diff --git a/conf/configuration.go b/conf/configuration.go
index 3e3b42355..0d32815ee 100644
--- a/conf/configuration.go
+++ b/conf/configuration.go
@@ -46,6 +46,7 @@ type configOptions struct {
 	EnableTranscodingCancellation   bool
 	EnableDownloads                 bool
 	EnableExternalServices          bool
+	EnableM3UExternalAlbumArt       bool
 	EnableInsightsCollector         bool
 	EnableMediaFileCoverArt         bool
 	TranscodingCacheSize            string
@@ -474,6 +475,7 @@ func parseIniFileConfiguration() {
 func disableExternalServices() {
 	log.Info("All external integrations are DISABLED!")
 	Server.EnableInsightsCollector = false
+	Server.EnableM3UExternalAlbumArt = false
 	Server.LastFM.Enabled = false
 	Server.Spotify.ID = ""
 	Server.Deezer.Enabled = false
@@ -638,6 +640,7 @@ func setViperDefaults() {
 	viper.SetDefault("smartPlaylistRefreshDelay", 5*time.Second)
 	viper.SetDefault("enabledownloads", true)
 	viper.SetDefault("enableexternalservices", true)
+	viper.SetDefault("enablem3uexternalalbumart", false)
 	viper.SetDefault("enablemediafilecoverart", true)
 	viper.SetDefault("autotranscodedownload", false)
 	viper.SetDefault("defaultdownsamplingformat", consts.DefaultDownsamplingFormat)
diff --git a/core/artwork/artwork_internal_test.go b/core/artwork/artwork_internal_test.go
index c18caf737..e2ea7adb0 100644
--- a/core/artwork/artwork_internal_test.go
+++ b/core/artwork/artwork_internal_test.go
@@ -235,6 +235,113 @@ var _ = Describe("Artwork", func() {
 			})
 		})
 	})
+	Describe("playlistArtworkReader", func() {
+		Describe("findPlaylistSidecarPath", func() {
+			It("discovers sidecar image next to playlist file", func() {
+				tmpDir := GinkgoT().TempDir()
+				plsPath := filepath.Join(tmpDir, "MyPlaylist.m3u")
+				imgPath := filepath.Join(tmpDir, "MyPlaylist.jpg")
+				Expect(os.WriteFile(plsPath, []byte("#EXTM3U\n"), 0600)).To(Succeed())
+				Expect(os.WriteFile(imgPath, []byte("fake image"), 0600)).To(Succeed())
+
+				result := findPlaylistSidecarPath(GinkgoT().Context(), plsPath)
+				Expect(result).To(Equal(imgPath))
+			})
+
+			It("returns empty string when no sidecar image exists", func() {
+				tmpDir := GinkgoT().TempDir()
+				plsPath := filepath.Join(tmpDir, "MyPlaylist.m3u")
+				Expect(os.WriteFile(plsPath, []byte("#EXTM3U\n"), 0600)).To(Succeed())
+
+				result := findPlaylistSidecarPath(GinkgoT().Context(), plsPath)
+				Expect(result).To(BeEmpty())
+			})
+
+			It("returns empty string when playlist has no path", func() {
+				result := findPlaylistSidecarPath(GinkgoT().Context(), "")
+				Expect(result).To(BeEmpty())
+			})
+
+			It("finds sidecar with different case base name", func() {
+				tmpDir := GinkgoT().TempDir()
+				plsPath := filepath.Join(tmpDir, "myplaylist.m3u")
+				imgPath := filepath.Join(tmpDir, "MyPlaylist.jpg")
+				Expect(os.WriteFile(plsPath, []byte("#EXTM3U\n"), 0600)).To(Succeed())
+				Expect(os.WriteFile(imgPath, []byte("fake image"), 0600)).To(Succeed())
+
+				result := findPlaylistSidecarPath(GinkgoT().Context(), plsPath)
+				Expect(result).To(Equal(imgPath))
+			})
+		})
+
+		Describe("fromPlaylistExternalImage", func() {
+			It("opens local path from ExternalImageURL", func() {
+				tmpDir := GinkgoT().TempDir()
+				imgPath := filepath.Join(tmpDir, "cover.jpg")
+				Expect(os.WriteFile(imgPath, []byte("external image data"), 0600)).To(Succeed())
+
+				reader := &playlistArtworkReader{
+					pl: model.Playlist{ExternalImageURL: imgPath},
+				}
+				r, path, err := reader.fromPlaylistExternalImage(ctx)()
+				Expect(err).ToNot(HaveOccurred())
+				Expect(r).ToNot(BeNil())
+				Expect(path).To(Equal(imgPath))
+				data, _ := io.ReadAll(r)
+				Expect(string(data)).To(Equal("external image data"))
+				r.Close()
+			})
+
+			It("returns nil when ExternalImageURL is empty", func() {
+				reader := &playlistArtworkReader{
+					pl: model.Playlist{ExternalImageURL: ""},
+				}
+				r, path, err := reader.fromPlaylistExternalImage(ctx)()
+				Expect(err).ToNot(HaveOccurred())
+				Expect(r).To(BeNil())
+				Expect(path).To(BeEmpty())
+			})
+
+			It("returns error when local file does not exist", func() {
+				reader := &playlistArtworkReader{
+					pl: model.Playlist{ExternalImageURL: "/non/existent/path/cover.jpg"},
+				}
+				r, _, err := reader.fromPlaylistExternalImage(ctx)()
+				Expect(err).To(HaveOccurred())
+				Expect(r).To(BeNil())
+			})
+
+			It("skips HTTP URL when EnableM3UExternalAlbumArt is false", func() {
+				conf.Server.EnableM3UExternalAlbumArt = false
+
+				reader := &playlistArtworkReader{
+					pl: model.Playlist{ExternalImageURL: "https://example.com/cover.jpg"},
+				}
+				r, path, err := reader.fromPlaylistExternalImage(ctx)()
+				Expect(err).ToNot(HaveOccurred())
+				Expect(r).To(BeNil())
+				Expect(path).To(BeEmpty())
+			})
+
+			It("still opens local path when EnableM3UExternalAlbumArt is false", func() {
+				conf.Server.EnableM3UExternalAlbumArt = false
+
+				tmpDir := GinkgoT().TempDir()
+				imgPath := filepath.Join(tmpDir, "cover.jpg")
+				Expect(os.WriteFile(imgPath, []byte("local image"), 0600)).To(Succeed())
+
+				reader := &playlistArtworkReader{
+					pl: model.Playlist{ExternalImageURL: imgPath},
+				}
+				r, path, err := reader.fromPlaylistExternalImage(ctx)()
+				Expect(err).ToNot(HaveOccurred())
+				Expect(r).ToNot(BeNil())
+				Expect(path).To(Equal(imgPath))
+				r.Close()
+			})
+		})
+	})
+
 	Describe("resizedArtworkReader", func() {
 		BeforeEach(func() {
 			folderRepo.result = []model.Folder{{
diff --git a/core/artwork/reader_playlist.go b/core/artwork/reader_playlist.go
index 09bfe221b..91d47b0b0 100644
--- a/core/artwork/reader_playlist.go
+++ b/core/artwork/reader_playlist.go
@@ -8,10 +8,14 @@ import (
 	"image/draw"
 	"image/png"
 	"io"
+	"net/url"
 	"os"
+	"path/filepath"
+	"strings"
 	"time"
 
