diff --git a/apps/studio/components/interfaces/Auth/Policies/AIPolicyEditorPanel/RLSCodeEditor.tsx b/apps/studio/components/interfaces/Auth/Policies/AIPolicyEditorPanel/RLSCodeEditor.tsx
index 6b33be84e2c..babff3766a2 100644
--- a/apps/studio/components/interfaces/Auth/Policies/AIPolicyEditorPanel/RLSCodeEditor.tsx
+++ b/apps/studio/components/interfaces/Auth/Policies/AIPolicyEditorPanel/RLSCodeEditor.tsx
@@ -185,7 +185,10 @@ const RLSCodeEditor = ({
       {placeholder !== undefined && (
         <div
           id={placeholderId}
-          className="monaco-placeholder absolute top-[0px] left-[57px] text-sm pointer-events-none font-mono [&>div>p]:text-foreground-lighter [&>div>p]:!m-0 tracking-tighter"
+          className={cn(
+            'monaco-placeholder absolute top-[0px] left-[57px] text-sm pointer-events-none font-mono tracking-tighter',
+            '[&>div>p]:text-foreground-lighter [&>div>p]:!m-0'
+          )}
           style={{ display: 'none' }}
         >
           <Markdown content={placeholder} />
diff --git a/apps/studio/components/interfaces/Database/Functions/CreateFunction/FunctionEditor.tsx b/apps/studio/components/interfaces/Database/Functions/CreateFunction/FunctionEditor.tsx
index 8742807280e..37db03c783e 100644
--- a/apps/studio/components/interfaces/Database/Functions/CreateFunction/FunctionEditor.tsx
+++ b/apps/studio/components/interfaces/Database/Functions/CreateFunction/FunctionEditor.tsx
@@ -9,26 +9,31 @@ import {
   Tooltip_Shadcn_,
   cn,
 } from 'ui'
+import CodeEditor from 'components/ui/CodeEditor/CodeEditor'
 
 export const FunctionEditor = ({
   field,
+  language,
   focused,
   setFocused,
 }: {
   field: any
+  language: string
   focused: boolean
   setFocused: (b: boolean) => void
 }) => {
   return (
     <div className={cn('rounded-md relative group flex-grow')}>
       <FormControl_Shadcn_>
-        <SqlEditor
-          defaultValue={field.value}
-          onInputChange={(value: string | undefined) => {
-            field.onChange(value)
-          }}
-          contextmenu={false}
-        />
+        {language !== undefined && (
+          <CodeEditor
+            id="database-functions-editor"
+            language="pgsql"
+            placeholder={language === 'plpgsql' ? `BEGIN\n\nEND;` : undefined}
+            value={field.value}
+            onInputChange={field.onChange}
+          />
+        )}
       </FormControl_Shadcn_>
       <div
         className={cn(
@@ -42,12 +47,12 @@ export const FunctionEditor = ({
               type="text"
               size="tiny"
               className={cn(
-                'px-2 text-foreground-lighter hover:text-foreground',
+                'px-1.5 text-foreground-lighter hover:text-foreground',
                 'transition z-50'
               )}
               onClick={() => setFocused(!focused)}
               icon={focused ? <Minimize2 /> : <Maximize2 />}
-            ></Button>
+            />
           </TooltipTrigger_Shadcn_>
           <TooltipContent_Shadcn_ side="bottom">
             {focused ? 'Minimize editor' : 'Maximize editor'}
diff --git a/apps/studio/components/interfaces/Database/Functions/CreateFunction/index.tsx b/apps/studio/components/interfaces/Database/Functions/CreateFunction/index.tsx
index c8db848536d..e0950b10feb 100644
--- a/apps/studio/components/interfaces/Database/Functions/CreateFunction/index.tsx
+++ b/apps/studio/components/interfaces/Database/Functions/CreateFunction/index.tsx
@@ -39,7 +39,6 @@ import {
   SheetSection,
   Toggle,
   cn,
-  useWatch_Shadcn_,
 } from 'ui'
 import ConfirmationModal from 'ui-patterns/Dialogs/ConfirmationModal'
 import { FormItemLayout } from 'ui-patterns/form/FormItemLayout/FormItemLayout'
@@ -82,6 +81,7 @@ const CreateFunction = ({ func, visible, setVisible }: CreateFunctionProps) => {
   const form = useForm<z.infer<typeof FormSchema>>({
     resolver: zodResolver(FormSchema),
   })
+  const language = form.watch('language')
 
