diff --git a/packages/isomorphic/stackTrace.ts b/packages/isomorphic/stackTrace.ts
index dca83848e9414..97447e425b4a4 100644
--- a/packages/isomorphic/stackTrace.ts
+++ b/packages/isomorphic/stackTrace.ts
@@ -30,9 +30,10 @@ export type StackFrame = {
 
 export function captureRawStack(): RawStack {
   const stackTraceLimit = Error.stackTraceLimit;
-  Error.stackTraceLimit = 50;
-  const error = new Error();
-  const stack = error.stack || '';
+  Error.stackTraceLimit = 200;
+  const obj: { stack?: string } = {};
+  Error.captureStackTrace(obj);
+  const stack = obj.stack || '';
   Error.stackTraceLimit = stackTraceLimit;
   return stack.split('\n');
 }
@@ -107,11 +108,17 @@ export function parseStackFrame(text: string, pathSeparator: string, showInterna
 }
 
 export function rewriteErrorMessage<E extends Error>(e: E, newMessage: string): E {
-  const lines: string[] = (e.stack?.split('\n') || []).filter(l => l.startsWith('    at '));
+  const originalStack = e.stack || '';
+
   e.message = newMessage;
+
   const errorTitle = `${e.name}: ${e.message}`;
-  if (lines.length)
-    e.stack = `${errorTitle}\n${lines.join('\n')}`;
+
+  if (originalStack) {
+    const stackWithoutTitle = originalStack.split('\n').slice(1).join('\n');
+    e.stack = `${errorTitle}\n${stackWithoutTitle}`;
+  }
+
   return e;
 }
 
@@ -150,10 +157,16 @@ export function parseErrorStack(stack: string, pathSeparator: string, showIntern
     const frame = parseStackFrame(line, pathSeparator, showInternalStackFrames);
     if (!frame || !frame.file)
       continue;
-    if (belongsToNodeModules(frame.file, pathSeparator))
-      continue;
-    location = { file: frame.file, column: frame.column || 0, line: frame.line || 0 };
-    break;
+    // Prefer non-node_modules frames
+    if (!belongsToNodeModules(frame.file, pathSeparator)) {
+      location = { file: frame.file, column: frame.column || 0, line: frame.line || 0 };
+      break;
+    }
+
+    // fallback if only node_modules found
+    if (!location) {
+      location = { file: frame.file, column: frame.column || 0, line: frame.line || 0 };
+    }
   }
   return { message, stackLines, location };
 }
diff --git a/packages/playwright/src/worker/testInfo.ts b/packages/playwright/src/worker/testInfo.ts
index 9d6bb0e087dd5..e52a5fb1db5b2 100644
--- a/packages/playwright/src/worker/testInfo.ts
+++ b/packages/playwright/src/worker/testInfo.ts
@@ -322,8 +322,6 @@ export class TestInfoImpl implements TestInfo {
           if (typeof result.error === 'object' && !(result.error as any)?.[stepSymbol])
             (result.error as any)[stepSymbol] = step;
           const error = testInfoError(result.error);
-          if (step.boxedStack)
-            error.stack = `${error.message}\n${stringifyStackFrames(step.boxedStack).join('\n')}`;
           step.error = error;
         }
 
@@ -410,8 +408,13 @@ export class TestInfoImpl implements TestInfo {
       this.status = error instanceof TimeoutManagerError ? 'timedOut' : 'failed';
     const serialized = testInfoError(error);
     const step: TestStepInternal | undefined = typeof error === 'object' ? (error as any)?.[stepSymbol] : undefined;
-    if (step && step.boxedStack)
-      serialized.stack = `${(error as Error).name}: ${(error as Error).message}\n${stringifyStackFrames(step.boxedStack).join('\n')}`;
+
+    if (step && step.boxedStack) {
+      const originalStack = (error as Error).stack || `${(error as Error).name}: ${(error as Error).message}`;
+      const stepStack = stringifyStackFrames(step.boxedStack).join('\n');
+
+      serialized.stack = `${originalStack}\n--- STEP ---\n${stepStack}`;
+    }
     this.errors.push(serialized);
     this._tracing.appendForError(serialized);
   }