diff --git a/src/pytest_html/basereport.py b/src/pytest_html/basereport.py
index cfcc74b2..a27bf143 100644
--- a/src/pytest_html/basereport.py
+++ b/src/pytest_html/basereport.py
@@ -42,12 +42,20 @@ def css(self):
         return
 
     def _asset_filename(self, test_id, extra_index, test_index, file_extension):
-        return "{}_{}_{}.{}".format(
+        filename = "{}_{}_{}.{}".format(
             re.sub(r"[^\w.]", "_", test_id),
             str(extra_index),
             str(test_index),
             file_extension,
-        )[-self._max_asset_filename_length :]
+        )
+        max_length = self._max_asset_filename_length
+        assets_dir = getattr(self, "_assets_path", None)
+        if assets_dir is not None:
+            # Files are written under this directory (see Report._write_content).
+            # Reserve the directory name plus separator so the relative path
+            # stays within max_asset_filename_length on path-limited systems.
+            max_length -= len(assets_dir.name) + 1
+        return filename[-max(1, max_length) :]
 
     def _generate_report(self, self_contained=False):
         generated = datetime.datetime.now()
diff --git a/testing/legacy_test_pytest_html.py b/testing/legacy_test_pytest_html.py
index 08ad208d..f2fe3db4 100644
--- a/testing/legacy_test_pytest_html.py
+++ b/testing/legacy_test_pytest_html.py
@@ -681,8 +681,9 @@ def {test_name}():
         """
         )
         result, html = run(testdir, "report.html")
+        truncated_length = max(1, max_asset_filename_length - len("assets/"))
         file_name = f"test_very_long_test_name.py__{test_name}_0_0.png"[
-            -max_asset_filename_length:
+            -truncated_length:
         ]
         src = "assets/" + file_name
         link = f'<a class="image" href="{src}" target="_blank">'
diff --git a/testing/test_unit.py b/testing/test_unit.py
index 1ea945ea..eaef969c 100644
--- a/testing/test_unit.py
+++ b/testing/test_unit.py
@@ -5,6 +5,8 @@
 import pytest
 from assertpy import assert_that
 
+from pytest_html.basereport import BaseReport
+
 pytest_plugins = ("pytester",)
 
 
@@ -146,3 +148,24 @@ def test_custom_css_selfcontained(pytester, css_file_path, expandvar):
     with open(pytester.path / "report.html") as f:
         html = f.read()
         assert_that(html).contains("* " + str(css_file_path)).contains("* two.css")
+
+
+def test_asset_filename_accounts_for_assets_directory_prefix():
+    """Relative asset paths must stay within max_asset_filename_length (#906)."""
+
+    class _Report:
+        _max_asset_filename_length = 255
+        _assets_path = Path("report_dir") / "assets"
+
+    filename = BaseReport._asset_filename(
+        _Report(),
+        "test_" + "a" * 300,
+        extra_index=0,
+        test_index=0,
+        file_extension="png",
+    )
+    relative_path = str(Path("assets") / filename).replace("\\", "/")
+    assert_that(len(filename)).is_less_than_or_equal_to(255 - len("assets/"))
+    assert_that(len(relative_path)).is_less_than_or_equal_to(255)
+    assert_that(relative_path).starts_with("assets/")
+    assert_that(filename).ends_with(".png")