diff --git a/screen/categories/src/main/java/com/ivy/categories/CategoriesScreen.kt b/screen/categories/src/main/java/com/ivy/categories/CategoriesScreen.kt
index e55719c897..74d91b50e8 100644
--- a/screen/categories/src/main/java/com/ivy/categories/CategoriesScreen.kt
+++ b/screen/categories/src/main/java/com/ivy/categories/CategoriesScreen.kt
@@ -165,7 +165,7 @@ private fun BoxWithConstraintsScope.UI(
 
             if (state.showCategorySearchBar) {
                 Spacer(Modifier.height(16.dp))
-                SearchField(onSearch = {})
+                SearchField(onSearch = { onEvent(CategoriesScreenEvent.OnSearchQueryUpdate(it)) })
             }
             Spacer(Modifier.height(16.dp))
         }
@@ -797,6 +797,16 @@ fun CategoriesScreenUiTest(isDark: Boolean) {
     Preview(theme)
 }
 
+/** For screenshot testing */
+@Composable
+fun CategoriesScreenWithSearchBarUiTest(isDark: Boolean) {
+    val theme = when (isDark) {
+        true -> Theme.DARK
+        false -> Theme.LIGHT
+    }
+    Preview(theme = theme, displaySearchBarEnabled = true)
+}
+
 /** For screenshot testing */
 @Composable
 fun CategoriesScreenCompactUiTest(isDark: Boolean) {
@@ -805,4 +815,14 @@ fun CategoriesScreenCompactUiTest(isDark: Boolean) {
         false -> Theme.LIGHT
     }
     Preview(theme, compactModeEnabled = true)
+}
+
+/** For screenshot testing */
+@Composable
+fun CategoriesScreenWithSearchBarCompactUiTest(isDark: Boolean) {
+    val theme = when (isDark) {
+        true -> Theme.DARK
+        false -> Theme.LIGHT
+    }
+    Preview(theme, compactModeEnabled = true, displaySearchBarEnabled = true)
 }
\ No newline at end of file
diff --git a/screen/categories/src/main/java/com/ivy/categories/CategoriesScreenEvent.kt b/screen/categories/src/main/java/com/ivy/categories/CategoriesScreenEvent.kt
index b6e538c139..527995dbf4 100644
--- a/screen/categories/src/main/java/com/ivy/categories/CategoriesScreenEvent.kt
+++ b/screen/categories/src/main/java/com/ivy/categories/CategoriesScreenEvent.kt
@@ -17,4 +17,5 @@ sealed interface CategoriesScreenEvent {
     data class OnSortOrderModalVisible(val visible: Boolean) : CategoriesScreenEvent
     data class OnCategoryModalVisible(val categoryModalData: CategoryModalData?) :
         CategoriesScreenEvent
+    data class OnSearchQueryUpdate(val queryString: String) : CategoriesScreenEvent
 }
diff --git a/screen/categories/src/main/java/com/ivy/categories/CategoriesViewModel.kt b/screen/categories/src/main/java/com/ivy/categories/CategoriesViewModel.kt
index 56cc92f2c8..55f94fc852 100644
--- a/screen/categories/src/main/java/com/ivy/categories/CategoriesViewModel.kt
+++ b/screen/categories/src/main/java/com/ivy/categories/CategoriesViewModel.kt
@@ -9,7 +9,6 @@ import com.ivy.base.legacy.SharedPrefs
 import com.ivy.base.legacy.Transaction
 import com.ivy.base.time.TimeConverter
 import com.ivy.base.time.TimeProvider
-import com.ivy.ui.ComposeViewModel
 import com.ivy.data.repository.CategoryRepository
 import com.ivy.domain.features.Features
 import com.ivy.frp.action.thenMap
@@ -17,6 +16,7 @@ import com.ivy.frp.thenInvokeAfter
 import com.ivy.legacy.data.model.TimePeriod
 import com.ivy.legacy.datamodel.Account
 import com.ivy.legacy.utils.ioThread
+import com.ivy.ui.ComposeViewModel
 import com.ivy.wallet.domain.action.account.AccountsAct
 import com.ivy.wallet.domain.action.category.LegacyCategoryIncomeWithAccountFiltersAct
 import com.ivy.wallet.domain.action.settings.BaseCurrencyAct
@@ -55,6 +55,8 @@ class CategoriesViewModel @Inject constructor(
     private val baseCurrency = mutableStateOf("")
     private val categories =
         mutableStateOf<ImmutableList<CategoryData>>(persistentListOf<CategoryData>())
+    private val allCategories =
+        mutableStateOf<ImmutableList<CategoryData>>(persistentListOf<CategoryData>())
     private val reorderModalVisible = mutableStateOf(false)
     private val categoryModalData = mutableStateOf<CategoryModalData?>(null)
     private val sortModalVisible = mutableStateOf(false)
@@ -78,6 +80,7 @@ class CategoriesViewModel @Inject constructor(
         )
     }
 