 	"github.com/disintegration/imaging"
+	"github.com/navidrome/navidrome/conf"
 	"github.com/navidrome/navidrome/log"
 	"github.com/navidrome/navidrome/model"
 	"github.com/navidrome/navidrome/utils/slice"
@@ -36,6 +40,24 @@ func newPlaylistArtworkReader(ctx context.Context, artwork *artwork, artID model
 	}
 	a.cacheKey.artID = artID
 	a.cacheKey.lastUpdate = pl.UpdatedAt
+
+	// Check sidecar and ExternalImageURL local file ModTimes for cache invalidation.
+	// If either is newer than the playlist's UpdatedAt, use that instead so the
+	// cache is busted when a user replaces a sidecar image or local file reference.
+	for _, path := range []string{
+		findPlaylistSidecarPath(ctx, pl.Path),
+		pl.ExternalImageURL,
+	} {
+		if path == "" || strings.HasPrefix(path, "http://") || strings.HasPrefix(path, "https://") {
+			continue
+		}
+		if info, err := os.Stat(path); err == nil {
+			if info.ModTime().After(a.cacheKey.lastUpdate) {
+				a.cacheKey.lastUpdate = info.ModTime()
+			}
+		}
+	}
+
 	return a, nil
 }
 
@@ -45,26 +67,82 @@ func (a *playlistArtworkReader) LastUpdated() time.Time {
 
 func (a *playlistArtworkReader) Reader(ctx context.Context) (io.ReadCloser, string, error) {
 	return selectImageReader(ctx, a.artID,
-		a.fromPlaylistImage(),
+		a.fromPlaylistUploadedImage(),
+		a.fromPlaylistSidecar(ctx),
+		a.fromPlaylistExternalImage(ctx),
 		a.fromGeneratedTiledCover(ctx),
 		fromAlbumPlaceholder(),
 	)
 }
 
-func (a *playlistArtworkReader) fromPlaylistImage() sourceFunc {
+func (a *playlistArtworkReader) fromPlaylistUploadedImage() sourceFunc {
+	return fromLocalFile(a.pl.UploadedImagePath())
+}
+
+func (a *playlistArtworkReader) fromPlaylistSidecar(ctx context.Context) sourceFunc {
+	return fromLocalFile(findPlaylistSidecarPath(ctx, a.pl.Path))
+}
+
+func (a *playlistArtworkReader) fromPlaylistExternalImage(ctx context.Context) sourceFunc {
 	return func() (io.ReadCloser, string, error) {
-		absPath := a.pl.ArtworkPath()
-		if absPath == "" {
+		imgURL := a.pl.ExternalImageURL
+		if imgURL == "" {
 			return nil, "", nil
 		}
-		f, err := os.Open(absPath)
+		parsed, err := url.Parse(imgURL)
 		if err != nil {
 			return nil, "", err
 		}
-		return f, absPath, nil
+		if parsed.Scheme == "http" || parsed.Scheme == "https" {
+			if !conf.Server.EnableM3UExternalAlbumArt {
+				return nil, "", nil
+			}
+			return fromURL(ctx, parsed)
+		}
+		return fromLocalFile(imgURL)()
 	}
 }
 
