diff --git a/e2e-tests/cypress/tests/integration/channels/files_and_attachments/youtube_video_spec.js b/e2e-tests/cypress/tests/integration/channels/files_and_attachments/youtube_video_spec.js
index 58aa8eb086..db67be9600 100644
--- a/e2e-tests/cypress/tests/integration/channels/files_and_attachments/youtube_video_spec.js
+++ b/e2e-tests/cypress/tests/integration/channels/files_and_attachments/youtube_video_spec.js
@@ -37,7 +37,7 @@ describe('YouTube Video', () => {
             cy.get('.play-button', {timeout: TIMEOUTS.TEN_SEC}).click();
 
             // * Video should be loaded in the iframe
-            cy.get('.video-div > iframe').should('exist');
+            cy.get('.video-playing iframe').should('exist');
 
             // # Collapse video
             cy.get('.post__embed-visibility').click();
@@ -52,7 +52,7 @@ describe('YouTube Video', () => {
             cy.get('.play-button').should('exist');
 
             // * Video should not be played in the iframe
-            cy.get('.video-div > iframe').should('not.exist');
+            cy.get('.video-playing iframe').should('not.exist');
         });
     });
 });
diff --git a/webapp/channels/src/components/youtube_video/__snapshots__/youtube_video.test.tsx.snap b/webapp/channels/src/components/youtube_video/__snapshots__/youtube_video.test.tsx.snap
index 4e5f490148..6f62daa7ae 100644
--- a/webapp/channels/src/components/youtube_video/__snapshots__/youtube_video.test.tsx.snap
+++ b/webapp/channels/src/components/youtube_video/__snapshots__/youtube_video.test.tsx.snap
@@ -63,41 +63,51 @@ exports[`YoutubeVideo should match init snapshot 1`] = `
         </h4>
         <div
           className="video-div embed-responsive-item"
-          onClick={[Function]}
         >
-          <div
-            className="embed-responsive video-div__placeholder"
+          <YouTubeThumbnail
+            onError={[Function]}
+            play={[Function]}
+            thumbnailUrl="https://img.youtube.com/vi/xqCoNej8Zxo/maxresdefault.jpg"
+            useMaxResThumbnail={true}
+            videoTitle="Youtube title"
           >
             <div
+              aria-label="Play Youtube title on YouTube"
               className="video-thumbnail__container"
+              onClick={[Function]}
+              onKeyDown={[Function]}
+              role="button"
+              tabIndex={0}
             >
               <Connect(Component)
-                src="linkForThumbnail"
+                src="https://img.youtube.com/vi/xqCoNej8Zxo/maxresdefault.jpg"
               >
                 <Memo(ExternalImage)
                   dispatch={[Function]}
                   enableSVGs={false}
                   hasImageProxy={false}
-                  src="linkForThumbnail"
+                  src="https://img.youtube.com/vi/xqCoNej8Zxo/maxresdefault.jpg"
                 >
                   <img
-                    alt="youtube video thumbnail"
+                    alt="Thumbnail for Youtube title on YouTube"
                     className="video-thumbnail"
-                    src="linkForThumbnail"
+                    onError={[Function]}
+                    src="https://img.youtube.com/vi/xqCoNej8Zxo/maxresdefault.jpg"
                   />
                 </Memo(ExternalImage)>
               </Connect(Component)>
               <div
-                className="block"
+                aria-label="Play video"
+                className="play-button"
+                role="presentation"
               >
-                <span
-                  className="play-button"
-                >
-                  <span />
-                </span>
+                <i
+                  aria-hidden="true"
+                  className="icon-play"
+                />
               </div>
             </div>
-          </div>
+          </YouTubeThumbnail>
         </div>
       </div>
     </div>
@@ -129,19 +139,21 @@ exports[`YoutubeVideo should match snapshot for playing state 1`] = `
     </h4>
     <div
       className="video-div embed-responsive-item"
-      onClick={[Function]}
     >
-      <iframe
-        allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share"
-        allowFullScreen={true}
-        frameBorder="0"
-        height="360px"
-        referrerPolicy="no-referrer"
-        sandbox="allow-scripts allow-same-origin allow-popups allow-presentation"
-        src="https://www.youtube.com/embed/xqCoNej8Zxo?autoplay=1&autohide=1&border=0&wmode=opaque&fs=1&enablejsapi=1"
-        title="Youtube title"
-        width="480px"
-      />
+      <div
+        className="video-playing"
+      >
+        <iframe
+          allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture"
+          allowFullScreen={true}
+          frameBorder="0"
+          height="100%"
+          sandbox="allow-scripts allow-same-origin allow-popups allow-presentation"
+          src="https://www.youtube.com/embed/xqCoNej8Zxo?autoplay=1&rel=0&fs=1&enablejsapi=1"
+          title="Youtube title"
+          width="100%"
+        />
+      </div>
     </div>
   </div>
 </div>
@@ -171,19 +183,22 @@ exports[`YoutubeVideo should match snapshot for playing state and \`youtubeRefer
     </h4>
     <div
       className="video-div embed-responsive-item"
-      onClick={[Function]}
     >
-      <iframe
-        allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share"
-        allowFullScreen={true}
-        frameBorder="0"
-        height="360px"
-        referrerPolicy="strict-origin-when-cross-origin"
-        sandbox="allow-scripts allow-same-origin allow-popups allow-presentation"
-        src="https://www.youtube.com/embed/xqCoNej8Zxo?autoplay=1&autohide=1&border=0&wmode=opaque&fs=1&enablejsapi=1"
-        title="Youtube title"
-        width="480px"
-      />
+      <div
+        className="video-playing"
+      >
+        <iframe
+          allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture"
+          allowFullScreen={true}
+          frameBorder="0"
+          height="100%"
+          referrerPolicy="origin"
+          sandbox="allow-scripts allow-same-origin allow-popups allow-presentation"
+          src="https://www.youtube.com/embed/xqCoNej8Zxo?autoplay=1&rel=0&fs=1&enablejsapi=1"
+          title="Youtube title"
+          width="100%"
+        />
+      </div>
     </div>
   </div>
 </div>
diff --git a/webapp/channels/src/components/youtube_video/youtube_video.test.tsx b/webapp/channels/src/components/youtube_video/youtube_video.test.tsx
index fa63f498bb..f9ad2c793a 100644
--- a/webapp/channels/src/components/youtube_video/youtube_video.test.tsx
+++ b/webapp/channels/src/components/youtube_video/youtube_video.test.tsx
@@ -7,8 +7,6 @@ import {Provider} from 'react-redux';
 
