diff --git a/.changeset/tidy-cats-stream.md b/.changeset/tidy-cats-stream.md
new file mode 100644
index 00000000000..c14e87c6a17
--- /dev/null
+++ b/.changeset/tidy-cats-stream.md
@@ -0,0 +1,5 @@
+---
+"effect": patch
+---
+
+Preserve lexical ordering in streaming template interpolation.
diff --git a/packages/effect/src/unstable/http/Template.ts b/packages/effect/src/unstable/http/Template.ts
index bc283584232..994ecd461fd 100644
--- a/packages/effect/src/unstable/http/Template.ts
+++ b/packages/effect/src/unstable/http/Template.ts
@@ -215,11 +215,12 @@ export function stream<A extends ReadonlyArray<InterpolatedWithStream>>(
     buffer = ""
   }
 
-  return Stream.flatMap(
-    Stream.fromIterable(chunks),
-    (chunk) =>
-      typeof chunk === "string" ? Stream.succeed(chunk) : Effect.isEffect(chunk) ? Stream.fromEffect(chunk) : chunk,
-    { concurrency: "unbounded" }
+  return Stream.fromIterable(chunks).pipe(
+    Stream.mapEffect(
+      (chunk) => Effect.isEffect(chunk) ? chunk : Effect.succeed(chunk),
+      { concurrency: "unbounded" }
+    ),
+    Stream.flatMap((chunk) => typeof chunk === "string" ? Stream.succeed(chunk) : chunk)
   )
 }
 
diff --git a/packages/effect/test/unstable/http/Template.test.ts b/packages/effect/test/unstable/http/Template.test.ts
new file mode 100644
index 00000000000..bbe76e7bb10
--- /dev/null
+++ b/packages/effect/test/unstable/http/Template.test.ts
@@ -0,0 +1,38 @@
+import { assert, describe, it } from "@effect/vitest"
+import { Deferred, Effect, Fiber, Stream } from "effect"
+import { TestClock } from "effect/testing"
+import { Template } from "effect/unstable/http"
+
+describe("Template", () => {
+  it.effect("preserves template segment order", () =>
+    Effect.gen(function*() {
+      const fiber = yield* Stream.runCollect(
+        Template.stream`a${Effect.delay(Effect.succeed("slow"), "1 second")}b${"fast"}c`
+      ).pipe(Effect.forkChild)
+      yield* Effect.yieldNow
+      yield* TestClock.adjust("1 second")
+      const chunks = yield* Fiber.join(fiber)
+      assert.strictEqual(chunks.join(""), "aslowbfastc")
+    }))
+
+  it.effect("evaluates effect interpolations concurrently", () =>
+    Effect.gen(function*() {
+      const firstStarted = yield* Deferred.make<void>()
+      const secondStarted = yield* Deferred.make<void>()
+      const releaseFirst = yield* Deferred.make<void>()
+      const fiber = yield* Template.stream`${
+        Deferred.succeed(firstStarted, void 0).pipe(
+          Effect.andThen(Deferred.await(releaseFirst)),
+          Effect.as("first")
+        )
+      }${Deferred.succeed(secondStarted, void 0).pipe(Effect.as("second"))}`.pipe(
+        Stream.runCollect,
+        Effect.forkChild
+      )
+      yield* Deferred.await(firstStarted)
+      yield* Effect.yieldNow
+      assert.isTrue(yield* Deferred.isDone(secondStarted))
+      yield* Deferred.succeed(releaseFirst, void 0)
+      assert.deepStrictEqual(yield* Fiber.join(fiber), ["first", "second"])
+    }))
+})