diff --git a/packages/components/CHANGELOG.md b/packages/components/CHANGELOG.md
index 3b9682c4adf4c6..e200416e29e0ba 100644
--- a/packages/components/CHANGELOG.md
+++ b/packages/components/CHANGELOG.md
@@ -2,6 +2,10 @@
 
 ## Unreleased
 
+### Enhancement
+
+-   `FormTokenField`: Add `tokenizeOnBlur` prop to add any incompleteTokenValue as a new token when field loses focus ([#53976](https://github.com/WordPress/gutenberg/pull/53976)).
+
 ### Bug Fix
 
 -   `SandBox`: Fix the cleanup method in useEffect ([#53796](https://github.com/WordPress/gutenberg/pull/53796)).
diff --git a/packages/components/src/form-token-field/README.md b/packages/components/src/form-token-field/README.md
index 90fe84e56f2ee6..3a4ce2a143624a 100644
--- a/packages/components/src/form-token-field/README.md
+++ b/packages/components/src/form-token-field/README.md
@@ -62,6 +62,7 @@ The `value` property is handled in a manner similar to controlled form component
 -   `__experimentalValidateInput` - If passed, all introduced values will be validated before being added as tokens.
 -   `__experimentalAutoSelectFirstMatch` - If true, the select the first matching suggestion when the user presses the Enter key (or space when tokenizeOnSpace is true).
 -   `__nextHasNoMarginBottom` - Start opting into the new margin-free styles that will become the default in a future version, currently scheduled to be WordPress 6.5. (The prop can be safely removed once this happens.)
+-   `tokenizeOnBlur` - If true, add any incompleteTokenValue as a new token when the field loses focus.
 
 ## Usage
 
diff --git a/packages/components/src/form-token-field/index.tsx b/packages/components/src/form-token-field/index.tsx
index e3781880370628..b3a5c5a53d4c0a 100644
--- a/packages/components/src/form-token-field/index.tsx
+++ b/packages/components/src/form-token-field/index.tsx
@@ -73,6 +73,7 @@ export function FormTokenField( props: FormTokenFieldProps ) {
 		__next40pxDefaultSize = false,
 		__experimentalAutoSelectFirstMatch = false,
 		__nextHasNoMarginBottom = false,
+		tokenizeOnBlur = false,
 	} = useDeprecated36pxDefaultSizeProp< FormTokenFieldProps >(
 		props,
 		'wp.components.FormTokenField'
@@ -167,6 +168,9 @@ export function FormTokenField( props: FormTokenFieldProps ) {
 			__experimentalValidateInput( incompleteTokenValue )
 		) {
 			setIsActive( false );
+			if ( tokenizeOnBlur && inputHasValidValue() ) {
+				addNewToken( incompleteTokenValue );
+			}
 		} else {
 			// Reset to initial state
 			setIncompleteTokenValue( '' );
@@ -451,7 +455,7 @@ export function FormTokenField( props: FormTokenFieldProps ) {
 		setSelectedSuggestionScroll( false );
 		setIsExpanded( ! __experimentalExpandOnFocus );
 
-		if ( isActive ) {
+		if ( isActive && ! tokenizeOnBlur ) {
 			focus();
 		}
 	}
diff --git a/packages/components/src/form-token-field/test/index.tsx b/packages/components/src/form-token-field/test/index.tsx
index e62e851f1cf226..76e308d5993beb 100644
--- a/packages/components/src/form-token-field/test/index.tsx
+++ b/packages/components/src/form-token-field/test/index.tsx
@@ -205,7 +205,42 @@ describe( 'FormTokenField', () => {
 			] );
 		} );
 
-		it( "should not add a token with the input's value when pressing the tab key", async () => {
+		it( 'should add a token with the input value with onBlur when `tokenizeOnBlur` prop is `true`', async () => {
+			const user = userEvent.setup();
+
+			const onChangeSpy = jest.fn();
+
+			const { rerender } = render(
+				<FormTokenFieldWithState onChange={ onChangeSpy } />
+			);
+
+			const input = screen.getByRole( 'combobox' );
+
+			// Add 'grapefruit' token by typing it and check blur of field does not tokenize it.
+			await user.type( input, 'grapefruit' );
+			await user.click( document.body );
+			expect( onChangeSpy ).toHaveBeenCalledTimes( 0 );
+			expectTokensNotToBeInTheDocument( [ 'grapefruit' ] );
+
+			rerender(
+				<FormTokenFieldWithState
+					onChange={ onChangeSpy }
+					tokenizeOnBlur
+				/>
+			);
+			await user.clear( input );
+
+			// Add 'grapefruit' token by typing it and check blur of field tokenizes it.
+			await user.type( input, 'grapefruit' );
+
+			await user.click( document.body );
+			expect( onChangeSpy ).toHaveBeenNthCalledWith( 1, [
+				'grapefruit',
+			] );
+			expectTokensToBeInTheDocument( [ 'grapefruit' ] );
+		} );
+
+		it( "should not add a token with the input's value when tokenizeOnBlur is not set and pressing the tab key", async () => {
 			const user = userEvent.setup();
 
 			const onChangeSpy = jest.fn();
diff --git a/packages/components/src/form-token-field/types.ts b/packages/components/src/form-token-field/types.ts
index fe466ffbe59f84..e343601106f411 100644
--- a/packages/components/src/form-token-field/types.ts
+++ b/packages/components/src/form-token-field/types.ts
@@ -182,6 +182,12 @@ export interface FormTokenFieldProps
 	 * @default false
 	 */
 	__nextHasNoMarginBottom?: boolean;
+	/**
+	 * If true, add any incompleteTokenValue as a new token when the field loses focus.
+	 *
+	 * @default false
+	 */
+	tokenizeOnBlur?: boolean;
 }
 
 /**
diff --git a/packages/patterns/src/components/category-selector.js b/packages/patterns/src/components/category-selector.js
index f8295af2a79dc9..c9305806c7e13f 100644
--- a/packages/patterns/src/components/category-selector.js
+++ b/packages/patterns/src/components/category-selector.js
@@ -111,6 +111,7 @@ export default function CategorySelector( { onCategorySelection } ) {
 				onInputChange={ debouncedSearch }
 				maxSuggestions={ MAX_TERMS_SUGGESTIONS }
 				label={ __( 'Categories' ) }
+				tokenizeOnBlur={ true }
 			/>
 		</>
 	);