diff --git a/packages/svelte/src/compiler/phases/3-transform/server/visitors/SvelteBoundary.js b/packages/svelte/src/compiler/phases/3-transform/server/visitors/SvelteBoundary.js
index c15c5a1a27..d208c8ad27 100644
--- a/packages/svelte/src/compiler/phases/3-transform/server/visitors/SvelteBoundary.js
+++ b/packages/svelte/src/compiler/phases/3-transform/server/visitors/SvelteBoundary.js
@@ -1,88 +1,122 @@
-/** @import { BlockStatement, Identifier, Statement, Expression } from 'estree' */
+/** @import { BlockStatement, Identifier, Statement, Expression, MaybeNamedFunctionDeclaration, Pattern } from 'estree' */
 /** @import { AST } from '#compiler' */
 /** @import { ComponentContext } from '../types' */
 import { attr } from 'svelte/internal/client';
 import { BLOCK_CLOSE, BLOCK_OPEN } from '../../../../../internal/server/hydration.js';
 import * as b from '../../../../utils/builders.js';
+import { extract_identifiers } from '../../../../utils/ast.js';
 
 /**
  * @param {AST.SvelteBoundary} node
  * @param {ComponentContext} context
  */
 export function SvelteBoundary(node, context) {
-	const props = b.object([]);
-
-	const nodes = [];
-
 	/** @type {Statement[]} */
 	const statements = [];
 
-	/** @type {Expression | null} */
-	let call_expression = null;
+	/** @type {AST.SnippetBlock | null} */
+	let snippet = null;
+
+	/** @type {AST.ConstTag[]} */
+	let const_tags = [];
+
+	const nodes = [];
 
 	const payload = b.id('$$payload'); // correct ?
-	const out_pos = b.id('$$pos');
-	let err_id = b.id('$$err');
 
-	/** @type {Statement[]} */
-	let catch_statements = [
-		b.stmt(
-			b.assignment(
-				'=',
-				b.member(payload, 'out'),
-				b.call(b.member(payload, 'out.substring'), b.literal(0), out_pos)
-			)
-		)
-	];
-
-	statements.push(
-		b.declaration('const', [b.declarator(out_pos.name, b.member(payload, 'out.length'))])
-	);
+	/** @type {Expression | undefined} */
+	let failed;
 
 	// Capture the `failed` explicit snippet prop
 	for (const attribute of node.attributes) {
 		if (attribute.type === 'Attribute' && attribute.name === 'failed' && attribute.value !== true) {
-			/** @type {Statement[]} */
-			const init = [];
-			context.visit(attribute, { ...context.state, init });
-			statements.push(...init);
-
 			const chunk = Array.isArray(attribute.value)
 				? /** @type {AST.ExpressionTag} */ (attribute.value[0])
 				: attribute.value;
-			call_expression = /** @type {Expression} */ (context.visit(chunk.expression, context.state));
+			failed = /** @type {Expression} */ (context.visit(chunk.expression, context.state));
 		}
 	}
 
 	// Capture the `failed` implicit snippet prop
 	for (const child of node.fragment.nodes) {
 		if (child.type === 'SnippetBlock' && child.expression.name === 'failed') {
+			snippet = child;
+
 			/** @type {Statement[]} */
 			const init = [];
-			context.visit(child, { ...context.state, init });
-			catch_statements.push(...init);
-			call_expression = child.expression;
+			context.visit(snippet, { ...context.state, init });
+
+			if (init.length === 1 && init[0].type === 'FunctionDeclaration') {
+				failed = b.arrow(init[0].params, init[0].body);
+			} else {
+				statements.push(...init);
+				failed = b.id('failed');
+			}
 		} else if (child.type === 'ConstTag') {
+			const_tags.push(child);
+		} else {
+			nodes.push(child);
+		}
+	}
+
+	if (snippet && has_const_referenced(context, snippet, const_tags)) {
+		for (const tag of const_tags) {
 			/** @type {Statement[]} */
 			const init = [];
-			context.visit(child, { ...context.state, init });
+			context.visit(tag, { ...context.state, init });
 			statements.push(...init);
-		} else {
-			nodes.push(child);
 		}
+	} else if (const_tags.length) {
+		nodes.unshift(...const_tags);
 	}
 
