Fix navigation rail with long labels misplaced highlights (#128324)

packages/flutter/lib/src/material/navigation_rail.dart

@@ -585,6 +585,7 @@ class _RailDestination extends StatelessWidget {
     final bool material3 = theme.useMaterial3;
     final EdgeInsets destinationPadding = (padding ?? EdgeInsets.zero).resolve(Directionality.of(context));
     Offset indicatorOffset;
+    bool applyXOffset = false;
 
     final Widget themedIcon = IconTheme(
       data: disabled
@@ -645,6 +646,7 @@ class _RailDestination extends StatelessWidget {
           );
         } else {
           final Animation<double> labelFadeAnimation = extendedTransitionAnimation.drive(CurveTween(curve: const Interval(0.0, 0.25)));
+          applyXOffset = true;
           content = Padding(
             padding: padding ?? EdgeInsets.zero,
             child: ConstrainedBox(
@@ -775,6 +777,7 @@ class _RailDestination extends StatelessWidget {
               hoverColor: colors.primary.withOpacity(0.04),
               useMaterial3: material3,
               indicatorOffset: indicatorOffset,
+              applyXOffset: applyXOffset,
               child: content,
             ),
           ),
@@ -797,6 +800,7 @@ class _IndicatorInkWell extends InkResponse {
     super.hoverColor,
     required this.useMaterial3,
     required this.indicatorOffset,
+    required this.applyXOffset,
   }) : super(
     containedInkWell: true,
     highlightShape: BoxShape.rectangle,
@@ -805,14 +809,19 @@ class _IndicatorInkWell extends InkResponse {
   );
 
   final bool useMaterial3;
+  // The offset used to position Ink highlight.
   final Offset indicatorOffset;
+  // Whether the horizontal offset from indicatorOffset should be used to position Ink highlight.
+  // If true, Ink highlight uses the indicator horizontal offset. If false, Ink highlight is centered horizontally.
+  final bool applyXOffset;
 
   @override
   RectCallback? getRectCallback(RenderBox referenceBox) {
     if (useMaterial3) {
+      final double indicatorHorizontalCenter = applyXOffset ? indicatorOffset.dx : referenceBox.size.width / 2;
       return () {
         return Rect.fromLTWH(
-          indicatorOffset.dx - (_kCircularIndicatorDiameter / 2),
+          indicatorHorizontalCenter - (_kCircularIndicatorDiameter / 2),
           indicatorOffset.dy,
           _kCircularIndicatorDiameter,
           _kIndicatorHeight,

packages/flutter/test/material/navigation_rail_test.dart

@@ -3048,6 +3048,81 @@ void main() {
     );
   });
 
+  testWidgets('NavigationRail indicator renders properly with long labels', (WidgetTester tester) async {
+    // This is a regression test for https://github.com/flutter/flutter/issues/128005.
+    await _pumpNavigationRail(
+      tester,
+      navigationRail: NavigationRail(
+        selectedIndex: 1,
+        destinations: const <NavigationRailDestination>[
+          NavigationRailDestination(
+            icon: Icon(Icons.favorite_border),
+            selectedIcon: Icon(Icons.favorite),
+            label: Text('ABCDEFGHIJKLMNOPQRSTUVWXYZ'),
+          ),
+          NavigationRailDestination(
+            icon: Icon(Icons.bookmark_border),
+            selectedIcon: Icon(Icons.bookmark),
+            label: Text('ABC'),
+          ),
+        ],
+        labelType: NavigationRailLabelType.all,
+      ),
+    );
+
+    final TestGesture gesture = await tester.createGesture(kind: PointerDeviceKind.mouse);
+    await gesture.addPointer();
+    await gesture.moveTo(tester.getCenter(find.byIcon(Icons.favorite_border)));
+    await tester.pumpAndSettle();
+
+    final RenderObject inkFeatures = tester.allRenderObjects.firstWhere((RenderObject object) => object.runtimeType.toString() == '_RenderInkFeatures');
+
+    // Default values from M3 specification.
+    const double indicatorHeight = 32.0;
+    const double destinationWidth = 72.0;
+    const double destinationHorizontalPadding = 8.0;
+    const double indicatorWidth = destinationWidth - 2 * destinationHorizontalPadding; // 56.0
+
+    // The navigation rail width is larger than default because of the first destination long label.
+    final double railWidth = tester.getSize(find.byType(NavigationRail)).width;
+
+    // Expected indicator position.
+    final double indicatorLeft = (railWidth - indicatorWidth) / 2;
+    final double indicatorRight = (railWidth + indicatorWidth) / 2;
+    final Rect indicatorRect = Rect.fromLTRB(indicatorLeft, 0.0, indicatorRight, indicatorHeight);
+    final Rect includedRect = indicatorRect;
+    final Rect excludedRect = includedRect.inflate(10);
+
+    expect(
+      inkFeatures,
+      paints
+        ..clipPath(
+          pathMatcher: isPathThat(
+            includes: <Offset>[
+              includedRect.centerLeft,
+              includedRect.topCenter,
+              includedRect.centerRight,
+              includedRect.bottomCenter,
+            ],
+            excludes: <Offset>[
+              excludedRect.centerLeft,
+              excludedRect.topCenter,
+              excludedRect.centerRight,
+              excludedRect.bottomCenter,
+            ],
+          ),
+        )
+        ..rect(
+          rect: indicatorRect,
+          color: const Color(0x0a6750a4),
+        )
+        ..rrect(
+          rrect: RRect.fromLTRBR(indicatorLeft, 72.0, indicatorRight, 104.0, const Radius.circular(16)),
+          color: const Color(0xffe8def8),
+        ),
+    );
+  });
+
   testWidgets('NavigationRail indicator scale transform', (WidgetTester tester) async {
     int selectedIndex = 0;
     Future<void> buildWidget() async {