diff --git a/packages/grafana-data/src/text/markdown.test.ts b/packages/grafana-data/src/text/markdown.test.ts
index b9e7052c3ef..20a5bab4611 100644
--- a/packages/grafana-data/src/text/markdown.test.ts
+++ b/packages/grafana-data/src/text/markdown.test.ts
@@ -1,5 +1,4 @@
-import { renderMarkdown } from './markdown';
-import { sanitizeTextPanelContent } from './sanitize';
+import { renderMarkdown, renderTextPanelMarkdown } from './markdown';
 
 describe('Markdown wrapper', () => {
   it('should be able to handle undefined value', () => {
@@ -12,12 +11,8 @@ describe('Markdown wrapper', () => {
     expect(str).toBe('<script>alert()</script>');
   });
 
-  it('should allow whitelisted styles in text panel', () => {
-    const html =
-      '<div style="display:flex; flex-direction: column; flex-wrap: wrap; justify-content: start; gap: 2px;"><div style="flex-basis: 50%"></div></div>';
-    const str = sanitizeTextPanelContent(html);
-    expect(str).toBe(
-      '<div style="display:flex; flex-direction:column; flex-wrap:wrap; justify-content:start; gap:2px;"><div style="flex-basis:50%;"></div></div>'
-    );
+  it('should sanitize content in text panel by default', () => {
+    const str = renderTextPanelMarkdown('<script>alert()</script>');
+    expect(str).toBe('&lt;script&gt;alert()&lt;/script&gt;');
   });
 });
diff --git a/packages/grafana-data/src/text/sanitize.test.ts b/packages/grafana-data/src/text/sanitize.test.ts
new file mode 100644
index 00000000000..8d9ff47d4d9
--- /dev/null
+++ b/packages/grafana-data/src/text/sanitize.test.ts
@@ -0,0 +1,12 @@
+import { sanitizeTextPanelContent } from './sanitize';
+
+describe('Sanitize wrapper', () => {
+  it('should allow whitelisted styles in text panel', () => {
+    const html =
+      '<div style="display:flex; flex-direction: column; flex-wrap: wrap; justify-content: start; gap: 2px;"><div style="flex-basis: 50%"></div></div>';
+    const str = sanitizeTextPanelContent(html);
+    expect(str).toBe(
+      '<div style="display:flex; flex-direction:column; flex-wrap:wrap; justify-content:start; gap:2px;"><div style="flex-basis:50%;"></div></div>'
+    );
+  });
+});
diff --git a/public/app/plugins/panel/text/TextPanel.test.tsx b/public/app/plugins/panel/text/TextPanel.test.tsx
new file mode 100644
index 00000000000..99a245dff33
--- /dev/null
+++ b/public/app/plugins/panel/text/TextPanel.test.tsx
@@ -0,0 +1,120 @@
+import { render, screen } from '@testing-library/react';
+import React from 'react';
+
+import { dateTime, LoadingState, EventBusSrv } from '@grafana/data';
+
+import { Props, TextPanel } from './TextPanel';
+import { TextMode } from './models.gen';
+
+const replaceVariablesMock = jest.fn();
+const defaultProps: Props = {
+  id: 1,
+  data: {
+    state: LoadingState.Done,
+    series: [
+      {
+        fields: [],
+        length: 0,
+      },
+    ],
+    timeRange: {
+      from: dateTime('2022-01-01T15:55:00Z'),
+      to: dateTime('2022-07-12T15:55:00Z'),
+      raw: {
+        from: 'now-15m',
+        to: 'now',
+      },
+    },
+  },
+  timeRange: {
+    from: dateTime('2022-07-11T15:55:00Z'),
+    to: dateTime('2022-07-12T15:55:00Z'),
+    raw: {
+      from: 'now-15m',
+      to: 'now',
+    },
+  },
+  timeZone: 'utc',
+  transparent: false,
+  width: 120,
+  height: 120,
+  fieldConfig: {
+    defaults: {},
+    overrides: [],
+  },
+  renderCounter: 1,
+  title: 'Test Text Panel',
+  eventBus: new EventBusSrv(),
+  options: { content: '', mode: TextMode.Markdown },
+  onOptionsChange: jest.fn(),
+  onFieldConfigChange: jest.fn(),
