diff --git a/CHANGELOG.md b/CHANGELOG.md
index d9369950d..f8991cdac 100644
--- a/CHANGELOG.md
+++ b/CHANGELOG.md
@@ -20,6 +20,7 @@
 - Make from completion trigger for expr hole so we get a nice experience when completing {from: <com>} in `@module`. https://github.com/rescript-lang/rescript-vscode/pull/918
 - Latest parser for newest syntax features. https://github.com/rescript-lang/rescript-vscode/pull/917
 - Handle completion for DOM/element attributes and attribute values properly when using a generic JSX transform. https://github.com/rescript-lang/rescript-vscode/pull/919
+- Highlight tagged template literal functions as functions. https://github.com/rescript-lang/rescript-vscode/pull/920
 
 ## 1.38.0
 
diff --git a/grammars/rescript.tmLanguage.json b/grammars/rescript.tmLanguage.json
index 085e3ef5d..3c3e6f0da 100644
--- a/grammars/rescript.tmLanguage.json
+++ b/grammars/rescript.tmLanguage.json
@@ -148,7 +148,7 @@
           "end": "(?<!\\\\)`",
           "beginCaptures": {
             "1": {
-              "name": "variables.annotation"
+              "name": "entity.name.function"
             },
             "2": {
               "name": "punctuation.definition.string.template.begin"