We no longer dim inactive windows, add new highlight group which is intended to use for utility panels such as oil, trouble, lspsaga, mason, lazy, general floating windows, maybe even term window? Basically, just not the code window

home/.config/nvim/lua/plugs/catppuccin.lua

@@ -1,8 +1,21 @@
+local function add_new_custom_highlights()
+    local colors = require("catppuccin.palettes.macchiato");
+    local highlights = {
+        { name = "Utility", config = { bg = colors.mantle, fg = colors.text } },
+    }
+
+    for _, highlight in ipairs(highlights) do
+        vim.api.nvim_set_hl(0, highlight.name, highlight.config)
+    end
+end
+
 return {
     "catppuccin/nvim",
     name = "catppuccin",
     priority = 1000,
     config = function()
+        add_new_custom_highlights()
+
         require("catppuccin").setup({
             flavour = "macchiato",
             background = {
@@ -19,15 +32,15 @@ return {
                 mason = true,
                 semantic_tokens = true,
                 treesitter_context = true,
-                telescope = {
+                -- telescope = { -- This doesn't seem to be compatible when running the custom dropdown theme
-                    enable = true,
+                --     enable = true
-                },
+                -- },
                 cmp = true,
                 dap_ui = true,
                 dap = true,
             },
             dim_inactive = {
-                enabled = true,
+                enabled = false,
                 shade = "dark",
                 percent = 0.15,
             },
@@ -36,11 +49,12 @@ return {
             },
             custom_highlights = function(colors)
                 return {
-                    FloatBorder = { fg = colors.lavender },
+                    FloatBorder = { fg = colors.surface0 },
                     CmpItemMenu = { fg = colors.overlay2 },
-                    TelescopeNormal = { link = "NormalFloat" },
-                    TelescopeSelection = { link = "NormalFloat" },
                     CopilotSuggestion = { fg = colors.overlay2 },
+
+                    Pmenu = { link = "Utility" },
+                    PmenuSel = { bg = colors.overlay0 },
                 }
             end
         })