diff --git a/packages/desktop-client/src/components/autocomplete/Autocomplete.tsx b/packages/desktop-client/src/components/autocomplete/Autocomplete.tsx
index b4f581a91f..bc00693bb0 100644
--- a/packages/desktop-client/src/components/autocomplete/Autocomplete.tsx
+++ b/packages/desktop-client/src/components/autocomplete/Autocomplete.tsx
@@ -562,7 +562,7 @@ function SingleAutocomplete<T extends AutocompleteItem>({
                     if (e.key === 'Escape') {
                       e.nativeEvent['preventDownshiftDefault'] = true;
 
-                      if (!embedded) {
+                      if (!embedded && isOpen) {
                         e.stopPropagation();
                       }
 
diff --git a/packages/desktop-client/src/components/transactions/TransactionsTable.test.tsx b/packages/desktop-client/src/components/transactions/TransactionsTable.test.tsx
index 0cafd8af4c..0625f34eaf 100644
--- a/packages/desktop-client/src/components/transactions/TransactionsTable.test.tsx
+++ b/packages/desktop-client/src/components/transactions/TransactionsTable.test.tsx
@@ -928,18 +928,12 @@ describe('Transactions', () => {
     let input = expectToBeEditingField(container, 'date', 0, true);
     await userEvent.type(input, '[Tab]');
     input = expectToBeEditingField(container, 'account', 0, true);
-    // The first escape closes the dropdown
+
+    await userEvent.type(input, '[Escape]');
     await userEvent.type(input, '[Escape]');
     expect(
       container.querySelector('[data-testid="new-transaction"]'),
-    ).toBeTruthy();
-
-    // TODO: Fix this
-    // Now it should close the new transaction form
-    // await userEvent.type(input, '[Escape]');
-    // expect(
-    //   container.querySelector('[data-testid="new-transaction"]')
-    // ).toBeNull();
+    ).toBeNull();
 
     // The cancel button should also close the new transaction form
     updateProps({ isAdding: true });
diff --git a/upcoming-release-notes/6570.md b/upcoming-release-notes/6570.md
new file mode 100644
index 0000000000..ef497a9987
--- /dev/null
+++ b/upcoming-release-notes/6570.md
@@ -0,0 +1,6 @@
+---
+category: Bugfix
+authors: [skliaruk]
+---
+
+Closes the popover on second Escape press once autocomplete options are closed.