diff --git a/components/lib/dropdown/Dropdown.js b/components/lib/dropdown/Dropdown.js
index dd8e53a298..f764cb5f13 100644
--- a/components/lib/dropdown/Dropdown.js
+++ b/components/lib/dropdown/Dropdown.js
@@ -695,6 +695,7 @@ export const Dropdown = React.memo(
             }
 
             updateEditableLabel();
+            setFocusedOptionIndex(-1);
         };
 
         const selectItem = (event) => {