-	const block = /** @type {BlockStatement} */ (context.visit({ ...node.fragment, nodes }));
+	const body = b.arrow(
+		[b.id('$$payload')],
+		/** @type {BlockStatement} */ (context.visit({ ...node.fragment, nodes }))
+	);
 
-	if (call_expression) {
-		catch_statements.push(b.stmt(b.call(call_expression, payload, err_id)));
+	statements.push(b.stmt(b.call('$.boundary', payload, body, failed)));
+
+	if (statements.length === 1) {
+		context.state.template.push(statements[0]);
+	} else {
+		context.state.template.push(b.block([...statements]));
 	}
+}
 
-	statements.push(b.try_catch(block, err_id, b.block(catch_statements)));
+/**
+ *
+ * @param {ComponentContext} context
+ * @param {AST.SnippetBlock} snippet
+ * @param {AST.ConstTag[]} const_tags
+ */
+function has_const_referenced(context, snippet, const_tags) {
+	if (const_tags.length === 0) {
+		return false;
+	}
 
-	context.state.template.push(
-		b.literal(BLOCK_OPEN),
-		b.block([...statements]),
-		b.literal(BLOCK_CLOSE)
-	);
+	const references = context.state.scopes.get(snippet)?.references;
+	if (references == null || references.size === 0) {
+		return false;
+	}
+
+	const identifiers = new Set();
+	for (const tag of const_tags) {
+		for (const declaration of tag.declaration.declarations) {
+			for (const id of extract_identifiers(declaration.id)) {
+				identifiers.add(id.name);
+			}
+		}
+	}
+
+	if (identifiers.size === 0) {
+		return false;
+	}
+
+	for (const reference of references.keys()) {
+		if (identifiers.has(reference)) {
+			return true;
+		}
+	}
+	return false;
 }
diff --git a/packages/svelte/src/internal/server/index.js b/packages/svelte/src/internal/server/index.js
index e8ffeed2fe..184a5d84df 100644
--- a/packages/svelte/src/internal/server/index.js
+++ b/packages/svelte/src/internal/server/index.js
@@ -14,7 +14,7 @@ import {
 import { escape_html } from '../../escaping.js';
 import { DEV } from 'esm-env';
 import { current_component, pop, push } from './context.js';
-import { EMPTY_COMMENT, BLOCK_CLOSE, BLOCK_OPEN } from './hydration.js';
+import { EMPTY_COMMENT, BLOCK_CLOSE, BLOCK_OPEN, BLOCK_OPEN_ELSE } from './hydration.js';
 import { validate_store } from '../shared/validate.js';
 import { is_boolean_attribute, is_raw_text_element, is_void } from '../../utils.js';
 import { reset_elements } from './dev.js';
@@ -552,6 +552,27 @@ export function props_id(payload) {
 	return uid;
 }
 
+/**
+ * <svelte:boundary>
+ * @param {Payload} payload
+ * @param {(payload:Payload) => void} body
+ * @param {(payload:Payload, err: any) => void} [failed]
+ * @returns {void}
+ */
+export function boundary(payload, body, failed) {
+	var inner_payload = copy_payload(payload);
+	try {
+		inner_payload.out += BLOCK_OPEN;
+		body(inner_payload);
+	} catch (err) {
+		inner_payload = copy_payload(payload);
+		inner_payload.out += BLOCK_OPEN_ELSE;
+		failed?.(inner_payload, err);
+	}
+	inner_payload.out += BLOCK_CLOSE;
+	assign_payload(payload, inner_payload);
+}
+
 export { attr, clsx };
 
 export { html } from './blocks/html.js';