 import type {DeepPartial} from '@mattermost/types/utilities';
 
-import ExternalImage from 'components/external_image';
-
 import mockStore from 'tests/test_store';
 
 import type {GlobalState} from 'types/store';
@@ -56,8 +54,10 @@ describe('YoutubeVideo', () => {
             </Provider>,
         );
         expect(wrapper).toMatchSnapshot();
-        expect(wrapper.find(ExternalImage).prop('src')).toEqual('linkForThumbnail');
-        expect(wrapper.find('a').text()).toEqual('Youtube title');
+
+        // Verify that useMaxResThumbnail is true by default
+        expect((wrapper.find('YoutubeVideo').instance() as YoutubeVideo).state.useMaxResThumbnail).toBe(true);
+        expect(wrapper.find('h4').text()).toEqual('YouTube - Youtube title');
     });
 
     test('should match snapshot for playing state', () => {
@@ -75,6 +75,12 @@ describe('YoutubeVideo', () => {
         );
         wrapper.setState({playing: true});
         expect(wrapper).toMatchSnapshot();
+
+        // Verify that the iframe has a referrerPolicy attribute (set to 'origin') when youtubeReferrerPolicy is true.
+        expect(wrapper.find('.video-playing iframe').prop('referrerPolicy')).toEqual('origin');
+
+        // Verify that the iframe src includes the new parameters
+        expect(wrapper.find('.video-playing iframe').prop('src')).toEqual('https://www.youtube.com/embed/xqCoNej8Zxo?autoplay=1&rel=0&fs=1&enablejsapi=1');
     });
 
     test('should use url if secure_url is not present', () => {
@@ -89,6 +95,26 @@ describe('YoutubeVideo', () => {
         };
         const wrapper = shallow(<YoutubeVideo {...props}/>);
 
