diff --git a/tools/server/public/index.html.gz b/tools/server/public/index.html.gz
index cd3528d3b2e49..4f18a634ce545 100644
Binary files a/tools/server/public/index.html.gz and b/tools/server/public/index.html.gz differ
diff --git a/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebar.svelte b/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebar.svelte
index 8dd4b20dcbb97..5976e5dd03d7b 100644
--- a/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebar.svelte
+++ b/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebar.svelte
@@ -1,9 +1,12 @@
 <script lang="ts">
 	import { goto } from '$app/navigation';
 	import { page } from '$app/state';
-	import { ChatSidebarConversationItem } from '$lib/components/app';
+	import { Trash2 } from '@lucide/svelte';
+	import { ChatSidebarConversationItem, ConfirmationDialog } from '$lib/components/app';
 	import ScrollArea from '$lib/components/ui/scroll-area/scroll-area.svelte';
 	import * as Sidebar from '$lib/components/ui/sidebar';
+	import * as AlertDialog from '$lib/components/ui/alert-dialog';
+	import Input from '$lib/components/ui/input/input.svelte';
 	import {
 		conversations,
 		deleteConversation,
@@ -16,6 +19,10 @@
 	let currentChatId = $derived(page.params.id);
 	let isSearchModeActive = $state(false);
 	let searchQuery = $state('');
+	let showDeleteDialog = $state(false);
+	let showEditDialog = $state(false);
+	let selectedConversation = $state<DatabaseConversation | null>(null);
+	let editedName = $state('');
 
 	let filteredConversations = $derived.by(() => {
 		if (searchQuery.trim().length > 0) {
@@ -27,12 +34,41 @@
 		return conversations();
 	});
 
-	async function editConversation(id: string, name: string) {
-		await updateConversationName(id, name);
+	async function handleDeleteConversation(id: string) {
+		const conversation = conversations().find((conv) => conv.id === id);
+		if (conversation) {
+			selectedConversation = conversation;
+			showDeleteDialog = true;
+		}
 	}
 
-	async function handleDeleteConversation(id: string) {
-		await deleteConversation(id);
+	async function handleEditConversation(id: string) {
+		const conversation = conversations().find((conv) => conv.id === id);
+		if (conversation) {
+			selectedConversation = conversation;
+			editedName = conversation.name;
+			showEditDialog = true;
+		}
+	}
+
+	function handleConfirmDelete() {
+		if (selectedConversation) {
+			showDeleteDialog = false;
+
+			setTimeout(() => {
+				deleteConversation(selectedConversation.id);
+				selectedConversation = null;
+			}, 100); // Wait for animation to finish
+		}
+	}
+
+	function handleConfirmEdit() {
+		if (!editedName.trim() || !selectedConversation) return;
+
+		showEditDialog = false;
+
+		updateConversationName(selectedConversation.id, editedName);
+		selectedConversation = null;
 	}
 
 	export function handleMobileSidebarItemClick() {
@@ -98,7 +134,7 @@
 							{handleMobileSidebarItemClick}
 							isActive={currentChatId === conversation.id}
 							onSelect={selectConversation}
-							onEdit={editConversation}
+							onEdit={handleEditConversation}
 							onDelete={handleDeleteConversation}
 						/>
 					</Sidebar.MenuItem>
@@ -119,7 +155,53 @@
 		</Sidebar.GroupContent>
 	</Sidebar.Group>
 