+// fromLocalFile returns a sourceFunc that opens the given local path.
+// Returns (nil, "", nil) if path is empty — signalling "not found, try next source".
+func fromLocalFile(path string) sourceFunc {
+	return func() (io.ReadCloser, string, error) {
+		if path == "" {
+			return nil, "", nil
+		}
+		f, err := os.Open(path)
+		if err != nil {
+			return nil, "", err
+		}
+		return f, path, nil
+	}
+}
+
+// findPlaylistSidecarPath scans the directory of the playlist file for a sidecar
+// image file with the same base name (case-insensitive). Returns empty string if
+// no matching image is found or if plsPath is empty.
+func findPlaylistSidecarPath(ctx context.Context, plsPath string) string {
+	if plsPath == "" {
+		return ""
+	}
+	dir := filepath.Dir(plsPath)
+	base := strings.TrimSuffix(filepath.Base(plsPath), filepath.Ext(plsPath))
+
+	entries, err := os.ReadDir(dir)
+	if err != nil {
+		log.Warn(ctx, "Could not read directory for playlist sidecar", "dir", dir, err)
+		return ""
+	}
+	for _, entry := range entries {
+		name := entry.Name()
+		nameBase := strings.TrimSuffix(name, filepath.Ext(name))
+		if !entry.IsDir() && strings.EqualFold(nameBase, base) && model.IsImageFile(name) {
+			return filepath.Join(dir, name)
+		}
+	}
+	return ""
+}
+
 func (a *playlistArtworkReader) fromGeneratedTiledCover(ctx context.Context) sourceFunc {
 	return func() (io.ReadCloser, string, error) {
 		tiles, err := a.loadTiles(ctx)
diff --git a/core/playlists/import.go b/core/playlists/import.go
index 40e230527..4462554c7 100644
--- a/core/playlists/import.go
+++ b/core/playlists/import.go
@@ -106,6 +106,7 @@ func (s *playlists) updatePlaylist(ctx context.Context, newPls *model.Playlist)
 		newPls.Comment = pls.Comment
 		newPls.OwnerID = pls.OwnerID
 		newPls.Public = pls.Public
+		newPls.UploadedImage = pls.UploadedImage // Preserve manual upload
 		newPls.EvaluatedAt = &time.Time{}
 	} else {
 		log.Info(ctx, "Adding synced playlist", "playlist", newPls.Name, "path", newPls.Path, "owner", owner.UserName)
diff --git a/core/playlists/import_test.go b/core/playlists/import_test.go
index a42c3f3eb..5312df95d 100644
--- a/core/playlists/import_test.go
+++ b/core/playlists/import_test.go
@@ -2,7 +2,9 @@ package playlists_test
 
