diff --git a/python/semantic_kernel/template_engine/blocks/code_block.py b/python/semantic_kernel/template_engine/blocks/code_block.py
index 35297feaf39a..c9d311b1ae27 100644
--- a/python/semantic_kernel/template_engine/blocks/code_block.py
+++ b/python/semantic_kernel/template_engine/blocks/code_block.py
@@ -13,6 +13,7 @@
 from semantic_kernel.template_engine.blocks.block_types import BlockTypes
 from semantic_kernel.template_engine.blocks.function_id_block import FunctionIdBlock
 from semantic_kernel.template_engine.blocks.named_arg_block import NamedArgBlock
+from semantic_kernel.template_engine.blocks.var_block import VarBlock
 from semantic_kernel.template_engine.code_tokenizer import CodeTokenizer
 
 if TYPE_CHECKING:
@@ -149,7 +150,14 @@ def _enrich_function_arguments(
             )
         for index, token in enumerate(self.tokens[1:], start=1):
             logger.debug(f"Parsing variable/value: `{self.tokens[1].content}`")
-            rendered_value = token.render(kernel, arguments)  # type: ignore
+            # For NamedArgBlock, render() returns the actual value (not string representation)
+            # For VarBlock used as positional arg, we need to get the actual value too
+            if isinstance(token, VarBlock):
+                # Get the actual value from arguments, not the string representation
+                rendered_value = arguments.get(token.name, "")
+            else:
+                rendered_value = token.render(kernel, arguments)  # type: ignore
+            
             if not isinstance(token, NamedArgBlock) and index == 1:
                 arguments[function_metadata.parameters[0].name] = rendered_value
                 continue
diff --git a/python/semantic_kernel/template_engine/blocks/named_arg_block.py b/python/semantic_kernel/template_engine/blocks/named_arg_block.py
index 80941d120b9f..bf2ec779022f 100644
--- a/python/semantic_kernel/template_engine/blocks/named_arg_block.py
+++ b/python/semantic_kernel/template_engine/blocks/named_arg_block.py
@@ -88,11 +88,20 @@ def parse_content(cls, fields: Any) -> Any:
         return fields
 
     def render(self, kernel: "Kernel", arguments: Optional["KernelArguments"] = None) -> Any:
-        """Render the named argument block."""
+        """Render the named argument block.
+        
+        When rendering a named argument, we return the actual value from the arguments
+        (not the string representation) so that functions receive the correct type.
+        """
         if self.value:
             return self.value.render()
         if arguments is None:
             return ""
         if self.variable:
-            return self.variable.render(kernel, arguments)
+            # Return the actual value from arguments, not the string representation
+            # Check if the variable name exists in arguments
+            if self.variable.name not in arguments:
+                logger.warning(f"Variable `${self.variable.name}` not found in the KernelArguments")
+                return ""
+            return arguments[self.variable.name]
         return None
diff --git a/python/tests/unit/prompt_template/test_non_string_arguments.py b/python/tests/unit/prompt_template/test_non_string_arguments.py
new file mode 100644
index 000000000000..30571a4a2517
--- /dev/null
+++ b/python/tests/unit/prompt_template/test_non_string_arguments.py
@@ -0,0 +1,219 @@
+# Copyright (c) Microsoft. All rights reserved.
+
+"""Tests for non-string kernel arguments passed to functions in prompt templates."""
+
+import pytest
+
+from semantic_kernel import Kernel
+from semantic_kernel.functions import kernel_function
+from semantic_kernel.functions.kernel_arguments import KernelArguments
+from semantic_kernel.prompt_template.kernel_prompt_template import KernelPromptTemplate
+from semantic_kernel.prompt_template.prompt_template_config import PromptTemplateConfig
+
+
+class NonStringArgumentsPlugin:
+    """Plugin to test non-string argument types."""
+
+    @kernel_function
+    def process_int(self, value: int) -> str:
+        """Process an integer argument."""
+        assert isinstance(value, int), f"Expected int, got {type(value)}"
+        return f"int:{value * 2}"
+
+    @kernel_function
+    def process_float(self, value: float) -> str:
+        """Process a float argument."""
