diff --git a/src/filesystem/__tests__/move-file.test.ts b/src/filesystem/__tests__/move-file.test.ts
new file mode 100644
index 0000000000..91e89423e5
--- /dev/null
+++ b/src/filesystem/__tests__/move-file.test.ts
@@ -0,0 +1,134 @@
+import { describe, it, expect, beforeEach, afterEach } from 'vitest';
+import * as fs from 'fs/promises';
+import * as path from 'path';
+import * as os from 'os';
+import { Client } from '@modelcontextprotocol/sdk/client/index.js';
+import { StdioClientTransport } from '@modelcontextprotocol/sdk/client/stdio.js';
+
+describe('move_file tool', () => {
+  let client: Client;
+  let transport: StdioClientTransport;
+  let testDir: string;
+
+  beforeEach(async () => {
+    // Create a temp directory for testing
+    const tmpDir = await fs.mkdtemp(path.join(os.tmpdir(), 'mcp-fs-move-test-'));
+    testDir = await fs.realpath(tmpDir);
+
+    // Start the MCP server with testDir as allowed directory
+    const serverPath = path.resolve(__dirname, '../dist/index.js');
+    transport = new StdioClientTransport({
+      command: 'node',
+      args: [serverPath, testDir],
+    });
+
+    client = new Client(
+      { name: 'move-file-test-client', version: '1.0.0' },
+      { capabilities: {} }
+    );
+
+    await client.connect(transport);
+  });
+
+  afterEach(async () => {
+    await client?.close();
+    await fs.rm(testDir, { recursive: true, force: true });
+  });
+
+  it('should successfully move a file when destination does not exist', async () => {
+    const sourcePath = path.join(testDir, 'source.txt');
+    const destPath = path.join(testDir, 'moved.txt');
+    await fs.writeFile(sourcePath, 'hello world');
+
+    const result = await client.callTool({
+      name: 'move_file',
+      arguments: {
+        source: sourcePath,
+        destination: destPath,
+      },
+    });
+
+    expect(result.isError).toBeFalsy();
+    const content = result.content as Array<{ type: string; text: string }>;
+    expect(content[0].text).toContain(`Successfully moved ${sourcePath} to ${destPath}`);
+
+    // Verify source no longer exists and dest has content
+    await expect(fs.stat(sourcePath)).rejects.toThrow();
+    const destContent = await fs.readFile(destPath, 'utf-8');
+    expect(destContent).toBe('hello world');
+  });
+
+  it('should fail when destination file already exists and not overwrite it (issue #4628)', async () => {
+    const sourcePath = path.join(testDir, 'source.txt');
+    const destPath = path.join(testDir, 'dest.txt');
+    await fs.writeFile(sourcePath, 'original source content');
+    await fs.writeFile(destPath, 'original destination content');
+
+    const result = await client.callTool({
+      name: 'move_file',
+      arguments: {
+        source: sourcePath,
+        destination: destPath,
+      },
+    });
+
+    // Tool should report error
+    expect(result.isError).toBe(true);
+    const content = result.content as Array<{ type: string; text: string }>;
+    expect(content[0].text).toContain(`Destination already exists: ${destPath}`);
+
+    // Verify neither file was overwritten or removed
+    const sourceContent = await fs.readFile(sourcePath, 'utf-8');
+    expect(sourceContent).toBe('original source content');
+
+    const destContent = await fs.readFile(destPath, 'utf-8');
+    expect(destContent).toBe('original destination content');
+  });
+
+  it('should fail when destination directory already exists', async () => {
+    const sourcePath = path.join(testDir, 'source.txt');
+    const destDir = path.join(testDir, 'dest_dir');
+    await fs.writeFile(sourcePath, 'original source content');
+    await fs.mkdir(destDir);
+
+    const result = await client.callTool({
+      name: 'move_file',
+      arguments: {
+        source: sourcePath,
+        destination: destDir,
+      },
+    });
+
+    expect(result.isError).toBe(true);
+    const content = result.content as Array<{ type: string; text: string }>;
+    expect(content[0].text).toContain(`Destination already exists: ${destDir}`);
+
+    // Verify source and dest_dir are intact
+    const sourceContent = await fs.readFile(sourcePath, 'utf-8');
+    expect(sourceContent).toBe('original source content');
+    const dirStat = await fs.stat(destDir);
+    expect(dirStat.isDirectory()).toBe(true);
+  });
+
+  it('should successfully move a directory when destination does not exist', async () => {
+    const sourceDir = path.join(testDir, 'source_folder');
+    const nestedFile = path.join(sourceDir, 'nested.txt');
+    const destDir = path.join(testDir, 'dest_folder');
+
+    await fs.mkdir(sourceDir);
+    await fs.writeFile(nestedFile, 'nested file content');
+
+    const result = await client.callTool({
+      name: 'move_file',
+      arguments: {
+        source: sourceDir,
+        destination: destDir,
+      },
+    });
+
+    expect(result.isError).toBeFalsy();
+    await expect(fs.stat(sourceDir)).rejects.toThrow();
+    const destNestedContent = await fs.readFile(path.join(destDir, 'nested.txt'), 'utf-8');
+    expect(destNestedContent).toBe('nested file content');
+  });
+});
diff --git a/src/filesystem/index.ts b/src/filesystem/index.ts
index 234605bb13..24c8a0ec98 100644
--- a/src/filesystem/index.ts
+++ b/src/filesystem/index.ts
@@ -631,6 +631,21 @@ server.registerTool(
   async (args: z.infer<typeof MoveFileArgsSchema>) => {
     const validSourcePath = await validatePath(args.source);
     const validDestPath = await validatePath(args.destination);
+
+    let destinationExists = false;
+    try {
+      await fs.stat(validDestPath);
+      destinationExists = true;
+    } catch (error: any) {
+      if (error.code !== "ENOENT") {
+        throw error;
+      }
+    }
+
+    if (destinationExists) {
+      throw new Error(`Destination already exists: ${args.destination}`);
+    }
+
     await fs.rename(validSourcePath, validDestPath);
     const text = `Successfully moved ${args.source} to ${args.destination}`;
     const contentBlock = { type: "text" as const, text };