diff --git a/syft/internal/fileresolver/container_image_all_layers.go b/syft/internal/fileresolver/container_image_all_layers.go
index a2aab3983..ad7e9e0d3 100644
--- a/syft/internal/fileresolver/container_image_all_layers.go
+++ b/syft/internal/fileresolver/container_image_all_layers.go
@@ -16,8 +16,9 @@ var _ file.Resolver = (*ContainerImageAllLayers)(nil)
 
 // ContainerImageAllLayers implements path and content access for the AllLayers source option for container image data sources.
 type ContainerImageAllLayers struct {
-	img    *image.Image
-	layers []int
+	img            *image.Image
+	layers         []int
+	markVisibility bool
 }
 
 // NewFromContainerImageAllLayers returns a new resolver from the perspective of all image layers for the given image.
@@ -33,6 +34,10 @@ func NewFromContainerImageAllLayers(img *image.Image) (*ContainerImageAllLayers,
 	return &ContainerImageAllLayers{
 		img:    img,
 		layers: layers,
+		// This is the entrypoint for the user-facing implementation, which should always annotate locations.
+		// We have other resolvers that use this implementation that are already responsible
+		// for marking visibility, so we don't need to do it all of the time (a small performance optimization).
+		markVisibility: true,
 	}, nil
 }
 
@@ -112,7 +117,9 @@ func (r *ContainerImageAllLayers) FilesByPath(paths ...string) ([]file.Location,
 				return nil, err
 			}
 			for _, result := range results {
-				uniqueLocations = append(uniqueLocations, file.NewLocationFromImage(path, result, r.img))
+				l := file.NewLocationFromImage(path, result, r.img)
+				r.annotateLocation(&l)
+				uniqueLocations = append(uniqueLocations, l)
 			}
 		}
 	}
@@ -156,7 +163,9 @@ func (r *ContainerImageAllLayers) FilesByGlob(patterns ...string) ([]file.Locati
 					return nil, err
 				}
 				for _, refResult := range refResults {
-					uniqueLocations = append(uniqueLocations, file.NewLocationFromImage(string(result.RequestPath), refResult, r.img))
+					l := file.NewLocationFromImage(string(result.RequestPath), refResult, r.img)
+					r.annotateLocation(&l)
+					uniqueLocations = append(uniqueLocations, l)
 				}
 			}
 		}
@@ -172,7 +181,7 @@ func (r *ContainerImageAllLayers) RelativeFileByPath(location file.Location, pat
 
 	exists, relativeRef, err := layer.SquashedTree.File(stereoscopeFile.Path(path), filetree.FollowBasenameLinks)
 	if err != nil {
-		log.Errorf("failed to find path=%q in squash: %+w", path, err)
+		log.Errorf("failed to find path=%q in squash: %+v", path, err)
 		return nil
 	}
 	if !exists && !relativeRef.HasReference() {
@@ -180,6 +189,7 @@ func (r *ContainerImageAllLayers) RelativeFileByPath(location file.Location, pat
 	}
 
 	relativeLocation := file.NewLocationFromImage(path, *relativeRef.Reference, r.img)
+	r.annotateLocation(&relativeLocation)
 