 import (
 	"context"
+	"fmt"
 	"os"
+	"path/filepath"
 	"strconv"
 	"strings"
 	"time"
@@ -39,6 +41,7 @@ var _ = Describe("Playlists - Import", func() {
 	Describe("ImportFile", func() {
 		var folder *model.Folder
 		BeforeEach(func() {
+			DeferCleanup(configtest.SetupConfig())
 			ps = playlists.NewPlaylists(ds)
 			ds.MockedMediaFile = &mockedMediaFileRepo{}
 			libPath, _ := os.Getwd()
@@ -93,6 +96,213 @@ var _ = Describe("Playlists - Import", func() {
 				Expect(pls.Tracks).To(HaveLen(1))
 				Expect(pls.Tracks[0].Path).To(Equal("tests/fixtures/playlists/test.mp3"))
 			})
+
+			It("parses #EXTALBUMARTURL with HTTP URL", func() {
+				conf.Server.EnableM3UExternalAlbumArt = true
+
+				pls, err := ps.ImportFile(ctx, folder, "pls-with-art-url.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(Equal("https://example.com/cover.jpg"))
+				Expect(pls.Tracks).To(HaveLen(2))
+			})
+
+			It("parses #EXTALBUMARTURL with absolute local path", func() {
+				tmpDir := GinkgoT().TempDir()
+				imgPath := filepath.Join(tmpDir, "cover.jpg")
+				Expect(os.WriteFile(imgPath, []byte("fake image"), 0600)).To(Succeed())
+
+				m3u := fmt.Sprintf("#EXTALBUMARTURL:%s\ntest.mp3\ntest.ogg\n", imgPath)
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3", "test.ogg"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(Equal(imgPath))
+			})
+
+			It("parses #EXTALBUMARTURL with relative local path", func() {
+				tmpDir := GinkgoT().TempDir()
+				Expect(os.WriteFile(filepath.Join(tmpDir, "cover.jpg"), []byte("fake image"), 0600)).To(Succeed())
+
+				m3u := "#EXTALBUMARTURL:cover.jpg\ntest.mp3\n"
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(Equal(filepath.Join(tmpDir, "cover.jpg")))
+			})
+
+			It("parses #EXTALBUMARTURL with file:// URL", func() {
+				tmpDir := GinkgoT().TempDir()
+				imgPath := filepath.Join(tmpDir, "my cover.jpg")
+				Expect(os.WriteFile(imgPath, []byte("fake image"), 0600)).To(Succeed())
+
+				m3u := fmt.Sprintf("#EXTALBUMARTURL:file://%s\ntest.mp3\n", strings.ReplaceAll(imgPath, " ", "%20"))
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(Equal(imgPath))
+			})
+
+			It("preserves + in file:// URLs (PathUnescape, not QueryUnescape)", func() {
+				tmpDir := GinkgoT().TempDir()
+				imgPath := filepath.Join(tmpDir, "A+B.jpg")
+				Expect(os.WriteFile(imgPath, []byte("fake image"), 0600)).To(Succeed())
+
+				m3u := fmt.Sprintf("#EXTALBUMARTURL:file://%s\ntest.mp3\n", imgPath)
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(Equal(imgPath))
+			})
+
+			It("rejects #EXTALBUMARTURL with absolute path outside library boundaries", func() {
+				tmpDir := GinkgoT().TempDir()
+
+				m3u := "#EXTALBUMARTURL:/etc/passwd\ntest.mp3\n"
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(BeEmpty())
+			})
+
+			It("rejects #EXTALBUMARTURL with file:// URL outside library boundaries", func() {
+				tmpDir := GinkgoT().TempDir()
+
+				m3u := "#EXTALBUMARTURL:file:///etc/passwd\ntest.mp3\n"
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(BeEmpty())
+			})
+
+			It("rejects #EXTALBUMARTURL with relative path escaping library", func() {
+				tmpDir := GinkgoT().TempDir()
+
+				m3u := "#EXTALBUMARTURL:../../etc/passwd\ntest.mp3\n"
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(BeEmpty())
+			})
+
+			It("ignores HTTP #EXTALBUMARTURL when EnableM3UExternalAlbumArt is false", func() {
+				conf.Server.EnableM3UExternalAlbumArt = false
+
+				tmpDir := GinkgoT().TempDir()
+				m3u := "#EXTALBUMARTURL:https://example.com/cover.jpg\ntest.mp3\n"
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(BeEmpty())
+			})
+
+			It("updates ExternalImageURL on re-scan even when UploadedImage is set", func() {
+				conf.Server.EnableM3UExternalAlbumArt = true
+
+				tmpDir := GinkgoT().TempDir()
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				m3u := "#EXTALBUMARTURL:https://example.com/new-cover.jpg\ntest.mp3\n"
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				existingPls := &model.Playlist{
+					ID:               "existing-id",
+					Name:             "Existing Playlist",
+					Path:             plsFile,
+					Sync:             true,
+					UploadedImage:    "existing-id.jpg",
+					ExternalImageURL: "https://example.com/old-cover.jpg",
+				}
+				mockPlsRepo.PathMap = map[string]*model.Playlist{plsFile: existingPls}
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.UploadedImage).To(Equal("existing-id.jpg"))
+				Expect(pls.ExternalImageURL).To(Equal("https://example.com/new-cover.jpg"))
+			})
+
+			It("clears ExternalImageURL on re-scan when directive is removed", func() {
+				tmpDir := GinkgoT().TempDir()
+				mockLibRepo.SetData([]model.Library{{ID: 1, Path: tmpDir}})
+				ds.MockedMediaFile = &mockedMediaFileFromListRepo{data: []string{"test.mp3"}}
+				ps = playlists.NewPlaylists(ds)
+
+				m3u := "test.mp3\n"
+				plsFile := filepath.Join(tmpDir, "test.m3u")
+				Expect(os.WriteFile(plsFile, []byte(m3u), 0600)).To(Succeed())
+
+				existingPls := &model.Playlist{
+					ID:               "existing-id",
+					Name:             "Existing Playlist",
+					Path:             plsFile,
+					Sync:             true,
+					ExternalImageURL: "https://example.com/old-cover.jpg",
+				}
+				mockPlsRepo.PathMap = map[string]*model.Playlist{plsFile: existingPls}
+
+				plsFolder := &model.Folder{ID: "1", LibraryID: 1, LibraryPath: tmpDir, Path: "", Name: ""}
+				pls, err := ps.ImportFile(ctx, plsFolder, "test.m3u")
+				Expect(err).ToNot(HaveOccurred())
+				Expect(pls.ExternalImageURL).To(BeEmpty())
+			})
 		})
 
 		Describe("NSP", func() {
@@ -125,7 +335,6 @@ var _ = Describe("Playlists - Import", func() {
 				Expect(pls.Public).To(BeFalse())
 			})
 			It("uses server default when public field is absent", func() {
-				DeferCleanup(configtest.SetupConfig())
 				conf.Server.DefaultPlaylistPublicVisibility = true
 
 				pls, err := ps.ImportFile(ctx, folder, "recently_played.nsp")
@@ -495,6 +704,24 @@ var _ = Describe("Playlists - Import", func() {
 			Expect(pls.Tracks[0].Path).To(Equal("abc/tEsT1.Mp3"))
 		})
 
+		It("parses #EXTALBUMARTURL with HTTP URL via ImportM3U", func() {
+			conf.Server.EnableM3UExternalAlbumArt = true
+
+			repo.data = []string{"tests/test.mp3"}
+			m3u := "#EXTALBUMARTURL:https://example.com/cover.jpg\n/music/tests/test.mp3\n"
+			pls, err := ps.ImportM3U(ctx, strings.NewReader(m3u))
+			Expect(err).ToNot(HaveOccurred())
+			Expect(pls.ExternalImageURL).To(Equal("https://example.com/cover.jpg"))
+		})
+
+		It("ignores relative #EXTALBUMARTURL when imported via API (no folder context)", func() {
+			repo.data = []string{"tests/test.mp3"}
+			m3u := "#EXTALBUMARTURL:cover.jpg\n/music/tests/test.mp3\n"
+			pls, err := ps.ImportM3U(ctx, strings.NewReader(m3u))
+			Expect(err).ToNot(HaveOccurred())
+			Expect(pls.ExternalImageURL).To(BeEmpty())
+		})
+
 		// Fullwidth characters (e.g., ＡＢＣＤ) are not handled by SQLite's NOCASE collation,
 		// so we need exact matching for non-ASCII characters.
 		It("matches fullwidth characters exactly (SQLite NOCASE limitation)", func() {
diff --git a/core/playlists/parse_m3u.go b/core/playlists/parse_m3u.go
index 4e79d15c6..97ed7df6f 100644
--- a/core/playlists/parse_m3u.go
+++ b/core/playlists/parse_m3u.go
@@ -11,6 +11,7 @@ import (
 	"strings"
 	"time"
 