-        expect(wrapper.find(ExternalImage).prop('src')).toEqual('linkUrl');
+        // Verify that useMaxResThumbnail is true by default
+        expect(wrapper.state('useMaxResThumbnail')).toBe(true);
+    });
+
+    describe('thumbnail fallback', () => {
+        it('should fallback to hqdefault.jpg on image error', () => {
+            const wrapper = shallow(<YoutubeVideo {...baseProps}/>);
+
+            // Simulate an image error by calling handleImageError.
+            (wrapper.instance() as YoutubeVideo).handleImageError();
+
+            // Verify that useMaxResThumbnail is now false (will use hqdefault.jpg).
+            expect(wrapper.state('useMaxResThumbnail')).toBe(false);
+        });
+    });
+
+    it('should initialize with useMaxResThumbnail set to true', () => {
+        const wrapper = shallow(<YoutubeVideo {...baseProps}/>);
+
+        // Verify that the component initializes with useMaxResThumbnail = true
+        expect(wrapper.state('useMaxResThumbnail')).toBe(true);
     });
 });
diff --git a/webapp/channels/src/components/youtube_video/youtube_video.tsx b/webapp/channels/src/components/youtube_video/youtube_video.tsx
index cfc9176adc..686c0d59cd 100644
--- a/webapp/channels/src/components/youtube_video/youtube_video.tsx
+++ b/webapp/channels/src/components/youtube_video/youtube_video.tsx
@@ -2,6 +2,7 @@
 // See LICENSE.txt for license information.
 
 import React from 'react';
+import {useIntl} from 'react-intl';
 
 import type {OpenGraphMetadata} from '@mattermost/types/posts';
 
@@ -20,24 +21,113 @@ type Props = {
 
 type State = {
     playing: boolean;
+    useMaxResThumbnail: boolean;
+    prevLink: string;
+}
+
+type YouTubeThumbnailProps = {
+    play: () => void;
+    videoTitle: string;
+    onError: () => void;
+    thumbnailUrl: string;
+    useMaxResThumbnail: boolean;
+};
+
+function YouTubeThumbnail({play, videoTitle, onError, thumbnailUrl}: YouTubeThumbnailProps) {
+    const {formatMessage} = useIntl();
+
+    return (
+        <div
+            className='video-thumbnail__container'
+            onClick={play}
+            role='button'
+            aria-label={formatMessage({
+                id: 'youtube_video.play.aria_label',
+                defaultMessage: 'Play {videoTitle} on YouTube',
+            }, {
+                videoTitle,
+            })}
+            tabIndex={0}
+            onKeyDown={(e) => {
+                if (e.key === 'Enter' || e.key === ' ') {
+                    e.preventDefault();
+                    play();
+                }
+            }}
+        >
+            <ExternalImage src={thumbnailUrl}>
+                {(src) => (
+                    <img
+                        className='video-thumbnail'
+                        src={src}
+                        alt={formatMessage({
+                            id: 'youtube_video.thumbnail.alt_text',
+                            defaultMessage: 'Thumbnail for {videoTitle} on YouTube',
+                        }, {
+                            videoTitle,
+                        })}
+                        onError={onError}
+                    />
+                )}
+            </ExternalImage>
+            <div
+                className='play-button'
+                role='presentation'
+                aria-label={formatMessage({
+                    id: 'youtube_video.play_button.aria_label',
+                    defaultMessage: 'Play video',
+                })}
+            >
+                <i
+                    className='icon-play'
+                    aria-hidden='true'
+                />
+            </div>
+        </div>
+    );
 }
 
 export default class YoutubeVideo extends React.PureComponent<Props, State> {
     constructor(props: Props) {
         super(props);
-
         this.state = {
             playing: false,
+            useMaxResThumbnail: true,
+            prevLink: props.link,
         };
     }
 
-    static getDerivedStateFromProps(props: Props, state: State): State | null {
+    static getDerivedStateFromProps(props: Props, state: State): Partial<State> | null {
+        const nextState: Partial<State> = {};
+
         if (!props.show && state.playing) {
-            return {playing: false};
+            nextState.playing = false;
         }
-        return null;
+
+        if (props.link !== state.prevLink) {
+            nextState.useMaxResThumbnail = true;
+            nextState.prevLink = props.link;
+        }
+
+        return Object.keys(nextState).length > 0 ? nextState : null;
     }
 
+    getMaxResUrl(link: string) {
+        const videoId = getVideoId(link);
+        return `https://img.youtube.com/vi/${videoId}/maxresdefault.jpg`;
+    }
+
+    getHQUrl(link: string) {
+        const videoId = getVideoId(link);
+        return `https://img.youtube.com/vi/${videoId}/hqdefault.jpg`;
+    }
+
+    handleImageError = () => {
+        this.setState({
+            useMaxResThumbnail: false,
+        });
+    };
+
     play = () => {
         this.setState({playing: true});
     };
@@ -48,11 +138,12 @@ export default class YoutubeVideo extends React.PureComponent<Props, State> {
 
     render() {
         const {metadata, link} = this.props;
-
         const videoId = getVideoId(link);
         const videoTitle = metadata?.title || 'unknown';
         const time = handleYoutubeTime(link);
 
