      if (col) {
+        endColumn = col;
+      } else {
+        break; // Event extends beyond visible range
+      }
+    }
+    
+    const columnSpan = endColumn - startColumn + 1;
+    return { startColumn, columnSpan };
+  }
+
+  /**
+   * Check if two events overlap in columns
+   */
+  private eventsOverlap(event1Span: { startColumn: number, columnSpan: number }, event2Span: { startColumn: number, columnSpan: number }): boolean {
+    const event1End = event1Span.startColumn + event1Span.columnSpan - 1;
+    const event2End = event2Span.startColumn + event2Span.columnSpan - 1;
+    
+    return !(event1End < event2Span.startColumn || event2End < event1Span.startColumn);
+  }
+
   clearEvents(container?: HTMLElement): void {
     const selector = 'swp-event';
     const existingEvents = container 
diff --git a/src/renderers/GridRenderer.ts b/src/renderers/GridRenderer.ts
index 7bffc23..7805472 100644
--- a/src/renderers/GridRenderer.ts
+++ b/src/renderers/GridRenderer.ts
@@ -200,8 +200,28 @@ export class GridRenderer {
       const allDayContainer = target.closest('swp-allday-container');
       
       if (dayHeader || allDayContainer) {
-        const hoveredElement = dayHeader || allDayContainer;
-        const targetDate = (hoveredElement as HTMLElement).dataset.date;
+        let hoveredElement: HTMLElement;
+        let targetDate: string | undefined;
+        
+        if (dayHeader) {
+          hoveredElement = dayHeader as HTMLElement;
+          targetDate = hoveredElement.dataset.date;
+        } else if (allDayContainer) {
+          // For all-day areas, we need to determine which day column we're over
+          hoveredElement = allDayContainer as HTMLElement;
+          
+          // Calculate which day we're hovering over based on mouse position
+          const headerRect = calendarHeader.getBoundingClientRect();
+          const dayHeaders = calendarHeader.querySelectorAll('swp-day-header');
+          const mouseX = (event as MouseEvent).clientX - headerRect.left;
+          const dayWidth = headerRect.width / dayHeaders.length;
+          const dayIndex = Math.floor(mouseX / dayWidth);
+          
+          const targetDayHeader = dayHeaders[dayIndex] as HTMLElement;
+          targetDate = targetDayHeader?.dataset.date;
+        } else {
+          return; // No valid element found
+        }
         
         console.log('GridRenderer: Detected hover over:', {
           elementType: dayHeader ? 'day-header' : 'all-day-container',
diff --git a/src/renderers/HeaderRenderer.ts b/src/renderers/HeaderRenderer.ts
index 469e797..2428d06 100644
--- a/src/renderers/HeaderRenderer.ts
+++ b/src/renderers/HeaderRenderer.ts
@@ -38,7 +38,7 @@ export abstract class BaseHeaderRenderer implements HeaderRenderer {
   }
 
   /**
-   * Ensure all-day containers exist for all days (called automatically after header render)
+   * Ensure all-day main container and initial stack level exist (called automatically after header render)
    */
   ensureAllDayContainers(calendarHeader: HTMLElement): void {
     const root = document.documentElement;
@@ -49,10 +49,10 @@ export abstract class BaseHeaderRenderer implements HeaderRenderer {
       root.style.setProperty('--all-day-row-height', `${ALL_DAY_CONSTANTS.SINGLE_ROW_HEIGHT}px`);
     }
 
-    // Always ensure containers exist for all days
-    this.createEmptyAllDayContainers(calendarHeader);
+    // Always ensure main container and initial stack level exist
+    this.createAllDayMainStructure(calendarHeader);
     
-    console.log('BaseHeaderRenderer: Ensured all-day containers exist for all days');
+    console.log('BaseHeaderRenderer: Ensured all-day main structure exists');
   }
 
   private animateHeaderExpansion(calendarHeader: HTMLElement): void {
@@ -93,39 +93,25 @@ export abstract class BaseHeaderRenderer implements HeaderRenderer {
       // Set the CSS variable after animation
       root.style.setProperty('--all-day-row-height', `${ALL_DAY_CONSTANTS.SINGLE_ROW_HEIGHT}px`);
       
-      // Create empty all-day containers after animation
-      this.createEmptyAllDayContainers(calendarHeader);
+      // Create all-day main structure after animation
+      this.createAllDayMainStructure(calendarHeader);
       
       // Notify ScrollManager about header height change
       eventBus.emit('header:height-changed');
     });
   }
 
-  private createEmptyAllDayContainers(calendarHeader: HTMLElement): void {
-    const dayHeaders = calendarHeader.querySelectorAll('swp-day-header');
+  private createAllDayMainStructure(calendarHeader: HTMLElement): void {
+    // Check if container already exists
+    let container = calendarHeader.querySelector('swp-allday-container');
     
