diff --git a/gui-js/libs/shared/src/lib/backend/minsky.ts b/gui-js/libs/shared/src/lib/backend/minsky.ts
index bb4abf247..11da11a7d 100644
--- a/gui-js/libs/shared/src/lib/backend/minsky.ts
+++ b/gui-js/libs/shared/src/lib/backend/minsky.ts
@@ -1107,6 +1107,7 @@ export class Group extends Item {
   async portY(a1: number): Promise<number> {return this.$callMethod('portY',a1);}
   async ports(a1: number): Promise<object> {return this.$callMethod('ports',a1);}
   async portsSize(): Promise<number> {return this.$callMethod('portsSize');}
+  async positionEdgeVariables(): Promise<void> {return this.$callMethod('positionEdgeVariables');}
   async px(...args: number[]): Promise<number> {return this.$callMethod('px',...args);}
   async py(...args: number[]): Promise<number> {return this.$callMethod('py',...args);}
   async pz(...args: number[]): Promise<number> {return this.$callMethod('pz',...args);}
@@ -2030,6 +2031,7 @@ export class Selection extends CppClass {
   async portY(a1: number): Promise<number> {return this.$callMethod('portY',a1);}
   async ports(a1: number): Promise<object> {return this.$callMethod('ports',a1);}
   async portsSize(): Promise<number> {return this.$callMethod('portsSize');}
+  async positionEdgeVariables(): Promise<void> {return this.$callMethod('positionEdgeVariables');}
   async randomLayout(): Promise<void> {return this.$callMethod('randomLayout');}
   async relZoom(...args: number[]): Promise<number> {return this.$callMethod('relZoom',...args);}
   async removeDisplayPlot(): Promise<void> {return this.$callMethod('removeDisplayPlot');}
diff --git a/model/canvas.cc b/model/canvas.cc
index 75daea5d0..37400788e 100644
--- a/model/canvas.cc
+++ b/model/canvas.cc
@@ -426,9 +426,24 @@ namespace minsky
                           return false;  
                        });
     if (!item)
-      item=model->findAny
-        (&Group::groups, [&](const GroupPtr& i)
-                         {return i->visible() && i->clickType(x,y)!=ClickType::outside;});
+      {
+        // Check if clicking on a group's edge I/O variable
+        model->recursiveDo(&Group::groups,
+                           [&](Groups&, Groups::const_iterator i)
+                           {
+                             if ((*i)->visible())
+                               if (auto selected=(*i)->select(x,y))
+                                 {
+                                   item=selected;
+                                   return true;
+                                 }
+                             return false;
+                           });
+        if (!item)
+          item=model->findAny
+            (&Group::groups, [&](const GroupPtr& i)
+                             {return i->visible() && i->clickType(x,y)!=ClickType::outside;});
+      }
     return item;
   }
   
diff --git a/model/group.cc b/model/group.cc
index 5dbf77cda..8c5bd2764 100644
--- a/model/group.cc
+++ b/model/group.cc
@@ -33,6 +33,8 @@
 using namespace std;
 using namespace ecolab::cairo;
 
+#include <algorithm>
+
 // size of the top and bottom margins of the group icon
 static const int topMargin=10;
 
@@ -912,10 +914,10 @@ namespace minsky
     auto z=zoomFactor();
     const double w=0.5*iWidth()*z, h=0.5*iHeight()*z;
     if (onResizeHandle(x,y)) return ClickType::onResize;         
-    if (displayContents() && inIORegion(x,y)==IORegion::none)
-      return ClickType::outside;
     if (auto item=select(x,y))
       return item->clickType(x,y);
+    if (displayContents() && inIORegion(x,y)==IORegion::none)
+      return ClickType::outside;
     if ((abs(x-this->x())<w && abs(y-this->y())<h+topMargin*z)) // check also if (x,y) is within top and bottom margins of group. for feature 88
       return ClickType::onItem;
     return ClickType::outside;
@@ -1180,14 +1182,72 @@ namespace minsky
     return rotFactor;
   }
 
