diff --git a/CHANGES.rst b/CHANGES.rst
index bac63847d..9283e4157 100644
--- a/CHANGES.rst
+++ b/CHANGES.rst
@@ -4,7 +4,7 @@
 The ASDF Standard is at v1.6.0
 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
 
--
+- Fix bug in ``asdftool diff`` for arrays within a list [#1672]
 
 3.0.0 (2023-10-16)
 ------------------
diff --git a/asdf/_tests/commands/tests/data/blocks.diff b/asdf/_tests/commands/tests/data/blocks.diff
index 9f04a8167..da3edd2df 100644
--- a/asdf/_tests/commands/tests/data/blocks.diff
+++ b/asdf/_tests/commands/tests/data/blocks.diff
@@ -10,4 +10,5 @@ tree:
       -
 >       9000
 <       10000
-    ndarrays at "foobar" differ by shape, datatype and contents
+>   ndarrays differ by shape, datatype and contents
+<   ndarrays differ by shape, datatype and contents
diff --git a/asdf/_tests/commands/tests/data/ndarray_in_list.diff b/asdf/_tests/commands/tests/data/ndarray_in_list.diff
new file mode 100644
index 000000000..3a58bce13
--- /dev/null
+++ b/asdf/_tests/commands/tests/data/ndarray_in_list.diff
@@ -0,0 +1,9 @@
+< tree:
+< list:
+<   - a:
+<       offset:
+<         16
+<       strides:
+<         - -8
+>       ndarrays differ by contents
+<       ndarrays differ by contents
diff --git a/asdf/_tests/commands/tests/data/ndarray_in_list0.asdf b/asdf/_tests/commands/tests/data/ndarray_in_list0.asdf
new file mode 100644
index 000000000..0b2e1925a
Binary files /dev/null and b/asdf/_tests/commands/tests/data/ndarray_in_list0.asdf differ
diff --git a/asdf/_tests/commands/tests/data/ndarray_in_list1.asdf b/asdf/_tests/commands/tests/data/ndarray_in_list1.asdf
new file mode 100644
index 000000000..90b03ace7
Binary files /dev/null and b/asdf/_tests/commands/tests/data/ndarray_in_list1.asdf differ
diff --git a/asdf/_tests/commands/tests/data/ndarrays.diff b/asdf/_tests/commands/tests/data/ndarrays.diff
index 5e400cacb..e64165b96 100644
--- a/asdf/_tests/commands/tests/data/ndarrays.diff
+++ b/asdf/_tests/commands/tests/data/ndarrays.diff
@@ -1 +1,4 @@
-    ndarrays at "a" differ by contents
+tree:
+  a:
+>   ndarrays differ by contents
+<   ndarrays differ by contents
diff --git a/asdf/_tests/commands/tests/data/simple_inline_array.diff b/asdf/_tests/commands/tests/data/simple_inline_array.diff
index 3e30e30c1..8a423c5fd 100644
--- a/asdf/_tests/commands/tests/data/simple_inline_array.diff
+++ b/asdf/_tests/commands/tests/data/simple_inline_array.diff
@@ -1 +1,4 @@
-    ndarrays at "array" differ by contents
+tree:
+  array:
+>   ndarrays differ by contents
+<   ndarrays differ by contents
diff --git a/asdf/_tests/commands/tests/test_diff.py b/asdf/_tests/commands/tests/test_diff.py
index d96eb6849..45df7d036 100644
--- a/asdf/_tests/commands/tests/test_diff.py
+++ b/asdf/_tests/commands/tests/test_diff.py
@@ -54,6 +54,12 @@ def test_diff_ndarray():
     _assert_diffs_equal(filenames, result_file, minimal=False)
 
 
+def test_diff_ndarray_in_list():
+    filenames = ["ndarray_in_list0.asdf", "ndarray_in_list1.asdf"]
+    result_file = "ndarray_in_list.diff"
+    _assert_diffs_equal(filenames, result_file, minimal=False)
+
+
 def test_diff_block():
     filenames = ["block0.asdf", "block1.asdf"]
     result_file = "blocks.diff"
diff --git a/asdf/commands/diff.py b/asdf/commands/diff.py
index fa8776ad7..7c682fa74 100644
--- a/asdf/commands/diff.py
+++ b/asdf/commands/diff.py
@@ -104,8 +104,9 @@ class ArrayNode:
     of but not necessarily display. This allows the diff output to be
     cleaner."""
 
-    def __init__(self, name):
+    def __init__(self, name, index):
         self.name = name
+        self.index = index
 
     def __hash__(self):
         return hash(self.name)
@@ -191,7 +192,7 @@ def print_in_tree(diff_ctx, node_list, thing, other, use_marker=False, last_was_
     # If tree element is list, recursively print list contents
     if isinstance(thing, list):
         for i, subthing in enumerate(thing):
-            key = ArrayNode(f"{node_list[-1]}_{i}")
+            key = ArrayNode(f"{node_list[-1]}_{i}", i)
             last_was_list = print_in_tree(
                 diff_ctx,
                 [*node_list, key],
@@ -277,9 +278,9 @@ def compare_ndarrays(diff_ctx, array0, array1, keys):
         differences.append("contents")
 
     if differences:
-        prefix = "  " * (len(keys) + 1)
-        msg = f"ndarrays at \"{'.'.join(keys)}\" differ by {human_list(differences)}"
-        diff_ctx.iostream.write(prefix + RED + msg + RESET_NEWLINE)
+        msg = f"ndarrays differ by {human_list(differences)}"
+        print_in_tree(diff_ctx, keys, msg, False, ignore_lwl=True)
+        print_in_tree(diff_ctx, keys, msg, True, ignore_lwl=True)
 
 
 def both_are_ndarrays(tree0, tree1):
@@ -321,7 +322,7 @@ def compare_trees(diff_ctx, tree0, tree1, keys=None):
         compare_dicts(diff_ctx, tree0, tree1, keys)
     elif isinstance(tree0, list) and isinstance(tree1, list):
         for i, (obj0, obj1) in enumerate(zip(tree0, tree1)):
-            key = ArrayNode(f"item_{i}")
+            key = ArrayNode(f"item_{i}", i)
             compare_trees(diff_ctx, obj0, obj1, [*keys, key])
     else:
         compare_objects(diff_ctx, tree0, tree1, keys)