diff --git a/nostr-sdk/CHANGELOG.md b/nostr-sdk/CHANGELOG.md
index dc65dd5e0..09414b8b8 100644
--- a/nostr-sdk/CHANGELOG.md
+++ b/nostr-sdk/CHANGELOG.md
@@ -27,6 +27,12 @@
 
 -->
 
+## Unreleased
+
+### Changed
+
+- local_relay: improve `max_query_results` handling (https://github.com/nostrdevkit/nostr/pull/1457)
+
 ## v0.45.2 - 2026/08/19
 
 ### Fixed
diff --git a/nostr-sdk/src/local_relay/local/inner.rs b/nostr-sdk/src/local_relay/local/inner.rs
index b2f7544b5..eaf8ddf24 100644
--- a/nostr-sdk/src/local_relay/local/inner.rs
+++ b/nostr-sdk/src/local_relay/local/inner.rs
@@ -1316,19 +1316,8 @@ impl InnerLocalRelay {
             }
         }
 
-        // Cap each query and the merged result so multiple filters cannot multiply output.
-        for filter in filters.iter_mut() {
-            let requested_limit = filter.limit.unwrap_or_else(|| {
-                filter
-                    .ids
-                    .as_ref()
-                    .map_or(self.default_filter_limit, |ids| ids.len())
-            });
-            let per_filter_limit = self
-                .max_filter_limit
-                .map_or(requested_limit, |max| requested_limit.min(max));
-            filter.limit = Some(per_filter_limit.min(self.max_query_results));
-        }
+        // set the correct limit for the filters
+        self.set_filters_limit(&mut filters);
 
         // Check if subscription has IDs
         let ids_len: Option<usize> = filters
@@ -1462,6 +1451,34 @@ impl InnerLocalRelay {
 
         GiftWrapQueryAccess::Allowed
     }
+
+    /// Ensures that each filter's effective limit respects the configured
+    /// `max_filter_limit` and that the combined limits across all filters do
+    /// not exceed `max_query_results`.
+    fn set_filters_limit(&self, filters: &mut [Filter]) {
+        let mut total_limit: usize = 0;
+        for filter in filters.iter_mut() {
+            // Determine the effective limit for this filter:
+            // - If an ID set exists, its length; otherwise the filter's own limit.
+            // - Cap that value by `max_filter_limit`.
+            // - Fall back to `default_filter_limit` if both are absent.
+            let limit = (filter.ids.as_ref().map(BTreeSet::len).or(filter.limit))
+                .min(self.max_filter_limit)
+                .unwrap_or(self.default_filter_limit);
+
+            filter.limit = Some(limit);
+            total_limit = total_limit.saturating_add(limit);
+        }
+
+        // If the sum of all limits exceeds the maximum allowed query results,
+        // redistribute the budget equally among all filters.
+        if total_limit > self.max_query_results {
+            // TODO: Set per-filter limits instead of a global one; filters
+            // matching a single id should have a limit of 1.
+            let new_limit = self.max_query_results.div_ceil(filters.len());
+            filters.iter_mut().for_each(|f| f.limit = Some(new_limit));
+        }
+    }
 }
 
 #[inline]
diff --git a/nostr-sdk/src/local_relay/mod.rs b/nostr-sdk/src/local_relay/mod.rs
index 0cc6fb9ad..b816393ed 100644
--- a/nostr-sdk/src/local_relay/mod.rs
+++ b/nostr-sdk/src/local_relay/mod.rs
@@ -232,4 +232,50 @@ mod tests {
             output.failed.values().next().unwrap()
         );
     }
+
+    #[tokio::test]
+    async fn test_max_query_results() {
+        let relay = LocalRelay::builder()
+            .database(MemoryDatabase::unbounded())
+            .max_query_results(6)
+            .build();
+        relay.run().await.unwrap();
+
+        let keys = Keys::generate();
+        let client = Client::default();
+
+        client
+            .add_relay(relay.url().await)
+            .and_connect()
+            .await
+            .unwrap();
+
+        for i in 0..10 {
+            client
+                .send_event(
+                    &EventBuilder::new(
+                        if i % 2 == 1 {
+                            Kind::TextNote
+                        } else {
+                            Kind::Comment
+                        },
+                        i.to_string(),
+                    )
+                    .finalize(&keys)
+                    .unwrap(),
+                )
+                .await
+                .unwrap();
+        }
+
+        let result = client
+            .fetch_events([
+                Filter::new().kind(Kind::TextNote),
+                Filter::new().kind(Kind::Comment),
+            ])
+            .await
+            .unwrap();
+
+        assert_eq!(6, result.len(), "max_query_results is 6");
+    }
 }