diff --git a/apps/studio/components/interfaces/ProjectHome/ComputeUpgradeFloatingNotice.tsx b/apps/studio/components/interfaces/ProjectHome/ComputeUpgradeFloatingNotice.tsx
new file mode 100644
index 00000000000..dddbdd0a03b
--- /dev/null
+++ b/apps/studio/components/interfaces/ProjectHome/ComputeUpgradeFloatingNotice.tsx
@@ -0,0 +1,109 @@
+import { LOCAL_STORAGE_KEYS, useParams } from 'common'
+import { useOrgSubscriptionQuery } from 'data/subscriptions/org-subscription-query'
+import { AnimatePresence, motion } from 'framer-motion'
+import { useLocalStorageQuery } from 'hooks/misc/useLocalStorage'
+import { useSelectedOrganizationQuery } from 'hooks/misc/useSelectedOrganization'
+import { useSelectedProjectQuery } from 'hooks/misc/useSelectedProject'
+import { X, Zap } from 'lucide-react'
+import Link from 'next/link'
+import { useState } from 'react'
+import { Button } from 'ui'
+
+export const ComputeUpgradeFloatingNotice = () => {
+  const { ref } = useParams()
+  const { data: project } = useSelectedProjectQuery()
+  const { data: org } = useSelectedOrganizationQuery()
+  const { data: subscription } = useOrgSubscriptionQuery({ orgSlug: org?.slug })
+
+  const [isDismissed, setIsDismissed] = useLocalStorageQuery(
+    LOCAL_STORAGE_KEYS.MICRO_UPGRADE_BANNER_DISMISSED(ref ?? ''),
+    false
+  )
+  const [isHovered, setIsHovered] = useState(false)
+
+  const isProPlan = subscription?.plan.id === 'pro'
+  const isOnNano = project?.infra_compute_size === 'nano'
+
+  if (isDismissed || !isProPlan || !isOnNano) return null
+
+  return (
+    // Outer: positions above badge center + handles float animation
+    <motion.div
+      className="absolute bottom-full left-1/2 mb-2 z-10"
+      style={{ x: '-50%' }}
+      animate={isHovered ? { y: 0 } : { y: [0, -6, 0] }}
+      transition={
+        isHovered
+          ? { duration: 0.2, ease: 'easeOut' }
+          : { duration: 3, repeat: Infinity, ease: 'easeInOut' }
+      }
+      onHoverStart={() => setIsHovered(true)}
+      onHoverEnd={() => setIsHovered(false)}
+    >
+      {/* Inner: expands from center via layout animation */}
+      <motion.div
+        layout
+        className={`relative flex items-center gap-2 rounded-full bg-background backdrop-blur-sm border border-brand-500 shadow-md text-brand-600 ${isHovered ? 'pl-2 pr-3 py-1.5' : 'pl-1 pr-2.5 py-1'} cursor-default overflow-hidden whitespace-nowrap`}
+        transition={{ duration: 0.2, ease: 'easeInOut' }}
+      >
+        <span className="absolute inset-0 bg-brand bg-opacity-10 w-full h-full" />
+
+        <AnimatePresence mode="wait" initial={false}>
+          <motion.div
+            key={isHovered ? 'icon-expanded' : 'icon-collapsed'}
+            layout
+            className={`flex-shrink-0 flex items-center justify-center rounded-full bg-brand-300 text-brand ${isHovered ? 'h-6 w-6' : 'h-4 w-4'}`}
+            initial={{ opacity: 0 }}
+            animate={{ opacity: 1 }}
+            exit={{ opacity: 0 }}
+            transition={{ duration: 0.2, ease: 'easeInOut' }}
+          >
+            <Zap size={isHovered ? 12 : 10} />
+          </motion.div>
+        </AnimatePresence>
+
+        <AnimatePresence mode="wait" initial={false}>
+          {isHovered ? (
+            <motion.div
+              key="expanded"
+              className="flex items-center gap-3"
+              initial={{ opacity: 0 }}
+              animate={{ opacity: 1 }}
+              exit={{ opacity: 0, transition: { duration: 0.3, ease: 'easeInOut' } }}
+              transition={{ duration: 0.25, delay: 0.18 }}
+            >
+              <div className="flex flex-col min-w-0">
+                <span className="text-xs font-medium leading-tight">Upgrade to Micro</span>
+                <span className="text-[11px] text-foreground leading-tight">
+                  Double the memory at no extra cost.
+                </span>
+              </div>
+              <Button asChild type="primary" size="tiny" className="flex-shrink-0 !px-2 !py-1">
+                <Link href={`/project/${ref}/settings/compute-and-disk`}>Upgrade</Link>
+              </Button>
+              <button
+                type="button"
+                onClick={() => setIsDismissed(true)}
+                className="flex-shrink-0 text-brand/50 hover:text-foreground transition-colors h-4 w-4"
+                aria-label="Dismiss"
+              >
+                <X size={12} />
+              </button>
+            </motion.div>
+          ) : (
+            <motion.span
+              key="collapsed"
+              className="text-xs font-medium"
+              initial={{ opacity: 0 }}
+              animate={{ opacity: 1 }}
+              exit={{ opacity: 0, transition: { duration: 0.2, ease: 'easeInOut' } }}
+              transition={{ duration: 0.2, delay: 0.12 }}
+            >
+              Upgrade available!
+            </motion.span>
+          )}
+        </AnimatePresence>
+      </motion.div>
+    </motion.div>
+  )
+}
diff --git a/apps/studio/components/interfaces/ProjectHome/TopSection.tsx b/apps/studio/components/interfaces/ProjectHome/TopSection.tsx
index 659de090a63..ab1c8aada52 100644
--- a/apps/studio/components/interfaces/ProjectHome/TopSection.tsx
+++ b/apps/studio/components/interfaces/ProjectHome/TopSection.tsx
@@ -14,6 +14,7 @@ import { ReactFlowProvider } from 'reactflow'
 import { Badge, cn, Tooltip, TooltipContent, TooltipTrigger } from 'ui'
 