-	<div class="bottom-0 z-10 bg-sidebar bg-sidebar/50 px-4 py-4 backdrop-blur-lg md:sticky">
-		<p class="text-xs text-muted-foreground">Conversations are stored locally in your browser.</p>
-	</div>
+	<div class="bottom-0 z-10 bg-sidebar bg-sidebar/50 px-4 py-4 backdrop-blur-lg md:sticky"></div>
 </ScrollArea>
+
+<ConfirmationDialog
+	bind:open={showDeleteDialog}
+	title="Delete Conversation"
+	description={selectedConversation
+		? `Are you sure you want to delete "${selectedConversation.name}"? This action cannot be undone and will permanently remove all messages in this conversation.`
+		: ''}
+	confirmText="Delete"
+	cancelText="Cancel"
+	variant="destructive"
+	icon={Trash2}
+	onConfirm={handleConfirmDelete}
+	onCancel={() => {
+		showDeleteDialog = false;
+		selectedConversation = null;
+	}}
+/>
+
+<AlertDialog.Root bind:open={showEditDialog}>
+	<AlertDialog.Content>
+		<AlertDialog.Header>
+			<AlertDialog.Title>Edit Conversation Name</AlertDialog.Title>
+			<AlertDialog.Description>
+				<Input
+					class="mt-4 text-foreground"
+					onkeydown={(e) => {
+						if (e.key === 'Enter') {
+							e.preventDefault();
+							handleConfirmEdit();
+						}
+					}}
+					placeholder="Enter a new name"
+					type="text"
+					bind:value={editedName}
+				/>
+			</AlertDialog.Description>
+		</AlertDialog.Header>
+		<AlertDialog.Footer>
+			<AlertDialog.Cancel
+				onclick={() => {
+					showEditDialog = false;
+					selectedConversation = null;
+				}}>Cancel</AlertDialog.Cancel
+			>
+			<AlertDialog.Action onclick={handleConfirmEdit}>Save</AlertDialog.Action>
+		</AlertDialog.Footer>
+	</AlertDialog.Content>
+</AlertDialog.Root>
diff --git a/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebarConversationItem.svelte b/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebarConversationItem.svelte
index 6c3fb5764eb95..579d00aabc14a 100644
--- a/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebarConversationItem.svelte
+++ b/tools/server/webui/src/lib/components/app/chat/ChatSidebar/ChatSidebarConversationItem.svelte
@@ -1,8 +1,6 @@
 <script lang="ts">
 	import { Trash2, Pencil, MoreHorizontal } from '@lucide/svelte';
-	import { ActionDropdown, ConfirmationDialog } from '$lib/components/app';
-	import * as AlertDialog from '$lib/components/ui/alert-dialog';
-	import Input from '$lib/components/ui/input/input.svelte';
+	import { ActionDropdown } from '$lib/components/app';
 	import { onMount } from 'svelte';
 
 	interface Props {
@@ -10,9 +8,8 @@
 		conversation: DatabaseConversation;
 		handleMobileSidebarItemClick?: () => void;
 		onDelete?: (id: string) => void;
-		onEdit?: (id: string, name: string) => void;
+		onEdit?: (id: string) => void;
 		onSelect?: (id: string) => void;
-		showLastModified?: boolean;
 	}
 
 	let {
@@ -21,54 +18,48 @@
 		onDelete,
 		onEdit,
 		onSelect,
-		isActive = false,
-		showLastModified = false
+		isActive = false
 	}: Props = $props();
 
-	let editedName = $state('');
-	let showDeleteDialog = $state(false);
-	let showDropdown = $state(false);
-	let showEditDialog = $state(false);
-
-	function formatLastModified(timestamp: number) {
-		const now = Date.now();
-		const diff = now - timestamp;
-		const minutes = Math.floor(diff / (1000 * 60));
-		const hours = Math.floor(diff / (1000 * 60 * 60));
-		const days = Math.floor(diff / (1000 * 60 * 60 * 24));
-
-		if (minutes < 1) return 'Just now';
-		if (minutes < 60) return `${minutes}m ago`;
-		if (hours < 24) return `${hours}h ago`;
-		return `${days}d ago`;
+	let renderActionsDropdown = $state(false);
+	let dropdownOpen = $state(false);
+
+	function handleEdit(event: Event) {
+		event.stopPropagation();
+		onEdit?.(conversation.id);
 	}
 
-	function handleConfirmDelete() {
+	function handleDelete(event: Event) {
+		event.stopPropagation();
 		onDelete?.(conversation.id);
 	}
 
-	function handleConfirmEdit() {
-		if (!editedName.trim()) return;
-		showEditDialog = false;
-		onEdit?.(conversation.id, editedName);
+	function handleGlobalEditEvent(event: Event) {
+		const customEvent = event as CustomEvent<{ conversationId: string }>;
+		if (customEvent.detail.conversationId === conversation.id && isActive) {
+			handleEdit(event);
+		}
 	}
 
-	function handleEdit(event: Event) {
-		event.stopPropagation();
-		editedName = conversation.name;
-		showEditDialog = true;
+	function handleMouseLeave() {
+		if (!dropdownOpen) {
+			renderActionsDropdown = false;
+		}
+	}
+
+	function handleMouseOver() {
+		renderActionsDropdown = true;
 	}
 
 	function handleSelect() {
 		onSelect?.(conversation.id);
 	}
 
-	function handleGlobalEditEvent(event: Event) {
-		const customEvent = event as CustomEvent<{ conversationId: string }>;
-		if (customEvent.detail.conversationId === conversation.id && isActive) {
-			handleEdit(event);
+	$effect(() => {
+		if (!dropdownOpen) {
+			renderActionsDropdown = false;
 		}
-	}
+	});
 
 	onMount(() => {
 		document.addEventListener('edit-active-conversation', handleGlobalEditEvent as EventListener);
@@ -82,99 +73,46 @@
 	});
 </script>
 
