diff --git a/packages/overlays/src/utils/contain-focus.js b/packages/overlays/src/utils/contain-focus.js
index fe218a64e..e670cb24c 100644
--- a/packages/overlays/src/utils/contain-focus.js
+++ b/packages/overlays/src/utils/contain-focus.js
@@ -132,13 +132,13 @@ export function containFocus(rootElement) {
   function disconnect() {
     window.removeEventListener('keydown', handleKeydown);
     window.removeEventListener('focusin', setFocusInRootElement);
-    window.removeEventListener('blur', addFocusinListener);
+    window.removeEventListener('focusout', addFocusinListener);
     rootElement.removeChild(tabDetectionElement);
     rootElement.style.removeProperty('outline');
   }
 
   window.addEventListener('keydown', handleKeydown);
-  window.addEventListener('blur', addFocusinListener);
+  window.addEventListener('focusout', addFocusinListener);
   createHelpersDetectingTabDirection();
 
   return { disconnect };
diff --git a/packages/overlays/test/OverlayController.test.js b/packages/overlays/test/OverlayController.test.js
index ffb5d97e5..8325ac890 100644
--- a/packages/overlays/test/OverlayController.test.js
+++ b/packages/overlays/test/OverlayController.test.js
@@ -358,7 +358,7 @@ describe('OverlayController', () => {
         const ctrl = new OverlayController({
           ...withGlobalTestConfig(),
           contentNode,
-          trapsKeyboardFocus: true,
+          trapsKeyboardFocus: false,
         });
         // add element to dom to allow focus
         /** @type {HTMLElement} */ (await fixture(html`${ctrl.content}`));