diff --git a/app/ui/lib/Combobox.tsx b/app/ui/lib/Combobox.tsx
index 31e2c9ae4..4904dfdc7 100644
--- a/app/ui/lib/Combobox.tsx
+++ b/app/ui/lib/Combobox.tsx
@@ -151,8 +151,12 @@ export const Combobox = ({
       value={selectedItemValue}
       // fallback to '' allows clearing field to work
       onChange={(val) => onChange(val || '')}
-      // we only want to keep the query on close when arbitrary values are allowed
-      onClose={allowArbitraryValues ? undefined : () => setQuery('')}
+      // We only want to keep the query on close when arbitrary values are allowed.
+      // Only clear the query if the document still has focus, meaning this was a
+      // deliberate close (clicked outside, pressed Escape, selected item). If the
+      // document lost focus (user switched tabs/windows), preserve the query so
+      // it's still there when they return.
+      onClose={allowArbitraryValues ? undefined : () => document.hasFocus() && setQuery('')}
       disabled={disabled || isLoading}
       immediate
       {...props}
diff --git a/test/e2e/combobox-focus.e2e.ts b/test/e2e/combobox-focus.e2e.ts
new file mode 100644
index 000000000..cb98353e5
--- /dev/null
+++ b/test/e2e/combobox-focus.e2e.ts
@@ -0,0 +1,68 @@
+/*
+ * This Source Code Form is subject to the terms of the Mozilla Public
+ * License, v. 2.0. If a copy of the MPL was not distributed with this
+ * file, you can obtain one at https://mozilla.org/MPL/2.0/.
+ *
+ * Copyright Oxide Computer Company
+ */
+import { expect, test } from './utils'
+
+test('combobox clears query when user clicks outside', async ({ page }) => {
+  await page.goto('/projects/mock-project/instances-new')
+
+  await expect(page.getByRole('heading', { name: /Create instance/ })).toBeVisible()
+
+  const combobox = page.getByPlaceholder('Select a silo image', { exact: true })
+  await combobox.click()
+  await combobox.fill('hel')
+
+  await expect(combobox).toHaveValue('hel')
+  await expect(page.getByRole('option').first()).toBeVisible()
+
+  // Click outside the combobox to close it
+  await page.getByRole('heading', { name: /Create instance/ }).click()
+
+  // The dropdown should close
+  await expect(page.getByRole('option').first()).toBeHidden()
+
+  // The query should be cleared since this was a deliberate close
+  await expect(combobox).toHaveValue('')
+})
+
+// Regression test for https://github.com/oxidecomputer/console/issues/3012
+test('combobox preserves query when document loses focus', async ({ page }) => {
+  await page.goto('/projects/mock-project/instances-new')
+
+  await expect(page.getByRole('heading', { name: /Create instance/ })).toBeVisible()
+
+  const combobox = page.getByPlaceholder('Select a silo image', { exact: true })
+  await combobox.click()
+  await combobox.fill('hel')
+
+  await expect(combobox).toHaveValue('hel')
+  await expect(page.getByRole('option').first()).toBeVisible()
+
+  // Simulate the document losing focus by mocking document.hasFocus() to return false
+  // during the blur, then restoring it. This simulates what happens when switching tabs.
+  await page.evaluate(() => {
+    const originalHasFocus = document.hasFocus.bind(document)
+    document.hasFocus = () => false
+
+    const input = document.querySelector(
+      'input[placeholder="Select a silo image"]'
+    ) as HTMLInputElement
+    if (input) {
+      input.blur()
+    }
+
+    // Restore after a tick to allow event handlers to fire
+    setTimeout(() => {
+      document.hasFocus = originalHasFocus
+    }, 50)
+  })
+
+  await page.waitForTimeout(100)
+
+  // The query should be preserved since the document lost focus (like switching tabs)
+  await expect(combobox).toHaveValue('hel')
+})