diff --git a/osu.Game/Overlays/NotificationOverlayToastTray.cs b/osu.Game/Overlays/NotificationOverlayToastTray.cs
index e4d3864beb..1da05dab75 100644
--- a/osu.Game/Overlays/NotificationOverlayToastTray.cs
+++ b/osu.Game/Overlays/NotificationOverlayToastTray.cs
@@ -78,7 +78,6 @@ namespace osu.Game.Overlays
                 {
                     LayoutDuration = 150,
                     LayoutEasing = Easing.OutQuart,
-                    Spacing = new Vector2(3),
                     RelativeSizeAxes = Axes.X,
                     AutoSizeAxes = Axes.Y,
                 },
diff --git a/osu.Game/Overlays/Notifications/Notification.cs b/osu.Game/Overlays/Notifications/Notification.cs
index f83be0c446..fe2f67973a 100644
--- a/osu.Game/Overlays/Notifications/Notification.cs
+++ b/osu.Game/Overlays/Notifications/Notification.cs
@@ -113,6 +113,9 @@ namespace osu.Game.Overlays.Notifications
                 },
                 dragContainer = new DragContainer(this)
                 {
+                    // Use margin instead of FillFlow spacing to fix extra padding appearing when notification shrinks
+                    // in height.
+                    Padding = new MarginPadding { Vertical = 3f },
                     RelativeSizeAxes = Axes.X,
                     AutoSizeAxes = Axes.Y,
                 }.WithChild(MainContent = new Container
diff --git a/osu.Game/Overlays/Notifications/NotificationSection.cs b/osu.Game/Overlays/Notifications/NotificationSection.cs
index d2e18a0cee..14bacca534 100644
--- a/osu.Game/Overlays/Notifications/NotificationSection.cs
+++ b/osu.Game/Overlays/Notifications/NotificationSection.cs
@@ -106,7 +106,6 @@ namespace osu.Game.Overlays.Notifications
                     RelativeSizeAxes = Axes.X,
                     LayoutDuration = 150,
                     LayoutEasing = Easing.OutQuart,
-                    Spacing = new Vector2(3),
                 }
             });
         }