+	"github.com/navidrome/navidrome/conf"
 	"github.com/navidrome/navidrome/log"
 	"github.com/navidrome/navidrome/model"
 	"github.com/navidrome/navidrome/utils/slice"
@@ -34,13 +35,17 @@ func (s *playlists) parseM3U(ctx context.Context, pls *model.Playlist, folder *m
 				pls.Name = line[len("#PLAYLIST:"):]
 				continue
 			}
+			if after, ok := strings.CutPrefix(line, "#EXTALBUMARTURL:"); ok {
+				pls.ExternalImageURL = resolveImageURL(after, folder, resolver.matcher)
+				continue
+			}
 			// Skip empty lines and extended info
 			if line == "" || strings.HasPrefix(line, "#") {
 				continue
 			}
 			if after, ok := strings.CutPrefix(line, "file://"); ok {
 				line = after
-				line, _ = url.QueryUnescape(line)
+				line, _ = url.PathUnescape(line)
 			}
 			if !model.IsAudioFile(line) {
 				continue
@@ -267,3 +272,53 @@ func (r *pathResolver) resolvePaths(ctx context.Context, folder *model.Folder, l
 
 	return results, nil
 }
+
+// resolveImageURL resolves an #EXTALBUMARTURL value to a storable string.
+// HTTP(S) URLs are stored as-is (gated by EnableM3UExternalAlbumArt).
+// Local paths (file://, absolute, or relative) are resolved to an absolute path
+// and validated against known library boundaries via matcher.
+func resolveImageURL(value string, folder *model.Folder, matcher *libraryMatcher) string {
+	value = strings.TrimSpace(value)
+	if value == "" {
+		return ""
+	}
+
+	// HTTP(S) URLs — store as-is, but only if external album art is enabled
+	if strings.HasPrefix(value, "http://") || strings.HasPrefix(value, "https://") {
+		if !conf.Server.EnableM3UExternalAlbumArt {
+			return ""
+		}
+		return value
+	}
+
+	// Resolve to local absolute path
+	localPath, ok := resolveLocalPath(value, folder)
+	if !ok {
+		return ""
+	}
+
+	// Validate path is within a known library
+	if libID, _ := matcher.findLibraryForPath(localPath); libID == 0 {
+		return ""
+	}
+	return localPath
+}
+
+// resolveLocalPath converts a file://, absolute, or relative path to a clean absolute path.
+// Returns ("", false) if the path cannot be resolved.
+func resolveLocalPath(value string, folder *model.Folder) (string, bool) {
+	if after, ok := strings.CutPrefix(value, "file://"); ok {
+		decoded, err := url.PathUnescape(after)
+		if err != nil {
+			return "", false
+		}
+		return filepath.Clean(decoded), true
+	}
+	if filepath.IsAbs(value) {
+		return filepath.Clean(value), true
+	}
+	if folder == nil {
+		return "", false
+	}
+	return filepath.Clean(filepath.Join(folder.AbsolutePath(), value)), true
+}
diff --git a/core/playlists/playlists.go b/core/playlists/playlists.go
index 7e881b730..0649b16a9 100644
--- a/core/playlists/playlists.go
+++ b/core/playlists/playlists.go
@@ -131,7 +131,7 @@ func (s *playlists) Delete(ctx context.Context, id string) error {
 	}
 
 	// Clean up custom cover image file if one exists
-	if path := pls.ArtworkPath(); path != "" {
+	if path := pls.UploadedImagePath(); path != "" {
 		if err := os.Remove(path); err != nil && !os.IsNotExist(err) {
 			log.Warn(ctx, "Failed to remove playlist image on delete", "path", path, err)
 		}
@@ -288,10 +288,10 @@ func (s *playlists) SetImage(ctx context.Context, playlistID string, reader io.R
 		return err
 	}
 
-	filename := playlistID + ext
-	oldPath := pls.ArtworkPath()
-	pls.ImageFile = filename
-	absPath := pls.ArtworkPath()
+	filename := pls.ImageFilename(ext)
+	oldPath := pls.UploadedImagePath()
+	pls.UploadedImage = filename
+	absPath := pls.UploadedImagePath()
 
 	if err := os.MkdirAll(filepath.Dir(absPath), 0755); err != nil {
 		return fmt.Errorf("creating playlist images directory: %w", err)
@@ -324,12 +324,12 @@ func (s *playlists) RemoveImage(ctx context.Context, playlistID string) error {
 		return err
 	}
 
-	if path := pls.ArtworkPath(); path != "" {
+	if path := pls.UploadedImagePath(); path != "" {
 		if err := os.Remove(path); err != nil && !os.IsNotExist(err) {
 			log.Warn(ctx, "Failed to remove playlist image", "path", path, err)
 		}
 	}
 