 	return &relativeLocation
 }
@@ -228,7 +238,9 @@ func (r *ContainerImageAllLayers) FilesByMIMEType(types ...string) ([]file.Locat
 				return nil, err
 			}
 			for _, refResult := range refResults {
-				uniqueLocations = append(uniqueLocations, file.NewLocationFromImage(string(ref.RequestPath), refResult, r.img))
+				l := file.NewLocationFromImage(string(ref.RequestPath), refResult, r.img)
+				r.annotateLocation(&l)
+				uniqueLocations = append(uniqueLocations, l)
 			}
 		}
 	}
@@ -243,10 +255,12 @@ func (r *ContainerImageAllLayers) AllLocations(ctx context.Context) <-chan file.
 		for _, layerIdx := range r.layers {
 			tree := r.img.Layers[layerIdx].Tree
 			for _, ref := range tree.AllFiles(stereoscopeFile.AllTypes()...) {
+				l := file.NewLocationFromImage(string(ref.RealPath), ref, r.img)
+				r.annotateLocation(&l)
 				select {
 				case <-ctx.Done():
 					return
-				case results <- file.NewLocationFromImage(string(ref.RealPath), ref, r.img):
+				case results <- l:
 					continue
 				}
 			}
@@ -258,3 +272,36 @@ func (r *ContainerImageAllLayers) AllLocations(ctx context.Context) <-chan file.
 func (r *ContainerImageAllLayers) FileMetadataByLocation(location file.Location) (file.Metadata, error) {
 	return fileMetadataByLocation(r.img, location)
 }
+
+func (r *ContainerImageAllLayers) annotateLocation(l *file.Location) {
+	if !r.markVisibility || l == nil {
+		return
+	}
+
+	givenRef := l.Reference()
+	annotation := file.VisibleAnnotation
+
+	// if we find a location for a path that matches the query (e.g. **/node_modules) but is not present in the squashed tree, skip it
+	ref, err := r.img.SquashedSearchContext.SearchByPath(l.RealPath, filetree.DoNotFollowDeadBasenameLinks)
+	if err != nil || !ref.HasReference() {
+		annotation = file.HiddenAnnotation
+	} else if ref.ID() != givenRef.ID() {
+		// we may have the path in the squashed tree, but this must not be in the same layer
+		annotation = file.HiddenAnnotation
+	}
+
+	// not only should the real path to the file exist, but the way we took to get there should also exist
+	// (e.g. if we are looking for /etc/passwd, but the real path is /etc/passwd -> /etc/passwd-1, then we should
+	// make certain that /etc/passwd-1 exists)
+	if annotation == file.VisibleAnnotation && l.AccessPath != "" {
+		ref, err := r.img.SquashedSearchContext.SearchByPath(l.AccessPath, filetree.DoNotFollowDeadBasenameLinks)
+		if err != nil || !ref.HasReference() {
+			annotation = file.HiddenAnnotation
+		} else if ref.ID() != givenRef.ID() {
+			// we may have the path in the squashed tree, but this must not be in the same layer
+			annotation = file.HiddenAnnotation
+		}
+	}
+
+	l.Annotations[file.VisibleAnnotationKey] = annotation
+}
diff --git a/syft/internal/fileresolver/container_image_all_layers_test.go b/syft/internal/fileresolver/container_image_all_layers_test.go
index cee562b9d..7d36baa8b 100644
--- a/syft/internal/fileresolver/container_image_all_layers_test.go
+++ b/syft/internal/fileresolver/container_image_all_layers_test.go
@@ -522,16 +522,26 @@ func TestAllLayersResolver_AllLocations(t *testing.T) {
 	paths := strset.New()
 	ctx, cancel := context.WithCancel(context.Background())
 	defer cancel()
+	visibleSet := strset.New()
+	hiddenSet := strset.New()
 	for loc := range resolver.AllLocations(ctx) {
 		paths.Add(loc.RealPath)
+		switch loc.Annotations[file.VisibleAnnotationKey] {
+		case file.VisibleAnnotation:
+			visibleSet.Add(loc.RealPath)
+		case file.HiddenAnnotation:
+			hiddenSet.Add(loc.RealPath)
+		case "":
+			t.Errorf("expected visibility annotation for location: %+v", loc)
+		}
 	}
-	expected := []string{
+	visible := []string{
 		"/Dockerfile",
-		"/file-1.txt",
-		"/file-3.txt",
+		"/file-3.txt", // this is a deadlink pointing to /file-1.txt (which has been deleted)
 		"/target",
 		"/target/file-2.txt",
-
+	}
+	hidden := []string{
 		"/.wh.bin",
 		"/.wh.file-1.txt",
 		"/.wh.lib",
@@ -619,6 +629,7 @@ func TestAllLayersResolver_AllLocations(t *testing.T) {
 		"/bin/usleep",
 		"/bin/watch",
 		"/bin/zcat",
+		"/file-1.txt",
 		"/lib",
 		"/lib/apk",
 		"/lib/apk/db",
@@ -641,15 +652,41 @@ func TestAllLayersResolver_AllLocations(t *testing.T) {
 		"/lib/sysctl.d/00-alpine.conf",
 	}
 
-	// depending on how the image is built (either from linux or mac), sys and proc might accidentally be added to the image.
-	// this isn't important for the test, so we remove them.
-	paths.Remove("/proc", "/sys", "/dev", "/etc")
+	var expected []string
+	expected = append(expected, visible...)
+	expected = append(expected, hidden...)
+	sort.Strings(expected)
 
-	// Remove cache created by Mac Rosetta when emulating different arches
-	paths.Remove("/.cache/rosetta", "/.cache")
+	cleanPaths := func(s *strset.Set) {
+		// depending on how the image is built (either from linux or mac), sys and proc might accidentally be added to the image.
+		// this isn't important for the test, so we remove them.
+		s.Remove("/proc", "/sys", "/dev", "/etc")
+
+		// Remove cache created by Mac Rosetta when emulating different arches
+		s.Remove("/.cache/rosetta", "/.cache")
+	}
+
+	cleanPaths(paths)
+	cleanPaths(visibleSet)
+	cleanPaths(hiddenSet)
 
 	pathsList := paths.List()
 	sort.Strings(pathsList)
+	visibleSetList := visibleSet.List()
+	sort.Strings(visibleSetList)
+	hiddenSetList := hiddenSet.List()
+	sort.Strings(hiddenSetList)
+
+	if d := cmp.Diff(expected, pathsList); d != "" {
+		t.Errorf("unexpected paths (-want +got):\n%s", d)
+	}
+
+	if d := cmp.Diff(visible, visibleSetList); d != "" {
+		t.Errorf("unexpected visible paths (-want +got):\n%s", d)
+	}
+
+	if d := cmp.Diff(hidden, hiddenSetList); d != "" {
+		t.Errorf("unexpected hidden paths (-want +got):\n%s", d)
+	}
 
-	assert.ElementsMatchf(t, expected, pathsList, "expected all paths to be indexed, but found different paths: \n%s", cmp.Diff(expected, paths.List()))
 }
diff --git a/syft/internal/fileresolver/container_image_deep_squash.go b/syft/internal/fileresolver/container_image_deep_squash.go
index 0666d6928..f8ecc9af2 100644
--- a/syft/internal/fileresolver/container_image_deep_squash.go
+++ b/syft/internal/fileresolver/container_image_deep_squash.go
@@ -31,6 +31,9 @@ func NewFromContainerImageDeepSquash(img *image.Image) (*ContainerImageDeepSquas
 		return nil, err
 	}
 
+	// we will do the work here to mark visibility with results from two resolvers (don't do the work twice!)
+	allLayers.markVisibility = false
+
 	return &ContainerImageDeepSquash{
 		squashed:  squashed,
 		allLayers: allLayers,