+        assert isinstance(value, (float, int)), f"Expected float, got {type(value)}"
+        return f"float:{value * 2.0}"
+
+    @kernel_function
+    def process_bool(self, value: bool) -> str:
+        """Process a boolean argument."""
+        assert isinstance(value, bool), f"Expected bool, got {type(value)}"
+        return f"bool:{not value}"
+
+    @kernel_function
+    def process_list(self, items: list) -> str:
+        """Process a list argument."""
+        assert isinstance(items, list), f"Expected list, got {type(items)}"
+        return f"list:{len(items)}"
+
+    @kernel_function
+    def process_dict(self, data: dict) -> str:
+        """Process a dict argument."""
+        assert isinstance(data, dict), f"Expected dict, got {type(data)}"
+        return f"dict:{len(data)}"
+
+    @kernel_function
+    def process_none(self, value: None) -> str:
+        """Process a None argument."""
+        assert value is None, f"Expected None, got {value}"
+        return "none:received"
+
+    @kernel_function
+    def process_multiple(self, a: int, b: str, c: list) -> str:
+        """Process multiple arguments of different types."""
+        assert isinstance(a, int), f"Expected int for a, got {type(a)}"
+        assert isinstance(b, str), f"Expected str for b, got {type(b)}"
+        assert isinstance(c, list), f"Expected list for c, got {type(c)}"
+        return f"multi:{a},{b},{len(c)}"
+
+
+@pytest.mark.asyncio
+async def test_int_argument(kernel: Kernel):
+    """Test passing integer argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_int value=$num }}"
+    arguments = KernelArguments(num=42)
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: int:84"
+
+
+@pytest.mark.asyncio
+async def test_float_argument(kernel: Kernel):
+    """Test passing float argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_float value=$num }}"
+    arguments = KernelArguments(num=3.14)
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: float:6.28"
+
+
+@pytest.mark.asyncio
+async def test_bool_argument(kernel: Kernel):
+    """Test passing boolean argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_bool value=$flag }}"
+    arguments = KernelArguments(flag=True)
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: bool:False"
+
+
+@pytest.mark.asyncio
+async def test_list_argument(kernel: Kernel):
+    """Test passing list argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_list items=$my_list }}"
+    arguments = KernelArguments(my_list=[1, 2, 3, 4, 5])
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: list:5"
+
+
+@pytest.mark.asyncio
+async def test_dict_argument(kernel: Kernel):
+    """Test passing dict argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_dict data=$my_dict }}"
+    arguments = KernelArguments(my_dict={"a": 1, "b": 2, "c": 3})
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: dict:3"
+
+
+@pytest.mark.asyncio
+async def test_none_argument(kernel: Kernel):
+    """Test passing None argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_none value=$none_val }}"
+    arguments = KernelArguments(none_val=None)
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: none:received"
+
+
+@pytest.mark.asyncio
+async def test_multiple_typed_arguments(kernel: Kernel):
+    """Test passing multiple arguments of different types to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_multiple a=$num b=$text c=$items }}"
+    arguments = KernelArguments(num=10, text="hello", items=[1, 2, 3])
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: multi:10,hello,3"
+
+
+@pytest.mark.asyncio
+async def test_string_argument_still_works(kernel: Kernel):
+    """Test that string arguments still work correctly."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_multiple a=$num b=$text c=$items }}"
+    arguments = KernelArguments(num=5, text="world", items=[])
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: multi:5,world,0"
+
+
+@pytest.mark.asyncio
+async def test_positional_list_argument(kernel: Kernel):
+    """Test passing list as positional (first) argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_list $my_list }}"
+    arguments = KernelArguments(my_list=[1, 2, 3, 4, 5])
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: list:5"
+
+
+@pytest.mark.asyncio
+async def test_positional_int_argument(kernel: Kernel):
+    """Test passing int as positional (first) argument to function."""
+    kernel.add_plugin(NonStringArgumentsPlugin(), "test")
+    template = "Result: {{ test.process_int $num }}"
+    arguments = KernelArguments(num=42)
+
+    result = await KernelPromptTemplate(
+        prompt_template_config=PromptTemplateConfig(
+            name="test", description="test", template=template, allow_dangerously_set_content=True
+        )
+    ).render(kernel, arguments)
+
+    assert result == "Result: int:84"