diff --git a/.changeset/silly-feet-buy.md b/.changeset/silly-feet-buy.md
new file mode 100644
index 000000000..e176fc331
--- /dev/null
+++ b/.changeset/silly-feet-buy.md
@@ -0,0 +1,5 @@
+---
+'@reservoir0x/relay-kit-ui': patch
+---
+
+Optimize token list merging and sorting logic in TokenSelector
diff --git a/packages/ui/src/components/common/TokenSelector/TokenSelector.tsx b/packages/ui/src/components/common/TokenSelector/TokenSelector.tsx
index 1201ae2e1..060cc8323 100644
--- a/packages/ui/src/components/common/TokenSelector/TokenSelector.tsx
+++ b/packages/ui/src/components/common/TokenSelector/TokenSelector.tsx
@@ -34,6 +34,7 @@ import { bitcoin } from '../../../utils/bitcoin.js'
 import { evmDeadAddress } from '@reservoir0x/relay-sdk'
 import { solDeadAddress } from '@reservoir0x/relay-sdk'
 import { bitcoinDeadAddress } from '@reservoir0x/relay-sdk'
+import { mergeTokenLists } from '../../../utils/tokens.js'
 
 export type TokenSelectorProps = {
   openState?: [boolean, React.Dispatch<React.SetStateAction<boolean>>]
@@ -263,7 +264,7 @@ const TokenSelector: FC<TokenSelectorProps> = ({
       suggestedTokenQuery
         ? {
             tokens: suggestedTokenQuery,
-            limit: 20,
+            limit: 30,
             depositAddressOnly
           }
         : undefined,
@@ -299,47 +300,44 @@ const TokenSelector: FC<TokenSelectorProps> = ({
     return mergedList
   }, [tokenList, externalTokenList])
 
-  // Filter out unconfigured chains and append Relay Chain to each currency
+  // Enhance token list with Relay chain data, balances and sort by usd value/balances
   const enhancedCurrencyList = useMemo(() => {
-    const _tokenList =
-      combinedTokenList && (combinedTokenList as any).length
-        ? (combinedTokenList as CurrencyList[])
-        : undefined
-
+    // Filter suggested tokens by chain if needed
     const filteredSuggestedTokens = chainFilter.id
-      ? suggestedTokens
-          ?.map((tokenList) =>
-            tokenList.filter((token) => token.chainId === chainFilter.id)
-          )
-          .filter((tokenList) => tokenList.length > 0)
+      ? suggestedTokens?.map((tokenList) =>
+          tokenList.filter((token) => token.chainId === chainFilter.id)
+        )
       : suggestedTokens
 
-    let list =
-      context === 'from' &&
-      useDefaultTokenList &&
-      chainFilter.id === undefined &&
-      filteredSuggestedTokens &&
-      filteredSuggestedTokens.length > 0
-        ? filteredSuggestedTokens
-        : combinedTokenList
-
-    const ethTokens = _tokenList?.find(
-      (list) => list[0] && list[0].groupID === 'ETH'
+    // Only merge suggested tokens when using default list
+    const list = useDefaultTokenList
+      ? mergeTokenLists([filteredSuggestedTokens, combinedTokenList])
+      : combinedTokenList || []
+
+    // Prioritize ETH and USDC tokens
+    const ethTokens = list.find(
+      (tokenList) => tokenList[0] && tokenList[0].groupID === 'ETH'
     )
-    const usdcTokens = _tokenList?.find(
-      (list) => list[0] && list[0].groupID === 'USDC'
+    const usdcTokens = list.find(
+      (tokenList) => tokenList[0] && tokenList[0].groupID === 'USDC'
     )
-    if (list && suggestedTokens) {
-      list = list?.filter(
-        (tokenList) =>
-          tokenList[0] &&
-          tokenList[0].groupID !== 'ETH' &&
-          tokenList[0].groupID !== 'USDC'
-      )
-      list = [ethTokens ?? [], usdcTokens ?? []].concat(list)
-    }
 
