diff --git a/packages/mui-material/src/Autocomplete/Autocomplete.js b/packages/mui-material/src/Autocomplete/Autocomplete.js
index f165b797e12aa1..f249219d26da5e 100644
--- a/packages/mui-material/src/Autocomplete/Autocomplete.js
+++ b/packages/mui-material/src/Autocomplete/Autocomplete.js
@@ -738,7 +738,11 @@ const Autocomplete = React.forwardRef(function Autocomplete(inProps, ref) {
             ref: setAnchorEl,
             className: classes.inputRoot,
             startAdornment,
-            onMouseDown: (event) => handleInputMouseDown(event),
+            onMouseDown: (event) => {
+              if (event.target === event.currentTarget) {
+                handleInputMouseDown(event);
+              }
+            },
             ...((hasClearIcon || hasPopupIcon) && {
               endAdornment: (
                 <AutocompleteEndAdornment className={classes.endAdornment} ownerState={ownerState}>
diff --git a/packages/mui-material/src/Autocomplete/Autocomplete.test.js b/packages/mui-material/src/Autocomplete/Autocomplete.test.js
index 506e0decd989c5..97099aa953faee 100644
--- a/packages/mui-material/src/Autocomplete/Autocomplete.test.js
+++ b/packages/mui-material/src/Autocomplete/Autocomplete.test.js
@@ -442,39 +442,6 @@ describe('<Autocomplete />', () => {
         expect(getAllByRole('button', { hidden: false })).to.have.lengthOf(5);
       }
     });
-
-    // Test for https://github.com/mui/material-ui/issues/42432
-    it('when the input box needs to expand downward, the listbox should remain open.', () => {
-      const options = [
-        'The Lord of the Rings: The Return of the King',
-        'The Good, the Bad and the Ugly',
-        'The Shawshank Redemption',
-        'Star Wars: Episode V - The Empire Strikes Back',
-      ];
-      const defaultValue = [
-        'The Lord of the Rings: The Return of the King',
-        'The Good, the Bad and the Ugly',
-        'The Shawshank Redemption',
-      ];
-
-      render(
-        <Autocomplete
-          multiple
-          limitTags={2}
-          options={options}
-          defaultValue={defaultValue}
-          renderInput={(params) => <TextField {...params} />}
-          sx={{ width: 500 }}
-        />,
-      );
-
-      const textbox = screen.getByRole('combobox');
-
-      fireEvent.mouseDown(textbox);
-
-      const listbox = screen.getByRole('listbox');
-      expect(listbox).toBeVisible();
-    });
   });
 
   describe('prop: filterSelectedOptions', () => {
@@ -892,6 +859,49 @@ describe('<Autocomplete />', () => {
     expect(handleSubmit.callCount).to.equal(4);
   });
 
+  it('should not open the autocomplete popup when deleting chips', async () => {
+    const { queryByRole, queryByText, user } = render(
+      <Autocomplete
+        multiple
+        options={['one', 'two', 'three']}
+        defaultValue={['one']}
+        renderInput={(params) => <TextField {...params} autoFocus />}
+      />,
+    );
+
+    expect(queryByRole('listbox')).to.equal(null);
+
+    const chip = queryByText('one').parentElement;
+    expect(chip).not.to.equal(null);
+
+    // Delete the chip
+    await user.click(chip.getElementsByClassName(chipClasses.deleteIcon)[0]);
+
+    expect(queryByText('one')).to.equal(null);
+    expect(queryByRole('listbox')).to.equal(null);
+  });
+
+  it('should toggle the autocomplete popup when clicking the popup indicator', async () => {
+    const { queryByRole, getByRole, user } = render(
+      <Autocomplete
+        multiple
+        options={['One', 'Two', 'Three']}
+        renderInput={(params) => <TextField {...params} autoFocus />}
+      />,
+    );
+
+    expect(queryByRole('listbox')).to.equal(null);
+
+    const popupIndicator = getByRole('button', { name: 'Open' });
+    await user.click(popupIndicator);
+
+    expect(queryByRole('listbox')).not.to.equal(null);
+
+    await user.click(popupIndicator);
+
+    expect(queryByRole('listbox')).to.equal(null);
+  });
+
   describe('prop: getOptionDisabled', () => {
     it('should prevent the disabled option to trigger actions but allow focus with disabledItemsFocusable', () => {
       const handleSubmit = spy();
diff --git a/packages/mui-material/src/useAutocomplete/useAutocomplete.js b/packages/mui-material/src/useAutocomplete/useAutocomplete.js
index 28b161a763a221..35789e85e2917c 100644
--- a/packages/mui-material/src/useAutocomplete/useAutocomplete.js
+++ b/packages/mui-material/src/useAutocomplete/useAutocomplete.js
@@ -1020,7 +1020,6 @@ function useAutocomplete(props) {
   const handleInputMouseDown = (event) => {
     if (!disabledProp && (inputValue === '' || !open)) {
       handlePopupIndicator(event);
-      event.stopPropagation();
     }
   };
 
@@ -1109,7 +1108,6 @@ function useAutocomplete(props) {
       tabIndex: -1,
       type: 'button',
       onClick: handlePopupIndicator,
-      onMouseDown: (event) => event.stopPropagation(),
     }),
     getTagProps: ({ index }) => ({
       key: index,
diff --git a/test/regressions/fixtures/Autocomplete/TextboxExpandsOnListboxOpen.js b/test/regressions/fixtures/Autocomplete/TextboxExpandsOnListboxOpen.js
new file mode 100644
index 00000000000000..d5c43e69c0bc78
--- /dev/null
+++ b/test/regressions/fixtures/Autocomplete/TextboxExpandsOnListboxOpen.js
@@ -0,0 +1,18 @@
+import * as React from 'react';
+import TextField from '@mui/material/TextField';
+import Autocomplete from '@mui/material/Autocomplete';
+
+export default function StandardAutocomplete() {
+  return (
+    <div style={{ height: 220 }}>
+      <Autocomplete
+        multiple
+        limitTags={2}
+        options={['One', 'Two', 'Three']}
+        defaultValue={['One', 'Two', 'Three']}
+        renderInput={(params) => <TextField {...params} />}
+        sx={{ width: 300 }}
+      />
+    </div>
+  );
+}
diff --git a/test/regressions/index.test.js b/test/regressions/index.test.js
index 4eb8657c904c32..290b89661556b1 100644
--- a/test/regressions/index.test.js
+++ b/test/regressions/index.test.js
@@ -131,6 +131,20 @@ async function main() {
         await takeScreenshot({ testcase, route: '/regression-Rating/PreciseFocusVisibleRating3' });
       });
     });
+
+    describe('Autocomplete', () => {
+      it('should not close immediately when textbox expands', async () => {
+        const testcase = await renderFixture(
+          '/regression-Autocomplete/TextboxExpandsOnListboxOpen',
+        );
+        await page.getByRole('combobox').click();
+        await page.waitForTimeout(10);
+        await takeScreenshot({
+          testcase,
+          route: '/regression-Autocomplete/TextboxExpandsOnListboxOpen2',
+        });
+      });
+    });
   });
 
   run();