+  replaceVariables: replaceVariablesMock,
+  onChangeTimeRange: jest.fn(),
+};
+
+const setup = (props: Props = defaultProps) => {
+  render(<TextPanel {...props} />);
+};
+
+describe('TextPanel', () => {
+  it('should render panel without content', () => {
+    expect(() => setup()).not.toThrow();
+  });
+
+  it('sanitizes content in html mode', () => {
+    const contentTest = '<form><p>Form tags are sanitized.</p></form>\n<script>Script tags are sanitized.</script>';
+    replaceVariablesMock.mockReturnValueOnce(contentTest);
+    const props = Object.assign({}, defaultProps, {
+      options: { content: contentTest, mode: TextMode.HTML },
+    });
+
+    setup(props);
+
+    expect(screen.getByTestId('TextPanel-converted-content').innerHTML).toEqual(
+      '&lt;form&gt;<p>Form tags are sanitized.</p>&lt;/form&gt;\n&lt;script&gt;Script tags are sanitized.&lt;/script&gt;'
+    );
+  });
+
+  it('sanitizes content in markdown mode', () => {
+    const contentTest = '<form><p>Form tags are sanitized.</p></form>\n<script>Script tags are sanitized.</script>';
+    replaceVariablesMock.mockReturnValueOnce(contentTest);
+
+    const props = Object.assign({}, defaultProps, {
+      options: { content: contentTest, mode: TextMode.Markdown },
+    });
+
+    setup(props);
+
+    expect(screen.getByTestId('TextPanel-converted-content').innerHTML).toEqual(
+      '&lt;form&gt;<p>Form tags are sanitized.</p>&lt;/form&gt;\n&lt;script&gt;Script tags are sanitized.&lt;/script&gt;'
+    );
+  });
+
+  it('converts content to markdown when in markdown mode', async () => {
+    const contentTest = 'We begin by a simple sentence.\n```code block```';
+    replaceVariablesMock.mockReturnValueOnce(contentTest);
+
+    const props = Object.assign({}, defaultProps, {
+      options: { content: contentTest, mode: TextMode.Markdown },
+    });
+
+    setup(props);
+
+    const waited = await screen.getByTestId('TextPanel-converted-content');
+    expect(waited.innerHTML).toEqual('<p>We begin by a simple sentence.\n<code>code block</code></p>\n');
+  });
+
+  it('converts content to html when in html mode', () => {
+    const contentTest = 'We begin by a simple sentence.\n```This is a code block\n```';
+    replaceVariablesMock.mockReturnValueOnce(contentTest);
+    const props = Object.assign({}, defaultProps, {
+      options: { content: contentTest, mode: TextMode.HTML },
+    });
+
+    setup(props);
+
+    expect(screen.getByTestId('TextPanel-converted-content').innerHTML).toEqual(
+      'We begin by a simple sentence.\n```This is a code block\n```'
+    );
+  });
+});
diff --git a/public/app/plugins/panel/text/TextPanel.tsx b/public/app/plugins/panel/text/TextPanel.tsx
index c30ba779ec9..8494f3a76c8 100644
--- a/public/app/plugins/panel/text/TextPanel.tsx
+++ b/public/app/plugins/panel/text/TextPanel.tsx
@@ -12,7 +12,7 @@ import config from 'app/core/config';
 // Types
 import { PanelOptions, TextMode } from './models.gen';
 
-interface Props extends PanelProps<PanelOptions> {}
+export interface Props extends PanelProps<PanelOptions> {}
 
 interface State {
   html: string;
@@ -90,7 +90,11 @@ export class TextPanel extends PureComponent<Props, State> {
     const styles = getStyles();
     return (
       <CustomScrollbar autoHeightMin="100%">
-        <DangerouslySetHtmlContent html={html} className={cx('markdown-html', styles.content)} />
+        <DangerouslySetHtmlContent
+          html={html}
+          className={cx('markdown-html', styles.content)}
+          data-testid="TextPanel-converted-content"
+        />
       </CustomScrollbar>
     );
   }