-    const mappedList = list?.map((currencyList) => {
+    // Remove ETH/USDC from main list and add them to the front
+    const filteredList = list.filter(
+      (tokenList) =>
+        tokenList[0] &&
+        tokenList[0].groupID !== 'ETH' &&
+        tokenList[0].groupID !== 'USDC'
+    )
+
+    const sortedList = [
+      ...(ethTokens ? [ethTokens] : []),
+      ...(usdcTokens ? [usdcTokens] : []),
+      ...filteredList
+    ]
+
+    // Map and enhance the currency list
+    const mappedList = sortedList?.map((currencyList) => {
       const filteredList = currencyList
         .map((currency) => {
           const relayChain = configuredChains.find(
@@ -394,8 +392,21 @@ const TokenSelector: FC<TokenSelectorProps> = ({
           totalValueUsd
         }
       })
-      .filter((list) => list !== undefined)
-      .sort((a, b) => (b?.totalValueUsd ?? 0) - (a?.totalValueUsd ?? 0))
+      .filter((list): list is NonNullable<typeof list> => list !== undefined)
+      .sort((a, b) => {
+        // First sort by USD value if available
+        if (a.totalValueUsd !== b.totalValueUsd) {
+          return b.totalValueUsd - a.totalValueUsd
+        }
+        // Then sort by balance if USD value is equal or undefined
+        if (a.totalBalance !== b.totalBalance) {
+          return Number(b.totalBalance - a.totalBalance)
+        }
+        // Finally prioritize verified tokens
+        const aVerified = a.chains[0]?.metadata?.verified ?? false
+        const bVerified = b.chains[0]?.metadata?.verified ?? false
+        return bVerified === aVerified ? 0 : bVerified ? 1 : -1
+      })
   }, [
     context,
     combinedTokenList,
diff --git a/packages/ui/src/components/common/TokenSelector/steps/SetCurrencyStep.tsx b/packages/ui/src/components/common/TokenSelector/steps/SetCurrencyStep.tsx
index 932de20de..fa8cc4e1e 100644
--- a/packages/ui/src/components/common/TokenSelector/steps/SetCurrencyStep.tsx
+++ b/packages/ui/src/components/common/TokenSelector/steps/SetCurrencyStep.tsx
@@ -409,7 +409,7 @@ export const SetCurrencyStep: FC<SetCurrencyProps> = ({
                   }}
                 />
                 <Text style="subtitle3" color="subtle">
-                  Popular Tokens
+                  Suggested Tokens
                 </Text>
               </>
             ) : null}
diff --git a/packages/ui/src/utils/tokens.ts b/packages/ui/src/utils/tokens.ts
index cf5e14161..065ff1d77 100644
--- a/packages/ui/src/utils/tokens.ts
+++ b/packages/ui/src/utils/tokens.ts
@@ -1,3 +1,4 @@
+import type { CurrencyList } from '@reservoir0x/relay-kit-hooks'
 import type { Token } from '../types/index.js'
 import { ASSETS_RELAY_API } from '@reservoir0x/relay-sdk'
 import type { paths, RelayChain } from '@reservoir0x/relay-sdk'
@@ -42,3 +43,26 @@ export const findBridgableToken = (chain?: RelayChain, token?: Token) => {
   }
   return null
 }
+
+export const mergeTokenLists = (lists: (CurrencyList[] | undefined)[]) => {
+  const mergedList: CurrencyList[] = []
+  const seenTokens = new Set<string>()
+
+  lists.forEach((list) => {
+    if (!list) return
+
+    list.forEach((currencyList) => {
+      const currency = currencyList[0]
+      if (!currency) return
+
+      const tokenKey = `${currency.chainId}:${currency.address?.toLowerCase()}`
+
+      if (!seenTokens.has(tokenKey)) {
+        seenTokens.add(tokenKey)
+        mergedList.push(currencyList)
+      }
+    })
+  })
+
+  return mergedList
+}