   const { mutate: createDatabaseFunction, isLoading: isCreating } =
     useDatabaseFunctionCreateMutation()
@@ -256,11 +256,7 @@ const CreateFunction = ({ func, visible, setVisible }: CreateFunctionProps) => {
                         </FormLabel_Shadcn_>
                         <FormDescription_Shadcn_ className="text-sm text-foreground-light">
                           <p>
-                            The language below should be written in{' '}
-                            <code>
-                              <FormLanguage />
-                            </code>
-                            .
+                            The language below should be written in <code>{language}</code>.
                           </p>
                           {!isEditing && <p>Change the language in the Advanced Settings below.</p>}
                         </FormDescription_Shadcn_>
@@ -273,6 +269,7 @@ const CreateFunction = ({ func, visible, setVisible }: CreateFunctionProps) => {
                       >
                         <FunctionEditor
                           field={field}
+                          language={language}
                           focused={focusedEditor}
                           setFocused={setFocusedEditor}
                         />
@@ -647,9 +644,3 @@ const FormFieldLanguage = () => {
     />
   )
 }
-
-const FormLanguage = () => {
-  const language = useWatch_Shadcn_({ name: 'language' })
-
-  return language
-}
diff --git a/apps/studio/components/ui/CodeEditor/CodeEditor.tsx b/apps/studio/components/ui/CodeEditor/CodeEditor.tsx
index f955a339e97..24eeb0d677d 100644
--- a/apps/studio/components/ui/CodeEditor/CodeEditor.tsx
+++ b/apps/studio/components/ui/CodeEditor/CodeEditor.tsx
@@ -1,10 +1,11 @@
-import Editor, { EditorProps, OnMount } from '@monaco-editor/react'
+import Editor, { EditorProps, Monaco, OnChange, OnMount } from '@monaco-editor/react'
 import { merge, noop } from 'lodash'
 import { editor } from 'monaco-editor'
-import { useRef } from 'react'
-import { cn } from 'ui'
+import { useEffect, useRef, useState } from 'react'
 
+import { Markdown } from 'components/interfaces/Markdown'
 import { timeout } from 'lib/helpers'
+import { cn } from 'ui'
 import { Loading } from '../Loading'
 import { alignEditor } from './CodeEditor.utils'
 
@@ -21,6 +22,8 @@ interface CodeEditorProps {
   loading?: boolean
   options?: EditorProps['options']
   value?: string
+  placeholder?: string
+  disableTabToUsePlaceholder?: boolean
 }
 
 const CodeEditor = ({
@@ -36,13 +39,47 @@ const CodeEditor = ({
   loading,
   options,
   value,
+  placeholder,
+  disableTabToUsePlaceholder = false,
 }: CodeEditorProps) => {
+  const hasValue = useRef<any>()
+
   const editorRef = useRef<editor.IStandaloneCodeEditor>()
+  const monacoRef = useRef<Monaco>()
+
+  const showPlaceholderDefault = placeholder !== undefined && (value ?? '').trim().length === 0
+  const [showPlaceholder, setShowPlaceholder] = useState(showPlaceholderDefault)
 
   const onMount: OnMount = async (editor, monaco) => {
     editorRef.current = editor
+    monacoRef.current = monaco
     alignEditor(editor)
 
+    hasValue.current = editor.createContextKey('hasValue', false)
+    hasValue.current.set(value !== undefined && value.trim().length > 0)
+    setShowPlaceholder(showPlaceholderDefault)
+
+    if (!disableTabToUsePlaceholder) {
+      editor.addCommand(
+        monaco.KeyCode.Tab,
+        () => {
+          editor.executeEdits('source', [
+            {
+              // @ts-ignore
+              identifier: 'add-placeholder',
+              range: new monaco.Range(1, 1, 1, 1),
+              text: (placeholder ?? '')
+                .split('\n\n')
+                .join('\n')
+                .replaceAll('*', '')
+                .replaceAll('&nbsp;', ''),
+            },
+          ])
+        },
+        '!hasValue'
+      )
+    }
+
     editor.addAction({
       id: 'supabase',
       label: 'Run Query',
@@ -57,10 +94,22 @@ const CodeEditor = ({
       },
     })
 