-	pls.ImageFile = ""
+	pls.UploadedImage = ""
 	return s.ds.Playlist(ctx).Put(pls)
 }
diff --git a/core/playlists/playlists_test.go b/core/playlists/playlists_test.go
index 4d42bbeb9..ec73c329a 100644
--- a/core/playlists/playlists_test.go
+++ b/core/playlists/playlists_test.go
@@ -315,14 +315,14 @@ var _ = Describe("Playlists", func() {
 			ps = playlists.NewPlaylists(ds)
 		})
 
-		It("saves image file and updates ImageFile", func() {
+		It("saves image file and updates UploadedImage", func() {
 			ctx = request.WithUser(ctx, model.User{ID: "user-1", IsAdmin: false})
 			reader := strings.NewReader("fake image data")
 			err := ps.SetImage(ctx, "pls-1", reader, ".jpg")
 			Expect(err).ToNot(HaveOccurred())
 
-			Expect(mockPlsRepo.Last.ImageFile).To(Equal("pls-1.jpg"))
-			absPath := filepath.Join(tmpDir, "artwork", "playlist", "pls-1.jpg")
+			Expect(mockPlsRepo.Last.UploadedImage).To(Equal("pls-1_my_playlist.jpg"))
+			absPath := filepath.Join(tmpDir, "artwork", "playlist", "pls-1_my_playlist.jpg")
 			data, err := os.ReadFile(absPath)
 			Expect(err).ToNot(HaveOccurred())
 			Expect(string(data)).To(Equal("fake image data"))
@@ -334,14 +334,14 @@ var _ = Describe("Playlists", func() {
 			// Upload first image
 			err := ps.SetImage(ctx, "pls-1", strings.NewReader("first"), ".png")
 			Expect(err).ToNot(HaveOccurred())
-			oldPath := filepath.Join(tmpDir, "artwork", "playlist", "pls-1.png")
+			oldPath := filepath.Join(tmpDir, "artwork", "playlist", "pls-1_my_playlist.png")
 			Expect(oldPath).To(BeAnExistingFile())
 
 			// Upload replacement image
 			err = ps.SetImage(ctx, "pls-1", strings.NewReader("second"), ".jpg")
 			Expect(err).ToNot(HaveOccurred())
 			Expect(oldPath).ToNot(BeAnExistingFile())
-			newPath := filepath.Join(tmpDir, "artwork", "playlist", "pls-1.jpg")
+			newPath := filepath.Join(tmpDir, "artwork", "playlist", "pls-1_my_playlist.jpg")
 			Expect(newPath).To(BeAnExistingFile())
 		})
 
@@ -378,19 +378,19 @@ var _ = Describe("Playlists", func() {
 			Expect(os.WriteFile(filepath.Join(imgDir, "pls-1.jpg"), []byte("img data"), 0600)).To(Succeed())
 
 			mockPlsRepo.Data = map[string]*model.Playlist{
-				"pls-1":     {ID: "pls-1", Name: "My Playlist", OwnerID: "user-1", ImageFile: "pls-1.jpg"},
+				"pls-1":     {ID: "pls-1", Name: "My Playlist", OwnerID: "user-1", UploadedImage: "pls-1.jpg"},
 				"pls-empty": {ID: "pls-empty", Name: "No Cover", OwnerID: "user-1"},
 				"pls-other": {ID: "pls-other", Name: "Other's", OwnerID: "other-user"},
 			}
 			ps = playlists.NewPlaylists(ds)
 		})
 
-		It("removes file and clears ImageFile", func() {
+		It("removes file and clears UploadedImage", func() {
 			ctx = request.WithUser(ctx, model.User{ID: "user-1", IsAdmin: false})
 			err := ps.RemoveImage(ctx, "pls-1")
 			Expect(err).ToNot(HaveOccurred())
 
-			Expect(mockPlsRepo.Last.ImageFile).To(BeEmpty())
+			Expect(mockPlsRepo.Last.UploadedImage).To(BeEmpty())
 			absPath := filepath.Join(tmpDir, "artwork", "playlist", "pls-1.jpg")
 			Expect(absPath).ToNot(BeAnExistingFile())
 		})
@@ -399,7 +399,7 @@ var _ = Describe("Playlists", func() {
 			ctx = request.WithUser(ctx, model.User{ID: "user-1", IsAdmin: false})
 			err := ps.RemoveImage(ctx, "pls-empty")
 			Expect(err).ToNot(HaveOccurred())
-			Expect(mockPlsRepo.Last.ImageFile).To(BeEmpty())
+			Expect(mockPlsRepo.Last.UploadedImage).To(BeEmpty())
 		})
 
 		It("denies non-owner", func() {
diff --git a/db/migrations/20260302021413_rename_playlist_image_fields.go b/db/migrations/20260302021413_rename_playlist_image_fields.go
new file mode 100644
index 000000000..1e9754637
--- /dev/null
+++ b/db/migrations/20260302021413_rename_playlist_image_fields.go
@@ -0,0 +1,30 @@
+package migrations
+
+import (
+	"context"
+	"database/sql"
+
+	"github.com/pressly/goose/v3"
+)
+
+func init() {
+	goose.AddMigrationContext(upRenamePlaylistImageFields, downRenamePlaylistImageFields)
+}
+
+func upRenamePlaylistImageFields(ctx context.Context, tx *sql.Tx) error {
+	_, err := tx.ExecContext(ctx, `ALTER TABLE playlist RENAME COLUMN image_file TO uploaded_image;`)
+	if err != nil {
+		return err
+	}
+	_, err = tx.ExecContext(ctx, `ALTER TABLE playlist ADD COLUMN external_image_url VARCHAR(255) DEFAULT '';`)
+	return err
+}
+
+func downRenamePlaylistImageFields(ctx context.Context, tx *sql.Tx) error {
+	_, err := tx.ExecContext(ctx, `ALTER TABLE playlist DROP COLUMN external_image_url;`)
+	if err != nil {
+		return err
+	}
+	_, err = tx.ExecContext(ctx, `ALTER TABLE playlist RENAME COLUMN uploaded_image TO image_file;`)
+	return err
+}
diff --git a/model/playlist.go b/model/playlist.go
index b6a52dcf2..5c9052eb7 100644
--- a/model/playlist.go
+++ b/model/playlist.go
@@ -9,24 +9,26 @@ import (
 	"github.com/navidrome/navidrome/conf"
 	"github.com/navidrome/navidrome/consts"
 	"github.com/navidrome/navidrome/model/criteria"
+	"github.com/navidrome/navidrome/utils"
 )
 
