diff --git a/web-app/src/containers/ModelCombobox.tsx b/web-app/src/containers/ModelCombobox.tsx
index 7bd6672e7..9b8144ed3 100644
--- a/web-app/src/containers/ModelCombobox.tsx
+++ b/web-app/src/containers/ModelCombobox.tsx
@@ -182,8 +182,9 @@ function useKeyboardNavigation(
           onModelSelect(filteredModels[highlightedIndex])
         }
         break
-      case 'ArrowRight':
-      case 'ArrowLeft':
+      case 'Escape':
+        e.preventDefault()
+        e.stopPropagation()
         setOpen(false)
         setHighlightedIndex(-1)
         break
@@ -195,11 +196,6 @@ function useKeyboardNavigation(
         e.preventDefault()
         setHighlightedIndex(filteredModels.length - 1)
         break
-      case 'Escape':
-        e.preventDefault()
-        setOpen(false)
-        setHighlightedIndex(-1)
-        break
     }
   }, [open, setOpen, models.length, filteredModels, highlightedIndex, setHighlightedIndex, onModelSelect])
 
@@ -216,6 +212,7 @@ type ModelComboboxProps = {
   placeholder?: string
   disabled?: boolean
   className?: string
+  onOpenChange?: (open: boolean) => void
 }
 
 export function ModelCombobox({
@@ -228,6 +225,7 @@ export function ModelCombobox({
   placeholder = 'Type or select a model...',
   disabled = false,
   className,
+  onOpenChange,
 }: ModelComboboxProps) {
   const [open, setOpen] = useState(false)
   const [inputValue, setInputValue] = useState(value)
@@ -242,6 +240,11 @@ export function ModelCombobox({
     setInputValue(value)
   }, [value])
 
+  // Notify parent when open state changes
+  useEffect(() => {
+    onOpenChange?.(open)
+  }, [open, onOpenChange])
+
   // Hook for the dropdown position
   const { dropdownPosition } = useDropdownPosition(open, containerRef)
 
diff --git a/web-app/src/containers/__tests__/ModelCombobox.test.tsx b/web-app/src/containers/__tests__/ModelCombobox.test.tsx
index 1b91c3712..38f9b97c8 100644
--- a/web-app/src/containers/__tests__/ModelCombobox.test.tsx
+++ b/web-app/src/containers/__tests__/ModelCombobox.test.tsx
@@ -487,28 +487,4 @@ describe('ModelCombobox', () => {
 
     expect(localMockOnChange).toHaveBeenCalledWith('gpt-3.5-turbo')
   })
-
-  it('closes dropdown with ArrowLeft key', async () => {
-    const user = userEvent.setup()
-    render(<ModelCombobox {...defaultProps} />)
-
-    const input = screen.getByRole('textbox')
-    input.focus()
-    
-    // ArrowDown should open dropdown
-    await user.keyboard('{ArrowDown}')
-    
-    await waitFor(() => {
-      const dropdown = document.querySelector('[data-dropdown="model-combobox"]')
-      expect(dropdown).toBeInTheDocument()
-    })
-    
-    // ArrowLeft should close dropdown
-    await user.keyboard('{ArrowLeft}')
-    
-    await waitFor(() => {
-      const dropdown = document.querySelector('[data-dropdown="model-combobox"]')
-      expect(dropdown).not.toBeInTheDocument()
-    })
-  })
 })
diff --git a/web-app/src/containers/dialogs/AddModel.tsx b/web-app/src/containers/dialogs/AddModel.tsx
index dc0eac244..a633867f6 100644
--- a/web-app/src/containers/dialogs/AddModel.tsx
+++ b/web-app/src/containers/dialogs/AddModel.tsx
@@ -26,6 +26,7 @@ export const DialogAddModel = ({ provider, trigger }: DialogAddModelProps) => {
   const { updateProvider } = useModelProvider()
   const [modelId, setModelId] = useState<string>('')
   const [open, setOpen] = useState(false)
+  const [isComboboxOpen, setIsComboboxOpen] = useState(false)
 
   // Fetch models from provider API (API key is optional)
   const { models, loading, error, refetch } = useProviderModels(
@@ -68,7 +69,13 @@ export const DialogAddModel = ({ provider, trigger }: DialogAddModelProps) => {
           </div>
         )}
       </DialogTrigger>
-      <DialogContent>
+      <DialogContent
+        onEscapeKeyDown={(e: KeyboardEvent) => {
+          if (isComboboxOpen) {
+            e.preventDefault()
+          }
+        }}
+      >
         <DialogHeader>
           <DialogTitle>{t('providers:addModel.title')}</DialogTitle>
           <DialogDescription>
@@ -95,6 +102,7 @@ export const DialogAddModel = ({ provider, trigger }: DialogAddModelProps) => {
             error={error}
             onRefresh={refetch}
             placeholder={t('providers:addModel.enterModelId')}
+            onOpenChange={setIsComboboxOpen}
           />
         </div>