-    dayHeaders.forEach((dayHeader, index) => {
-      const date = (dayHeader as HTMLElement).dataset.date;
-      if (!date) return;
-      
-      const columnIndex = index + 1; // 1-based grid index
-      const containerKey = `${columnIndex}-1`;
-      
-      // Check if container already exists
-      let container = calendarHeader.querySelector(`swp-allday-container[data-container-key="${containerKey}"]`);
-      
-      if (!container) {
-        // Create empty container
-        container = document.createElement('swp-allday-container');
-        container.setAttribute('data-container-key', containerKey);
-        container.setAttribute('data-date', date);
-        (container as HTMLElement).style.gridColumn = `${columnIndex}`;
-        (container as HTMLElement).style.gridRow = '2';
-        calendarHeader.appendChild(container);
-      }
-    });
+    if (!container) {
+      // Create simple all-day container
+      container = document.createElement('swp-allday-container');
+      calendarHeader.appendChild(container);
+    }
     
-    console.log('Created empty all-day containers for all days');
+    console.log('Created simple all-day container');
   }
 }
 
diff --git a/src/renderers/NavigationRenderer.ts b/src/renderers/NavigationRenderer.ts
index 3810af1..77e864b 100644
--- a/src/renderers/NavigationRenderer.ts
+++ b/src/renderers/NavigationRenderer.ts
@@ -204,8 +204,28 @@ export class NavigationRenderer {
       const allDayContainer = target.closest('swp-allday-container');
       
       if (dayHeader || allDayContainer) {
-        const hoveredElement = dayHeader || allDayContainer;
-        const targetDate = (hoveredElement as HTMLElement).dataset.date;
+        let hoveredElement: HTMLElement;
+        let targetDate: string | undefined;
+        
+        if (dayHeader) {
+          hoveredElement = dayHeader as HTMLElement;
+          targetDate = hoveredElement.dataset.date;
+        } else if (allDayContainer) {
+          // For all-day areas, we need to determine which day column we're over
+          hoveredElement = allDayContainer as HTMLElement;
+          
+          // Calculate which day we're hovering over based on mouse position
+          const headerRect = calendarHeader.getBoundingClientRect();
+          const dayHeaders = calendarHeader.querySelectorAll('swp-day-header');
+          const mouseX = (event as MouseEvent).clientX - headerRect.left;
+          const dayWidth = headerRect.width / dayHeaders.length;
+          const dayIndex = Math.floor(mouseX / dayWidth);
+          
+          const targetDayHeader = dayHeaders[dayIndex] as HTMLElement;
+          targetDate = targetDayHeader?.dataset.date;
+        } else {
+          return; // No valid element found
+        }
         
         console.log('NavigationRenderer: Detected hover over:', {
           elementType: dayHeader ? 'day-header' : 'all-day-container',
diff --git a/wwwroot/css/calendar-base-css.css b/wwwroot/css/calendar-base-css.css
index b033710..28b605c 100644
--- a/wwwroot/css/calendar-base-css.css
+++ b/wwwroot/css/calendar-base-css.css
@@ -17,6 +17,8 @@
   --week-days: 7;
   --header-height: 80px;
   --all-day-row-height: 0px; /* Default height for all-day events row */
+  --allday-event-height: 26px; /* Height of single all-day event including gaps */
+  --stack-levels: 1; /* Number of stack levels for all-day events */
   
   /* Time boundaries - Default fallback values */
   --day-start-hour: 0;
diff --git a/wwwroot/css/calendar-layout-css.css b/wwwroot/css/calendar-layout-css.css
index a09f956..9caf950 100644
--- a/wwwroot/css/calendar-layout-css.css
+++ b/wwwroot/css/calendar-layout-css.css
@@ -267,15 +267,18 @@ swp-day-header[data-today="true"] swp-day-date {
 }
 
 
-/* All-day event container - spans columns as needed */
+/* All-day container - simple container that expands with auto-rows */
 swp-allday-container {
+  grid-column: 1 / -1; /* Span all columns */
+  grid-row: 2; /* Second row of calendar header */
   display: grid;
-  grid-template-columns: 1fr; /* Single column for now, can expand later */
-  grid-auto-rows: min-content;
+  grid-template-columns: repeat(var(--grid-columns, 7), minmax(var(--day-column-min-width), 1fr));
+  grid-auto-rows: var(--allday-event-height, 26px); /* Auto-expand rows as needed */
   gap: 2px;
   padding: 2px;
-  height: 100%;
+  align-items: center;
   overflow: hidden;
+  min-height: var(--allday-event-height, 26px);
 }
 
 /* All-day events in containers */