diff --git a/src/Optimizer/FuncCallOptimizer.php b/src/Optimizer/FuncCallOptimizer.php
index 26ebaf58..f83f4653 100644
--- a/src/Optimizer/FuncCallOptimizer.php
+++ b/src/Optimizer/FuncCallOptimizer.php
@@ -1421,17 +1421,26 @@ trait FuncCallOptimizer
         }
         $funcName = $expr->args[0]->value;
         if ($this->isScalarString($funcName)) {
-            $nameLower = strtolower(trim($funcName->value, '\\'));
-            $nativeFunction = $this->findNativeFunction($nameLower);
-            if ($nativeFunction) {
-                // A function whose ABI contains Native pointers is callable
-                // only from generated TypePHP C++. It has no Zend wrapper and
-                // therefore must remain invisible to function_exists().
-                return $this->functionRequiresNativeAbi($this->getFunction($nativeFunction))
-                    ? 'false'
-                    : 'true';
+            // Runtime function names are absolute, case-insensitive strings.
+            // PHP accepts one leading slash, but neither namespace/import
+            // resolution nor trimming other slashes applies to these names.
+            $nameLower = strtolower($funcName->value);
+            if (str_starts_with($nameLower, '\\')) {
+                $nameLower = substr($nameLower, 1);
             }
-            $funcName = $this->getLiteralString($nameLower);
+            $nativeFunction = $this->escapeNamespace($nameLower);
+            $this->checkFunction($nativeFunction);
+            if ($this->hasFunction($nativeFunction)) {
+                $function = $this->getFunction($nativeFunction);
+                // Escaped C++ names are not an exact PHP-name lookup: a
+                // namespace separator and literal underscores can collide.
+                if (!$function->method && strtolower($function->getNamespacedName()) === $nameLower) {
+                    // Native-pointer ABIs have no Zend wrapper and must
+                    // remain invisible to function_exists().
+                    return $this->functionRequiresNativeAbi($function) ? 'false' : 'true';
+                }
+            }
+            $funcName = $this->getLiteralString($funcName->value);
             return 'php::fn::function_exists(' . $funcName . ')';
         }
         return 'php::fn::function_exists(' . $this->parseIdentifier($funcName) . ')';
diff --git a/tests/compiler/stdlib/function-exists-literal-names.phpt b/tests/compiler/stdlib/function-exists-literal-names.phpt
new file mode 100644
index 00000000..b39ad136
--- /dev/null
+++ b/tests/compiler/stdlib/function-exists-literal-names.phpt
@@ -0,0 +1,68 @@
+--TEST--
+function_exists literal names follow runtime lookup rather than source call resolution
+--FILE--
+<?php
+namespace ExistsLibrary {
+    function target(): void {}
+}
+
+namespace ExistsScope {
+    use function ExistsLibrary\target as imported_target;
+    use ExistsLibrary as LibraryAlias;
+
+    function local_target(): void {}
+
+    function check(): void
+    {
+        echo json_encode([
+            function_exists('local_target'),
+            function_exists('imported_target'),
+            function_exists('LibraryAlias\\target'),
+            function_exists('ExistsLibrary\\target'),
+            function_exists('\\ExistsLibrary\\target'),
+            function_exists('ExistsScope\\local_target'),
+        ]), "\n";
+    }
+}
+
+namespace {
+    function literal_target(): void {}
+
+    function main(): void
+    {
+        echo json_encode([
+            function_exists('literal_target'),
+            function_exists('LITERAL_TARGET'),
+            function_exists('\\literal_target'),
+            function_exists('\\\\literal_target'),
+            function_exists('literal_target\\'),
+            function_exists('\\literal_target\\'),
+        ]), "\n";
+        echo json_encode([
+            function_exists('strlen'),
+            function_exists('STRLEN'),
+            function_exists('\\strlen'),
+            function_exists('\\\\strlen'),
+            function_exists('strlen\\'),
+            function_exists('\\strlen\\'),
+        ]), "\n";
+        echo json_encode([
+            function_exists('ExistsLibrary\\target'),
+            function_exists('EXISTSLIBRARY\\TARGET'),
+            function_exists('\\ExistsLibrary\\target'),
+            function_exists('\\\\ExistsLibrary\\target'),
+            function_exists('ExistsLibrary\\target\\'),
+            function_exists('ExistsLibrary_target'),
+            function_exists('ExistsLibrary__target'),
+            function_exists(''),
+            function_exists('\\'),
+        ]), "\n";
+        ExistsScope\check();
+    }
+}
+?>
+--EXPECT--
+[true,true,true,false,false,false]
+[true,true,true,false,false,false]
+[true,true,true,false,false,false,false,false,false]
+[false,false,false,true,true,true]