 import { InstanceConfiguration } from '../Settings/Infrastructure/InfrastructureConfiguration/InstanceConfiguration'
+import { ComputeUpgradeFloatingNotice } from './ComputeUpgradeFloatingNotice'
 
 export const TopSection = () => {
   const isOrioleDb = useIsOrioleDb()
@@ -73,12 +74,15 @@ export const TopSection = () => {
                       </TooltipContent>
                     </Tooltip>
                   )}
-                  <ComputeBadgeWrapper
-                    projectRef={project?.ref}
-                    slug={organization?.slug}
-                    cloudProvider={project?.cloud_provider}
-                    computeSize={project?.infra_compute_size}
-                  />
+                  <div className="relative">
+                    <ComputeUpgradeFloatingNotice />
+                    <ComputeBadgeWrapper
+                      projectRef={project?.ref}
+                      slug={organization?.slug}
+                      cloudProvider={project?.cloud_provider}
+                      computeSize={project?.infra_compute_size}
+                    />
+                  </div>
                 </div>
               </div>
               <ProjectConnectionHoverCard projectRef={project?.ref} />
@@ -91,7 +95,7 @@ export const TopSection = () => {
         <div>
           <div
             className={cn(
-              'w-full h-[400px] md:h-[500px] border border-muted rounded-md overflow-hidden flex flex-col relative'
+              'w-full h-[400px] md:h-[500px] border border-muted rounded-md overflow-hidden flex flex-col'
             )}
           >
             <ReactFlowProvider>
diff --git a/apps/studio/components/layouts/DefaultLayout.tsx b/apps/studio/components/layouts/DefaultLayout.tsx
index a09175a8657..afd93883fe9 100644
--- a/apps/studio/components/layouts/DefaultLayout.tsx
+++ b/apps/studio/components/layouts/DefaultLayout.tsx
@@ -1,7 +1,12 @@
 import { LOCAL_STORAGE_KEYS, useParams } from 'common'
 import { AppBannerWrapper } from 'components/interfaces/App/AppBannerWrapper'
 import { Sidebar } from 'components/interfaces/Sidebar'
+import { BannerMicroUpgrade } from 'components/ui/BannerStack/Banners/BannerMicroUpgrade'
+import { useBannerStack } from 'components/ui/BannerStack/BannerStackProvider'
+import { useOrgSubscriptionQuery } from 'data/subscriptions/org-subscription-query'
 import { useLocalStorageQuery } from 'hooks/misc/useLocalStorage'
+import { useSelectedOrganizationQuery } from 'hooks/misc/useSelectedOrganization'
+import { useSelectedProjectQuery } from 'hooks/misc/useSelectedProject'
 import { useCheckLatestDeploy } from 'hooks/use-check-latest-deploy'
 import { useRouter } from 'next/router'
 import { PropsWithChildren, useEffect, useState } from 'react'
@@ -23,6 +28,39 @@ export interface DefaultLayoutProps {
   hideMobileMenu?: boolean
 }
 
