diff --git a/.changeset/funny-eggs-sell.md b/.changeset/funny-eggs-sell.md
new file mode 100644
index 00000000000..456094822b7
--- /dev/null
+++ b/.changeset/funny-eggs-sell.md
@@ -0,0 +1,6 @@
+---
+'@spectrum-web-components/overlay': patch
+'@spectrum-web-components/core': patch
+---
+
+hover overlays should close with the Esc key when trigger is not focused
diff --git a/1st-gen/packages/overlay/src/OverlayStack.ts b/1st-gen/packages/overlay/src/OverlayStack.ts
index cc5c8ffd99b..a4f55ec8fc0 100644
--- a/1st-gen/packages/overlay/src/OverlayStack.ts
+++ b/1st-gen/packages/overlay/src/OverlayStack.ts
@@ -176,6 +176,13 @@ class OverlayStack {
         if (event.code !== 'Escape') return;
         if (!this.stack.length) return;
         const last = this.stack[this.stack.length - 1];
+        if (last?.type === 'hint') {
+            // Close hint/tooltip overlays on "Escape" key and prevent further handling of the event.
+            event.preventDefault();
+            event.stopPropagation();
+            this.closeOverlay(last);
+            return;
+        }
         if (last?.type === 'page') {
             event.preventDefault();
             return;
diff --git a/1st-gen/packages/overlay/test/index.ts b/1st-gen/packages/overlay/test/index.ts
index 8f2d39c82b3..5f719361b90 100644
--- a/1st-gen/packages/overlay/test/index.ts
+++ b/1st-gen/packages/overlay/test/index.ts
@@ -624,6 +624,32 @@ export const runOverlayTriggerTests = (type: string): void => {
                 ).to.be.false;
             });
 
+            it('Escape key closes a hover popover', async function () {
+                expect(await isOnTopLayer(this.hoverContent)).to.be.false;
+
+                const rect = this.outerTrigger.getBoundingClientRect();
+                const open = oneEvent(this.outerTrigger, 'sp-opened');
+                await sendMouse({
+                    type: 'move',
+                    position: [
+                        rect.left + rect.width / 2,
+                        rect.top + rect.height / 2,
+                    ],
+                });
+                await open;
+                const close = oneEvent(this.outerTrigger, 'sp-closed');
+                expect(
+                    await isOnTopLayer(this.hoverContent),
+                    'hover content is available at point'
+                ).to.be.true;
+                await sendKeys({ press: 'Escape' });
+                await close;
+                expect(
+                    await isOnTopLayer(this.hoverContent),
+                    'hover content is not available at point'
+                ).to.be.false;
+            });
+
             it('dispatches events on open/close', async function () {
                 const opened = oneEvent(this.outerButton, 'sp-opened');
                 this.outerButton.click();
diff --git a/1st-gen/packages/overlay/test/overlay-trigger-hover.test.ts b/1st-gen/packages/overlay/test/overlay-trigger-hover.test.ts
index 02c6d4e2961..a926f5eef5b 100644
--- a/1st-gen/packages/overlay/test/overlay-trigger-hover.test.ts
+++ b/1st-gen/packages/overlay/test/overlay-trigger-hover.test.ts
@@ -140,13 +140,14 @@ describe('Overlay Trigger - Hover', () => {
             );
             await elementUpdated(tooltip);
 
-            button.dispatchEvent(
+            tooltip.dispatchEvent(
                 new MouseEvent('pointerenter', {
                     bubbles: true,
                     composed: true,
                 })
             );
             await elementUpdated(tooltip);
+            expect(tooltip.open).to.be.true;
 
             tooltip.dispatchEvent(
                 new MouseEvent('pointerleave', {
@@ -210,6 +211,36 @@ describe('Overlay Trigger - Hover', () => {
 
             expect(el.open).to.be.undefined;
         });
+        it('closes the "tooltip" on "escape" keydown', async () => {
+            // Open the tooltip
+            const opened = oneEvent(button, 'sp-opened');
+            button.dispatchEvent(
+                new MouseEvent('pointerenter', {
+                    bubbles: true,
+                    composed: true,
+                })
+            );
+            await waitUntil(
+                () => tooltip.open === true,
+                'tooltip should open',
+                { timeout: 500 }
+            );
+            await opened;
+            expect(el.open).to.equal('hover');
+
+            // Test escape key closes tooltip when focus is not on trigger
+            const body = el.ownerDocument.body;
+            body.focus();
+            const closed = oneEvent(button, 'sp-closed');
+            const escapeKeydown = new KeyboardEvent('keydown', {
+                code: 'Escape',
+                bubbles: true,
+                composed: true,
+            });
+            body.dispatchEvent(escapeKeydown);
+            await closed;
+            expect(el.open).to.be.undefined;
+        });
     });
     it('persists hover content', async () => {
         const el = await fixture<OverlayTrigger>(
diff --git a/2nd-gen/packages/core/shared/base/version.ts b/2nd-gen/packages/core/shared/base/version.ts
index 622cc87119d..cb9e28ff658 100644
--- a/2nd-gen/packages/core/shared/base/version.ts
+++ b/2nd-gen/packages/core/shared/base/version.ts
@@ -1,2 +1,14 @@
+/**
+ * Copyright 2025 Adobe. All rights reserved.
+ * This file is licensed to you under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License. You may obtain a copy
+ * of the License at http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software distributed under
+ * the License is distributed on an "AS IS" BASIS, WITHOUT WARRANTIES OR REPRESENTATIONS
+ * OF ANY KIND, either express or implied. See the License for the specific language
+ * governing permissions and limitations under the License.
+ */
+
 // Generated by genversion.
 export const version = '1.10.0';