+  void Group::positionEdgeVariables() const
+  {
+    // Position edge variables at their correct edge locations
+    // This is needed for hit testing since ports are positioned relative to variables
+    float left, right;
+    margins(left, right);
+    const float z = zoomFactor();
+    const Rotate r(rotation(), 0, 0);
+    
+    auto positionEdge = [&](const vector<VariablePtr>& vars, float edgeX) {
+      float top = 0, bottom = 0;
+      for (size_t i = 0; i < vars.size(); ++i)
+        {
+          auto& v = vars[i];
+          float edgeY = 0;
+          auto vz = v->zoomFactor();
+          auto t = v->bb.top() * vz, b = v->bb.bottom() * vz;
+          if (i > 0) edgeY = i % 2 ? top - b : bottom - t;
+          
+          // Move variable to edge position (same as in draw1edge)
+          v->moveTo(r.x(edgeX, edgeY) + this->x(), r.y(edgeX, edgeY) + this->y());
+          v->rotation(rotation());
+          
+          // Also position ports (simplified version of what happens in Variable::draw)
+          // This ensures port hit testing works correctly
+          const RenderVariable rv(*v);
+          const double w = std::max(rv.width(), 0.5f * v->iWidth());
+          const double angle = v->rotation() * M_PI / 180.0;
+          const double sa = sin(angle), ca = cos(angle);
+          const double x0 = vz * w, y0 = 0, x1 = -vz * w + 2, y1 = 0;
+          if (v->portsSize() > 0)
+            v->ports(0).lock()->moveTo(v->x() + (x0 * ca - y0 * sa), v->y() + (y0 * ca + x0 * sa));
+          if (v->portsSize() > 1)
+            v->ports(1).lock()->moveTo(v->x() + (x1 * ca - y1 * sa), v->y() + (y1 * ca + x1 * sa));
+          
+          if (i == 0)
+            {
+              bottom = b;
+              top = t;
+            }
+          else if (i % 2)
+            top -= (b - t);
+          else
+            bottom += (b - t);
+        }
+    };
+    
+    positionEdge(inVariables, -0.5 * (iWidth() * z - left));
+    positionEdge(outVariables, 0.5 * (iWidth() * z - right));
+  }
+
   ItemPtr Group::select(float x, float y) const
   {
+    // Position edge variables at their correct locations for accurate hit testing
+    positionEdgeVariables();
+    
+    // Check input variables
     for (auto& v: inVariables)
       if (RenderVariable(*v).inImage(x,y)) 
         return v;
+    
+    // Check output variables
     for (auto& v: outVariables)
       if (RenderVariable(*v).inImage(x,y)) 
         return v;
+    
     return nullptr;
   }
 
diff --git a/model/group.h b/model/group.h
index d339efe3b..91511fb8d 100644
--- a/model/group.h
+++ b/model/group.h
@@ -372,6 +372,8 @@ namespace minsky
 
     /// scaling factor to allow a rotated icon to fit on the bitmap
     float rotFactor() const;
+    
+    void positionEdgeVariables() const;
 
     /// returns the variable if point (x,y) is within a
     /// I/O variable icon, null otherwise, indicating that the Group
diff --git a/package-lock.json b/package-lock.json
index 283967596..a3ea4db8a 100644
--- a/package-lock.json
+++ b/package-lock.json
@@ -92,6 +92,7 @@
       "integrity": "sha512-ENHwaH+JIRTDIEEbDK6QSQntAYGtbvdDXnMXnZaZ6k13Du1dPMmprkEHIL7ok2Wl2aZevetwTAb5S+7yIF+enA==",
       "dev": true,
       "license": "MIT",
+      "peer": true,
       "dependencies": {
         "undici-types": "~7.8.0"
       }
@@ -227,6 +228,7 @@
       "resolved": "https://registry.npmjs.org/typescript/-/typescript-5.8.3.tgz",
       "integrity": "sha512-p1diW6TqL9L07nNxvRMM7hMMw4c5XOo/1ibL4aAIGmSAt9slTE1Xgw5KWuof2uTOvCg9BY7ZRi+GaF+7sfgPeQ==",
       "license": "Apache-2.0",
+      "peer": true,
       "bin": {
         "tsc": "bin/tsc",
         "tsserver": "bin/tsserver"