+    const model = editor.getModel()
+    if (model) {
+      const position = model.getPositionAt((value ?? '').length)
+      editor.setPosition(position)
+    }
+
     await timeout(500)
     if (autofocus) editor?.focus()
   }
 
+  const onChangeContent: OnChange = (value) => {
+    hasValue.current.set((value ?? '').length > 0)
+    setShowPlaceholder(!value)
+    onInputChange(value)
+  }
+
   const optionsMerged = merge(
     {
       tabSize: 2,
@@ -72,27 +121,73 @@ const CodeEditor = ({
       contextmenu: true,
       lineNumbers: hideLineNumbers ? 'off' : undefined,
       glyphMargin: hideLineNumbers ? false : undefined,
-      lineNumbersMinChars: hideLineNumbers ? 0 : undefined,
+      lineNumbersMinChars: hideLineNumbers ? 0 : 4,
       folding: hideLineNumbers ? false : undefined,
+      scrollBeyondLastLine: false,
     },
     options
   )
 
-  merge({ cpp: '12' }, { java: '23' }, { python: '35' })
+  useEffect(() => {
+    setShowPlaceholder(showPlaceholderDefault)
+  }, [showPlaceholderDefault])
+
+  useEffect(() => {
+    if (
+      !disableTabToUsePlaceholder &&
+      editorRef.current !== undefined &&
+      monacoRef.current !== undefined
+    ) {
+      const editor = editorRef.current
+      const monaco = monacoRef.current
+
+      editor.addCommand(
+        monaco.KeyCode.Tab,
+        () => {
+          editor.executeEdits('source', [
+            {
+              // @ts-ignore
+              identifier: 'add-placeholder',
+              range: new monaco.Range(1, 1, 1, 1),
+              text: (placeholder ?? '  ')
+                .split('\n\n')
+                .join('\n')
+                .replaceAll('*', '')
+                .replaceAll('&nbsp;', ''),
+            },
+          ])
+        },
+        '!hasValue'
+      )
+    }
+  }, [placeholder, disableTabToUsePlaceholder])
 
   return (
-    <Editor
-      path={id}
-      theme="supabase"
-      className={cn(className, 'monaco-editor')}
-      value={value ?? undefined}
-      language={language}
-      defaultValue={defaultValue ?? undefined}
-      loading={loading || <Loading />}
-      options={optionsMerged}
-      onMount={onMount}
-      onChange={onInputChange}
-    />
+    <>
+      <Editor
+        path={id}
+        theme="supabase"
+        className={cn(className, 'monaco-editor')}
+        value={value ?? undefined}
+        language={language}
+        defaultValue={defaultValue ?? undefined}
+        loading={loading || <Loading />}
+        options={optionsMerged}
+        onMount={onMount}
+        onChange={onChangeContent}
+      />
+      {placeholder !== undefined && (
+        <div
+          className={cn(
+            'monaco-placeholder absolute top-[3px] left-[57px] text-sm pointer-events-none font-mono',
+            '[&>div>p]:text-foreground-lighter [&>div>p]:!m-0 tracking-tighter',
+            showPlaceholder ? 'block' : 'hidden'
+          )}
+        >
+          <Markdown content={placeholder} />
+        </div>
+      )}
+    </>
   )
 }
 
diff --git a/apps/studio/components/ui/SqlEditor.tsx b/apps/studio/components/ui/SqlEditor.tsx
index 15ab2f73845..ad982e4ebbc 100644
--- a/apps/studio/components/ui/SqlEditor.tsx
+++ b/apps/studio/components/ui/SqlEditor.tsx
@@ -16,6 +16,9 @@ interface SqlEditorProps {
   readOnly?: boolean
 }
 
+/**
+ * @deprecated Use CodeEditor instead
+ */
 const SqlEditor = ({
   queryId,
   language = 'pgsql',