+const MicroUpgradeBannerController = () => {
+  const { ref } = useParams()
+  const { addBanner, dismissBanner } = useBannerStack()
+  const { data: org } = useSelectedOrganizationQuery()
+  const { data: project } = useSelectedProjectQuery()
+  const { data: subscription } = useOrgSubscriptionQuery({ orgSlug: org?.slug })
+
+  const [isBannerDismissed] = useLocalStorageQuery(
+    LOCAL_STORAGE_KEYS.MICRO_UPGRADE_BANNER_DISMISSED(ref ?? ''),
+    false
+  )
+
+  const isProPlan = subscription?.plan.id === 'pro'
+  const isOnNano = project?.infra_compute_size === 'nano'
+  const shouldShow = isProPlan && isOnNano && !isBannerDismissed
+  // const shouldShow = true // Temporarily hide the banner while we work on the upgrade process
+
+  useEffect(() => {
+    if (shouldShow) {
+      addBanner({
+        id: 'micro-upgrade-banner',
+        isDismissed: false,
+        content: <BannerMicroUpgrade />,
+        priority: 5,
+      })
+    } else {
+      dismissBanner('micro-upgrade-banner')
+    }
+  }, [shouldShow, addBanner, dismissBanner])
+
+  return null
+}
+
 /**
  * Base layout for all project pages in the dashboard, rendered as the first child on all page files within a project.
  *
@@ -78,6 +116,7 @@ export const DefaultLayout = ({
         <ProjectContextProvider projectRef={ref}>
           <MobileSheetProvider>
             <BannerStackProvider>
+              <MicroUpgradeBannerController />
               <div className="flex flex-col h-screen w-screen">
                 {/* Top Banner */}
                 <AppBannerWrapper />
diff --git a/apps/studio/components/ui/BannerStack/Banners/BannerMicroUpgrade.tsx b/apps/studio/components/ui/BannerStack/Banners/BannerMicroUpgrade.tsx
new file mode 100644
index 00000000000..a19bbac4c34
--- /dev/null
+++ b/apps/studio/components/ui/BannerStack/Banners/BannerMicroUpgrade.tsx
@@ -0,0 +1,35 @@
+import { useParams } from 'common'
+import { Zap } from 'lucide-react'
+import Link from 'next/link'
+import { Button } from 'ui'
+import { BannerCard } from '../BannerCard'
+import { useBannerStack } from '../BannerStackProvider'
+
+export const BannerMicroUpgrade = () => {
+  const { ref } = useParams()
+  const { dismissBanner } = useBannerStack()
+
+  return (
+    <BannerCard onDismiss={() => dismissBanner('micro-upgrade-banner')}>
+      <div className="flex flex-col gap-y-4">
+        <div className="flex flex-col gap-y-2 items-start">
+          <div className="p-2 rounded-lg bg-brand-300 text-brand">
+            <Zap size={16} />
+          </div>
+        </div>
+        <div className="flex flex-col gap-y-1 mb-2">
+          <p className="text-sm font-medium">Free Micro compute upgrade available</p>
+          <p className="text-xs text-foreground-lighter text-balance">
+            Your Pro plan includes a free upgrade from Nano to Micro compute — double the memory at
+            no extra cost.
+          </p>
+        </div>
+        <div className="flex gap-2">
+          <Button asChild type="primary" size="tiny">
+            <Link href={`/project/${ref}/settings/compute-and-disk`}>Upgrade now</Link>
+          </Button>
+        </div>
+      </div>
+    </BannerCard>
+  )
+}
diff --git a/apps/studio/tailwind.config.js b/apps/studio/tailwind.config.js
index b5fdcf67abc..2e508476a34 100644
--- a/apps/studio/tailwind.config.js
+++ b/apps/studio/tailwind.config.js
@@ -80,9 +80,14 @@ module.exports = config({
 
       animation: {
         shimmer: 'shimmer 2s infinite linear',
+        float: 'float 3s ease-in-out infinite',
         sway: 'sway 3s cubic-bezier(0.4, 0, 0.6, 1) infinite',
       },
       keyframes: {
+        float: {
+          '0%, 100%': { transform: 'translateY(0px)' },
+          '50%': { transform: 'translateY(-6px)' },
+        },
         shimmer: {
           '0%': {
             'background-position': '-1000px 0',
diff --git a/packages/common/constants/local-storage.ts b/packages/common/constants/local-storage.ts
index 2731360655a..b6f63b32ee4 100644
--- a/packages/common/constants/local-storage.ts
+++ b/packages/common/constants/local-storage.ts
@@ -100,6 +100,9 @@ export const LOCAL_STORAGE_KEYS = {
   // Index Advisor notice dismissed
   INDEX_ADVISOR_NOTICE_DISMISSED: (ref: string) => `index-advisor-notice-dismissed-${ref}`,
 
+  // Micro upgrade banner dismissed
+  MICRO_UPGRADE_BANNER_DISMISSED: (ref: string) => `micro-upgrade-banner-dismissed-${ref}`,
+
   // RLS event trigger banner dismissed
   RLS_EVENT_TRIGGER_BANNER_DISMISSED: (ref: string) => `rls-event-trigger-banner-dismissed-${ref}`,