Adding to @Timmy Jim's answer.
This issue affects older Windows operating systems as well, and won't go away until Valve adds HighDPI support to Steam.
Setting Display Scaling to 100% will fix Steam's problem, but in turn will affect every other app on your PC, regardless of whether they support HighDPI or not. Specifically, text and other UI elements will be rendered at an extremely small size, which can adversely affect your productivity.
The better solution is to tell Windows not to scale Steam, and only Steam (and any other app stuck in 2009 that doesn't support HighDPI). @Timmy Jim's alternate solution does just that, so you should try that instead of setting system-wide Display Scaling.
You can also add an exception to the registry. Simply copy the following code...
Windows Registry Editor Version 5.00
[HKEY_CURRENT_USER\Software\Microsoft\Windows NT\CurrentVersion\AppCompatFlags\Layers]
"C:\\Program Files (x86)\\Steam\\steam.exe"="HIGHDPIAWARE"
... into a regular text file and change the text file's extension from .txt
to .reg
, then double-click the file to execute it. You might need to accept and provide elevated privileges.
You might find that some games won't let you use your screen's native resolution, such as Borderlands 2. The reason for that is the same as with Steam, and the solution is the same.
The beauty about the registry solution, is that you can use it to quickly "fix" multiple apps on multiple PCs. Simply add all the paths you need in the registry file, like this:
Windows Registry Editor Version 5.00
[HKEY_CURRENT_USER\Software\Microsoft\Windows NT\CurrentVersion\AppCompatFlags\Layers]
"C:\\Program Files (x86)\\Steam\\steam.exe"="HIGHDPIAWARE"
"C:\\Program Files (x86)\\Steam\\SteamApps\\common\\Borderlands 2\\Binaries\\Win32\\Borderlands2.exe"="HIGHDPIAWARE"