+<!-- svelte-ignore a11y_mouse_events_have_key_events -->
 <button
-	class="group flex w-full cursor-pointer items-center justify-between space-x-3 rounded-lg px-3 py-1.5 text-left transition-colors hover:bg-foreground/10 {isActive
+	class="group flex min-h-9 w-full cursor-pointer items-center justify-between space-x-3 rounded-lg px-3 py-1.5 text-left transition-colors hover:bg-foreground/10 {isActive
 		? 'bg-foreground/5 text-accent-foreground'
 		: ''}"
 	onclick={handleSelect}
+	onmouseover={handleMouseOver}
+	onmouseleave={handleMouseLeave}
 >
 	<!-- svelte-ignore a11y_click_events_have_key_events -->
 	<!-- svelte-ignore a11y_no_static_element_interactions -->
-	<div
-		class="text flex min-w-0 flex-1 items-center space-x-3"
-		onclick={handleMobileSidebarItemClick}
-	>
-		<div class="min-w-0 flex-1">
-			<p class="truncate text-sm font-medium">{conversation.name}</p>
-
-			{#if showLastModified}
-				<div class="mt-2 flex flex-wrap items-center space-y-2 space-x-2">
-					<span class="w-full text-xs text-muted-foreground">
-						{formatLastModified(conversation.lastModified)}
-					</span>
-				</div>
-			{/if}
-		</div>
-	</div>
-
-	<div class="actions flex items-center">
-		<ActionDropdown
-			triggerIcon={MoreHorizontal}
-			triggerTooltip="More actions"
-			bind:open={showDropdown}
-			actions={[
-				{
-					icon: Pencil,
-					label: 'Edit',
-					onclick: handleEdit,
-					shortcut: ['shift', 'cmd', 'e']
-				},
-				{
-					icon: Trash2,
-					label: 'Delete',
-					onclick: (e) => {
-						e.stopPropagation();
-						showDeleteDialog = true;
+	<span class="truncate text-sm font-medium" onclick={handleMobileSidebarItemClick}>
+		{conversation.name}
+	</span>
+
+	{#if renderActionsDropdown}
+		<div class="actions flex items-center">
+			<ActionDropdown
+				triggerIcon={MoreHorizontal}
+				triggerTooltip="More actions"
+				bind:open={dropdownOpen}
+				actions={[
+					{
+						icon: Pencil,
+						label: 'Edit',
+						onclick: handleEdit,
+						shortcut: ['shift', 'cmd', 'e']
 					},
-					variant: 'destructive',
-					shortcut: ['shift', 'cmd', 'd'],
-					separator: true
-				}
-			]}
-		/>
-
-		<ConfirmationDialog
-			bind:open={showDeleteDialog}
-			title="Delete Conversation"
-			description={`Are you sure you want to delete "${conversation.name}"? This action cannot be undone and will permanently remove all messages in this conversation.`}
-			confirmText="Delete"
-			cancelText="Cancel"
-			variant="destructive"
-			icon={Trash2}
-			onConfirm={handleConfirmDelete}
-			onCancel={() => (showDeleteDialog = false)}
-		/>
-
-		<AlertDialog.Root bind:open={showEditDialog}>
-			<AlertDialog.Content>
-				<AlertDialog.Header>
-					<AlertDialog.Title>Edit Conversation Name</AlertDialog.Title>
-
-					<AlertDialog.Description>
-						<Input
-							class="mt-4 text-foreground"
-							onkeydown={(e) => {
-								if (e.key === 'Enter') {
-									e.preventDefault();
-									handleConfirmEdit();
-									showEditDialog = false;
-								}
-							}}
-							placeholder="Enter a new name"
-							type="text"
-							bind:value={editedName}
-						/>
-					</AlertDialog.Description>
-				</AlertDialog.Header>
-
-				<AlertDialog.Footer>
-					<AlertDialog.Cancel>Cancel</AlertDialog.Cancel>
-
-					<AlertDialog.Action onclick={handleConfirmEdit}>Save</AlertDialog.Action>
-				</AlertDialog.Footer>
-			</AlertDialog.Content>
-		</AlertDialog.Root>
-	</div>
+					{
+						icon: Trash2,
+						label: 'Delete',
+						onclick: handleDelete,
+						variant: 'destructive',
+						shortcut: ['shift', 'cmd', 'd'],
+						separator: true
+					}
+				]}
+			/>
+		</div>
+	{/if}
 </button>
 
 <style>
diff --git a/tools/server/webui/src/routes/+layout.svelte b/tools/server/webui/src/routes/+layout.svelte
index 6fbee0fe35500..a4555ed512996 100644
--- a/tools/server/webui/src/routes/+layout.svelte
+++ b/tools/server/webui/src/routes/+layout.svelte
@@ -140,6 +140,8 @@
 	});
 </script>
 
+<svelte:window onkeydown={handleKeydown} />
+
 <ModeWatcher />
 
 <Toaster richColors />
@@ -172,5 +174,3 @@
 		</Sidebar.Inset>
 	</div>
 </Sidebar.Provider>
-
-<svelte:window onkeydown={handleKeydown} />