+
     @Composable
     private fun getCompactCategoriesMode(): Boolean {
         return features.compactCategoriesMode.asEnabledState()
@@ -132,7 +135,11 @@ class CategoriesViewModel @Inject constructor(
         ioThread {
             val range = TimePeriod.currentMonth(
                 startDayOfMonth = ivyContext.startDayOfMonth
-            ).toRange(ivyContext.startDayOfMonth, timeConverter, timeProvider) // this must be monthly
+            ).toRange(
+                ivyContext.startDayOfMonth,
+                timeConverter,
+                timeProvider
+            ) // this must be monthly
 
             allAccounts = accountsAct(Unit)
             baseCurrency.value = baseCurrencyAct(Unit)
@@ -141,7 +148,7 @@ class CategoriesViewModel @Inject constructor(
                 TrnsWithRangeAndAccFiltersAct.Input(
                     range = range,
                     accountIdFilterSet = suspend { allAccounts } thenMap { it.id }
-                        thenInvokeAfter { it.toHashSet() }
+                            thenInvokeAfter { it.toHashSet() }
                 )
             )
 
@@ -177,9 +184,23 @@ class CategoriesViewModel @Inject constructor(
             }
 
             val sortedList = sortList(categories, sortOrder.value).toImmutableList()
+            this.allCategories.value = sortedList
+            this.categories.value = this.allCategories.value
+
+        }
+    }
 
-            this.categories.value = sortedList
+    private fun filterCategories(queryString: String) {
+        var unsortedList : List<CategoryData>
+        if (queryString.isNotEmpty()) {
+            unsortedList = this.allCategories.value.filter {
+                it.category.name.value.toLowerCase().contains(queryString.toLowerCase().trim())
+            }
+
+        } else {
+            unsortedList = this.allCategories.value
         }
+        this.categories.value  = sortList(unsortedList, sortOrder.value).toImmutableList()
     }
 
     private suspend fun reorder(
@@ -250,6 +271,8 @@ class CategoriesViewModel @Inject constructor(
                 is CategoriesScreenEvent.OnCategoryModalVisible -> {
                     categoryModalData.value = event.categoryModalData
                 }
+
+                is CategoriesScreenEvent.OnSearchQueryUpdate -> filterCategories(event.queryString)
             }
         }
     }
diff --git a/screen/categories/src/test/java/com/ivy/categories/CategoriesScreenPaparazziTest.kt b/screen/categories/src/test/java/com/ivy/categories/CategoriesScreenPaparazziTest.kt
index 1a8e1297a5..99396e9263 100644
--- a/screen/categories/src/test/java/com/ivy/categories/CategoriesScreenPaparazziTest.kt
+++ b/screen/categories/src/test/java/com/ivy/categories/CategoriesScreenPaparazziTest.kt
@@ -19,10 +19,24 @@ class CategoriesScreenPaparazziTest(
         }
     }
 
+    @Test
+    fun `snapshot Categories nonCompact Screen with search bar`() {
+        snapshot(theme) {
+            CategoriesScreenWithSearchBarUiTest(theme == PaparazziTheme.Dark)
+        }
+    }
+
     @Test
     fun `snapshot Categories compact Screen`() {
         snapshot(theme) {
             CategoriesScreenCompactUiTest(theme == PaparazziTheme.Dark)
         }
     }
+
+    @Test
+    fun `snapshot Categories compact Screen with search bar`() {
+        snapshot(theme) {
+            CategoriesScreenWithSearchBarCompactUiTest(theme == PaparazziTheme.Dark)
+        }
+    }
 }
\ No newline at end of file