 type Playlist struct {
-	ID        string         `structs:"id" json:"id"`
-	Name      string         `structs:"name" json:"name"`
-	Comment   string         `structs:"comment" json:"comment"`
-	Duration  float32        `structs:"duration" json:"duration"`
-	Size      int64          `structs:"size" json:"size"`
-	SongCount int            `structs:"song_count" json:"songCount"`
-	OwnerName string         `structs:"-" json:"ownerName"`
-	OwnerID   string         `structs:"owner_id" json:"ownerId"`
-	Public    bool           `structs:"public" json:"public"`
-	Tracks    PlaylistTracks `structs:"-" json:"tracks,omitempty"`
-	Path      string         `structs:"path" json:"path"`
-	Sync      bool           `structs:"sync" json:"sync"`
-	ImageFile string         `structs:"image_file" json:"imageFile"`
-	CreatedAt time.Time      `structs:"created_at" json:"createdAt"`
-	UpdatedAt time.Time      `structs:"updated_at" json:"updatedAt"`
+	ID               string         `structs:"id" json:"id"`
+	Name             string         `structs:"name" json:"name"`
+	Comment          string         `structs:"comment" json:"comment"`
+	Duration         float32        `structs:"duration" json:"duration"`
+	Size             int64          `structs:"size" json:"size"`
+	SongCount        int            `structs:"song_count" json:"songCount"`
+	OwnerName        string         `structs:"-" json:"ownerName"`
+	OwnerID          string         `structs:"owner_id" json:"ownerId"`
+	Public           bool           `structs:"public" json:"public"`
+	Tracks           PlaylistTracks `structs:"-" json:"tracks,omitempty"`
+	Path             string         `structs:"path" json:"path"`
+	Sync             bool           `structs:"sync" json:"sync"`
+	UploadedImage    string         `structs:"uploaded_image" json:"uploadedImage"`
+	ExternalImageURL string         `structs:"external_image_url" json:"externalImageUrl,omitempty"`
+	CreatedAt        time.Time      `structs:"created_at" json:"createdAt"`
+	UpdatedAt        time.Time      `structs:"updated_at" json:"updatedAt"`
 
 	// SmartPlaylist attributes
 	Rules       *criteria.Criteria `structs:"rules" json:"rules"`
@@ -106,15 +108,29 @@ func (pls *Playlist) AddMediaFiles(mfs MediaFiles) {
 	pls.refreshStats()
 }
 
+// ImageFilename returns a human-friendly filename for an uploaded playlist cover image.
+// Format: <ID>_<clean_name><ext>, falling back to <ID><ext> if the name cleans to empty.
+func (pls Playlist) ImageFilename(ext string) string {
+	clean := utils.CleanFileName(pls.Name)
+	if clean == "" {
+		return pls.ID + ext
+	}
+	return pls.ID + "_" + clean + ext
+}
+
 func (pls Playlist) CoverArtID() ArtworkID {
 	return artworkIDFromPlaylist(pls)
 }
 
-func (pls Playlist) ArtworkPath() string {
-	if pls.ImageFile == "" {
+// UploadedImagePath returns the absolute filesystem path for a manually uploaded
+// playlist cover image. Returns empty string if no image has been uploaded.
+// This does NOT cover sidecar images or external URLs — those are resolved
+// by the artwork reader's fallback chain.
+func (pls Playlist) UploadedImagePath() string {
+	if pls.UploadedImage == "" {
 		return ""
 	}
-	return filepath.Join(conf.Server.DataFolder, consts.ArtworkFolder, "playlist", pls.ImageFile)
+	return filepath.Join(conf.Server.DataFolder, consts.ArtworkFolder, "playlist", pls.UploadedImage)
 }
 
 type Playlists []Playlist
diff --git a/model/playlist_test.go b/model/playlist_test.go
index a54cecd53..98dd4e978 100644
--- a/model/playlist_test.go
+++ b/model/playlist_test.go
@@ -7,6 +7,28 @@ import (
 )
 