+        const thumbnailUrl = this.state.useMaxResThumbnail ? this.getMaxResUrl(link) : this.getHQUrl(link);
+
         const header = (
             <h4>
                 <span className='video-type'>{'YouTube - '}</span>
@@ -71,51 +162,37 @@ export default class YoutubeVideo extends React.PureComponent<Props, State> {
 
         if (this.state.playing) {
             content = (
-                <iframe
-                    src={'https://www.youtube.com/embed/' + videoId + '?autoplay=1&autohide=1&border=0&wmode=opaque&fs=1&enablejsapi=1' + time}
-                    width='480px'
-                    height='360px'
-                    frameBorder='0'
-                    allowFullScreen={true}
-                    allow='accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share'
-                    referrerPolicy={this.props.youtubeReferrerPolicy ? 'strict-origin-when-cross-origin' : 'no-referrer'}
-                    title={videoTitle}
-                    sandbox='allow-scripts allow-same-origin allow-popups allow-presentation'
-                />
+                <div className='video-playing'>
+                    <iframe
+                        src={`https://www.youtube.com/embed/${videoId}?autoplay=1&rel=0&fs=1&enablejsapi=1${time}`}
+                        title={videoTitle}
+                        width='100%'
+                        height='100%'
+                        frameBorder='0'
+                        allow='accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture'
+                        allowFullScreen={true}
+                        referrerPolicy={this.props.youtubeReferrerPolicy ? 'origin' : undefined}
+                        sandbox='allow-scripts allow-same-origin allow-popups allow-presentation'
+                    />
+                </div>
             );
         } else {
-            const image = metadata?.images[0];
-
             content = (
-                <div className='embed-responsive video-div__placeholder'>
-                    <div className='video-thumbnail__container'>
-                        <ExternalImage src={image?.secure_url || image?.url || ''}>
-                            {(safeUrl) => (
-                                <img
-                                    src={safeUrl}
-                                    alt='youtube video thumbnail'
-                                    className='video-thumbnail'
-                                />
-                            )}
-                        </ExternalImage>
-                        <div className='block'>
-                            <span className='play-button'><span/></span>
-                        </div>
-                    </div>
-                </div>
+                <YouTubeThumbnail
+                    play={this.play}
+                    videoTitle={videoTitle}
+                    onError={this.handleImageError}
+                    thumbnailUrl={thumbnailUrl}
+                    useMaxResThumbnail={this.state.useMaxResThumbnail}
+                />
             );
         }
 
         return (
-            <div
-                className='post__embed-container'
-            >
+            <div className='post__embed-container'>
                 <div>
                     {header}
-                    <div
-                        className='video-div embed-responsive-item'
-                        onClick={this.play}
-                    >
+                    <div className='video-div embed-responsive-item'>
                         {content}
                     </div>
                 </div>
@@ -123,7 +200,7 @@ export default class YoutubeVideo extends React.PureComponent<Props, State> {
         );
     }
 
-    public static isYoutubeLink(link: string): boolean {
+    static isYoutubeLink(link: string): boolean {
         return Boolean(link.trim().match(ytRegex));
     }
 }
diff --git a/webapp/channels/src/i18n/en.json b/webapp/channels/src/i18n/en.json
index f2f79a0184..3f68dc3e78 100644
--- a/webapp/channels/src/i18n/en.json
+++ b/webapp/channels/src/i18n/en.json
@@ -6449,5 +6449,8 @@
   "workspace_limits.teams_limit_reached.view_upgrade_options": "View upgrade options",
   "workspace_limits.upgrade": "Upgrade to avoid {planName} data limits",
   "workspace_limits.upgrade_reasons.free": "{planName} is restricted to {messagesLimit} message history and {storageLimit} file storage. You can delete items to free up space or upgrade to a paid plan.",
-  "yourcomputer": "Your computer"
+  "yourcomputer": "Your computer",
+  "youtube_video.play_button.aria_label": "Play video",
+  "youtube_video.play.aria_label": "Play {videoTitle} on YouTube",
+  "youtube_video.thumbnail.alt_text": "Thumbnail for {videoTitle} on YouTube"
 }
diff --git a/webapp/channels/src/sass/components/_videos.scss b/webapp/channels/src/sass/components/_videos.scss
index 64a299784d..7e6ecb1b1e 100644
--- a/webapp/channels/src/sass/components/_videos.scss
+++ b/webapp/channels/src/sass/components/_videos.scss
@@ -1,44 +1,117 @@
 @use "utils/functions";
 @use "utils/variables";
+@use "utils/mixins";
 
