Google begins embedding ads directly inside AI Mode search responses

Google has started placing Gemini-generated advertisements directly inside the responses produced by its AI Mode search experience.

Ads now appear within expanded recommendations and curated lists, with the format currently being tested in the United States.

At the Google Marketing Live conference, the company unveiled a new generation of ad formats for AI Mode search, powered by Gemini. It marks the first time Google has placed advertising directly inside an AI-generated answer rather than alongside it. All advertisements are clearly labeled as Sponsored. Testing is currently limited to U.S. users on both desktop and mobile devices.

Four new ad formats have been introduced for AI Mode, with two standing out as the most significant. Conversational Discovery ads are designed to adapt to the specific query a user enters, with Gemini generating an advertisement tailored to the context of the question rather than matching it against fixed keywords. In one example shared by Google, a user asks how to make their home smell "like those fancy spas or a rainy forest," and an ad for a relevant product appears within the response. The second format, Highlighted Answers, inserts sponsored entries directly into AI-generated recommendation lists. A query about language learning apps, for instance, might return a curated list in which Duolingo appears alongside other options, clearly marked as an advertisement.

The defining feature of both formats is an independent AI explainer that sits alongside the sponsored content. Gemini provides its own commentary next to the advertiser's creative, evaluating the product or service and explaining why the option fits the user's query. Google is positioning the feature as a direct response to the obvious concern about conflicts of interest, namely whether AI recommendations can be trusted when they are paid for. In the coming months, advertising will also expand into the Shopping section. Users will be able to describe what they are looking for in detail, with Gemini surfacing options and explaining how sponsored suggestions match the specified parameters.

The move is logical but sensitive for Google itself. The AI Mode experience fundamentally changes the traditional search model, in which the company makes most of its money from advertising placed alongside blue links. Google is now attempting to migrate that monetization into the new format without losing revenue along the way. Notably, in January 2026, Google DeepMind CEO Demis Hassabis stated that the company had no plans to introduce advertising into the Gemini chatbot, in contrast to OpenAI's move to do so within ChatGPT. At the time, however, there was no mention of advertising in AI Mode search.