 var _ = Describe("Playlist", func() {
+	Describe("ImageFilename", func() {
+		It("returns ID_cleanname.ext for a normal name", func() {
+			pls := model.Playlist{ID: "abc123", Name: "My Cool Playlist"}
+			Expect(pls.ImageFilename(".jpg")).To(Equal("abc123_my_cool_playlist.jpg"))
+		})
+
+		It("falls back to ID.ext when name cleans to empty", func() {
+			pls := model.Playlist{ID: "abc123", Name: "!!!"}
+			Expect(pls.ImageFilename(".png")).To(Equal("abc123.png"))
+		})
+
+		It("falls back to ID.ext for empty name", func() {
+			pls := model.Playlist{ID: "abc123", Name: ""}
+			Expect(pls.ImageFilename(".jpg")).To(Equal("abc123.jpg"))
+		})
+
+		It("handles names with special characters", func() {
+			pls := model.Playlist{ID: "x1", Name: "Rock & Roll! (2024)"}
+			Expect(pls.ImageFilename(".webp")).To(Equal("x1_rock__roll_2024.webp"))
+		})
+	})
+
 	Describe("ToM3U8()", func() {
 		var pls model.Playlist
 		BeforeEach(func() {
diff --git a/tests/fixtures/playlists/pls-with-art-url.m3u b/tests/fixtures/playlists/pls-with-art-url.m3u
new file mode 100644
index 000000000..9dbf180f8
--- /dev/null
+++ b/tests/fixtures/playlists/pls-with-art-url.m3u
@@ -0,0 +1,5 @@
+#EXTM3U
+#PLAYLIST:Playlist With Art
+#EXTALBUMARTURL:https://example.com/cover.jpg
+test.mp3
+test.ogg
diff --git a/ui/src/playlist/PlaylistDetails.jsx b/ui/src/playlist/PlaylistDetails.jsx
index 4c242dd2a..b24446cb9 100644
--- a/ui/src/playlist/PlaylistDetails.jsx
+++ b/ui/src/playlist/PlaylistDetails.jsx
@@ -246,7 +246,7 @@ const PlaylistDetails = (props) => {
                   <PhotoCameraIcon className={classes.overlayIcon} />
                 </IconButton>
               </Tooltip>
-              {record.imageFile && (
+              {record.uploadedImage && (
                 <Tooltip
                   title={translate('resources.playlist.actions.removeCover')}
                 >
diff --git a/utils/files.go b/utils/files.go
index 9bdc262c5..2fce307ea 100644
--- a/utils/files.go
+++ b/utils/files.go
@@ -4,11 +4,14 @@ import (
 	"os"
 	"path"
 	"path/filepath"
+	"regexp"
 	"strings"
 
 	"github.com/navidrome/navidrome/model/id"
 )
 
+var cleanFileNameRe = regexp.MustCompile(`[^a-z0-9_-]`)
+
 func TempFileName(prefix, suffix string) string {
 	return filepath.Join(os.TempDir(), prefix+id.NewRandom()+suffix)
 }
@@ -18,6 +21,20 @@ func BaseName(filePath string) string {
 	return strings.TrimSuffix(p, path.Ext(p))
 }
 
+// CleanFileName produces a filesystem-safe, human-readable version of a name.
+// It lowercases, replaces spaces with underscores, strips non-alphanumeric
+// characters (except underscore and hyphen), and truncates to 50 characters.
+func CleanFileName(name string) string {
+	s := strings.ToLower(strings.TrimSpace(name))
+	s = strings.ReplaceAll(s, " ", "_")
+	s = cleanFileNameRe.ReplaceAllString(s, "")
+	if len(s) > 50 {
+		s = s[:50]
+	}
+	s = strings.TrimRight(s, "_-")
+	return s
+}
+
 // FileExists checks if a file or directory exists
 func FileExists(path string) bool {
 	_, err := os.Stat(path)
diff --git a/utils/files_test.go b/utils/files_test.go
index dcb28aafb..72fc4f96f 100644
--- a/utils/files_test.go
+++ b/utils/files_test.go
@@ -99,6 +99,49 @@ var _ = Describe("BaseName", func() {
 	})
 })
 
+var _ = Describe("CleanFileName", func() {
+	It("lowercases and replaces spaces with underscores", func() {
+		Expect(utils.CleanFileName("My Cool Playlist")).To(Equal("my_cool_playlist"))
+	})
+
+	It("strips special characters", func() {
+		Expect(utils.CleanFileName("Rock & Roll! (2024)")).To(Equal("rock__roll_2024"))
+	})
+
+	It("handles unicode characters", func() {
+		Expect(utils.CleanFileName("Música Favorita")).To(Equal("msica_favorita"))
+	})
+
+	It("preserves hyphens", func() {
+		Expect(utils.CleanFileName("lo-fi beats")).To(Equal("lo-fi_beats"))
+	})
+
+	It("returns empty string for empty input", func() {
+		Expect(utils.CleanFileName("")).To(BeEmpty())
+	})
+
+	It("returns empty string for whitespace-only input", func() {
+		Expect(utils.CleanFileName("   ")).To(BeEmpty())
+	})
+
+	It("returns empty string when all characters are stripped", func() {
+		Expect(utils.CleanFileName("!!!@@@###")).To(BeEmpty())
+	})
+
+	It("truncates to 50 characters", func() {
+		long := strings.Repeat("abcdefghij", 10) // 100 chars
+		result := utils.CleanFileName(long)
+		Expect(len(result)).To(Equal(50))
+	})
+
+	It("trims trailing underscores and hyphens after truncation", func() {
+		// 49 a's + space + "b" = after clean: 49 a's + "_b" = 51 chars, truncated to 50 = 49 a's + "_"
+		name := strings.Repeat("a", 49) + " b"
+		result := utils.CleanFileName(name)
+		Expect(result).To(Equal(strings.Repeat("a", 49)))
+	})
+})
+
 var _ = Describe("FileExists", func() {
 	var tempFile *os.File
 	var tempDir string