 .post {
+    // Container for both video and thumbnail
     .video-div {
         position: relative;
-        overflow: hidden;
+        overflow: hidden; // Ensure hover effects stay contained
+        width: 100%;
         max-width: 480px;
-        height: 360px;
-        border-radius: 4px;
+        max-height: 270px;
         margin-bottom: 8px;
 
-        iframe,
-        video {
-            display: block;
-            max-width: 100%;
-        }
-
-        .video-thumbnail {
-            max-width: 100%;
-            height: auto;
-            cursor: pointer;
-        }
-
-        .block {
+        iframe {
             position: absolute;
-            top: 50%;
-            left: 50%;
-            width: 200px;
-            height: 150px;
-            border-radius: 10px;
-            margin: -75px 0 0 -100px;
-            background-color: functions.alpha-color(variables.$black, 0.5);
+            top: 0;
+            left: 0;
+            display: block;
+            overflow: hidden;
+            width: 100%;
+            height: 100%;
+            border: none;
+            border-radius: var(--radius-s);
+            aspect-ratio: 16/9; // Always use 16:9
+            background-color: #000;
+        }
+
+        // Container for thumbnails
+        .video-thumbnail__container {
+            position: relative;
+            overflow: hidden;
+            width: 100%;
+            border-radius: var(--radius-s);
+            aspect-ratio: 16/9; // Always use 16:9
+            background-color: #000;
+            outline: none; // Remove default focus outline
+
+            // Use existing button focus mixin
+            @include mixins.button-focus;
+
+            // Darkening overlay on hover
+            &::after {
+                position: absolute;
+                top: 0;
+                left: 0;
+                width: 100%;
+                height: 100%;
+                background-color: rgba(0, 0, 0, 0);
+                content: '';
+                pointer-events: none;
+                transition: background-color 0.2s ease;
+            }
+
+            &:hover,
+            &:focus-visible {
+                &::after {
+                    background-color: rgba(0, 0, 0, 0.16);
+                }
+
+                .play-button {
+                    background-color: #FF0033; //youtube red
+                    transform: scale(1.08);
+                }
+            }
+        }
+
+        // Playing state container
+        .video-playing {
+            position: relative;
+            overflow: hidden;
+            width: 100%;
+            aspect-ratio: 16/9; // Always use 16:9
+        }
+
+        // Thumbnail image
+        .video-thumbnail {
+            width: 100%;
+            height: 100%;
+            cursor: pointer;
+            object-fit: cover;
+        }
+
+        // Play button container
+        .play-button {
+            position: absolute;
+            top: calc(50% - 28px);
+            left: calc(50% - 40px);
+            display: flex;
+            width: 80px;
+            height: 56px;
+            align-items: center;
+            justify-content: center;      
+            border-radius: var(--radius-m);
+            background-color: rgba(0, 0, 0, 0.9);
+            cursor: pointer;
+            transition: background-color 0.2s ease, transform 0.2s ease;
+
+            i.icon-play {
+                position: relative;
+                top: -1px;
+                left: -1px;
+                color: #fff;
+                font-size: 48px;
+                line-height: 1;
+            }
         }
     }
 
+    // Video title and type
     .video-type {
         padding: 0;
         margin: 0;
-        font-size: 15px;
-        opacity: 0.8;
+        font-size: 14px;
     }
 
     .video-title {
@@ -46,28 +119,6 @@
         font-size: 15px;
     }
 
-    .play-button {
-        position: absolute;
-        top: 26px;
-        right: 51px;
-        width: 100px;
-        height: 100px;
-        border: 4px solid functions.alpha-color(variables.$white, 0.4);
-        border-radius: 14px;
-        cursor: pointer;
-
-        span {
-            position: absolute;
-            top: 10px;
-            left: 20px;
-            width: 0;
-            height: 0;
-            border-top: 36px solid transparent;
-            border-bottom: 36px solid transparent;
-            border-left: 60px solid functions.alpha-color(variables.$white, 0.4);
-        }
-    }
-
     .img-div {
         position: relative;
         max-width: 480px;
@@ -93,11 +144,4 @@
     .video-loading {
         height: 368px;
     }
-
-    .video-div__placeholder {
-        display: flex;
-        height: 360px;
-        align-items: center;
-        background-color: black;
-    }
 }