diff --git a/shell/composables/__tests__/useClickOutside.test.ts b/shell/composables/__tests__/useClickOutside.test.ts
new file mode 100644
index 00000000000..7f4f41a6bd0
--- /dev/null
+++ b/shell/composables/__tests__/useClickOutside.test.ts
@@ -0,0 +1,232 @@
+import { defineComponent, ref } from 'vue';
+import { mount } from '@vue/test-utils';
+import type { VueWrapper } from '@vue/test-utils';
+import { useClickOutside } from '@shell/composables/useClickOutside';
+
+describe('useClickOutside', () => {
+  let capturedHandlers: Record<string, (e: any) => void>;
+  let addEventSpy: jest.SpyInstance;
+  let removeEventSpy: jest.SpyInstance;
+
+  beforeEach(() => {
+    capturedHandlers = {};
+    addEventSpy = jest.spyOn(window, 'addEventListener').mockImplementation((event: string, handler: any) => {
+      capturedHandlers[event] = handler;
+    });
+    removeEventSpy = jest.spyOn(window, 'removeEventListener').mockImplementation(() => {});
+  });
+
+  afterEach(() => {
+    jest.restoreAllMocks();
+  });
+
+  function mountWithHook(
+    componentEl: HTMLElement,
+    callback: any,
+    options: { ignore?: string[] } = {}
+  ): VueWrapper {
+    const componentRef = ref<HTMLElement | null>(componentEl);
+    const TestComponent = defineComponent({
+      setup() {
+        useClickOutside(componentRef, callback, options);
+
+        return {};
+      },
+      template: '<div></div>',
+    });
+
+    return mount(TestComponent);
+  }
+
+  function makeEvent(overrides: Partial<{ target: Element; composedPath: () => Element[]; detail: number }> = {}): any {
+    return {
+      target:       document.createElement('div'),
+      composedPath: () => [],
+      detail:       1,
+      ...overrides,
+    };
+  }
+
+  describe('lifecycle', () => {
+    it.each([
+      { desc: 'click', event: 'click' },
+      { desc: 'pointerdown', event: 'pointerdown' },
+    ])('registers the $desc event listener on mount', ({ event }) => {
+      mountWithHook(document.createElement('div'), jest.fn());
+
+      expect(addEventSpy).toHaveBeenCalledWith(event, expect.any(Function));
+    });
+
+    it.each([
+      { desc: 'click', event: 'click' },
+      { desc: 'pointerdown', event: 'pointerdown' },
+    ])('removes the $desc event listener on unmount', ({ event }) => {
+      const wrapper = mountWithHook(document.createElement('div'), jest.fn());
+
+      wrapper.unmount();
+
+      expect(removeEventSpy).toHaveBeenCalledWith(event, expect.any(Function));
+    });
+  });
+
+  describe('click listener', () => {
+    it('calls callback when click target is outside the component element', () => {
+      const target = document.createElement('div');
+      const outsideEl = document.createElement('span');
+      const callback = jest.fn();
+
+      mountWithHook(target, callback);
+
+      capturedHandlers['click'](makeEvent({ target: outsideEl, composedPath: () => [outsideEl] }));
+
+      expect(callback).toHaveBeenCalledWith();
+    });
+
+    it('does not call callback when click target is the component element', () => {
+      const target = document.createElement('div');
+      const callback = jest.fn();
+
+      mountWithHook(target, callback);
+
+      capturedHandlers['click'](makeEvent({ target, composedPath: () => [target] }));
+
+      expect(callback).not.toHaveBeenCalled();
+    });
+
+    it('does not call callback when the composedPath of the click includes the component element', () => {
+      const target = document.createElement('div');
+      const child = document.createElement('span');
+      const callback = jest.fn();
+
+      mountWithHook(target, callback);
+
+      capturedHandlers['click'](makeEvent({ target: child, composedPath: () => [child, target] }));
+
+      expect(callback).not.toHaveBeenCalled();
+    });
+
+    it('does not call callback when component.value is null', () => {
+      const callback = jest.fn();
+      const componentRef = ref<HTMLElement | null>(null);
+      const TestComponent = defineComponent({
+        setup() {
+          useClickOutside(componentRef, callback);
+
+          return {};
+        },
+        template: '<div></div>',
+      });
+
+      mount(TestComponent);
+
+      capturedHandlers['click'](makeEvent());
+
+      expect(callback).not.toHaveBeenCalled();
+    });
+
+    it('does not throw when callback is not a function', () => {
+      const target = document.createElement('div');
+      const outsideEl = document.createElement('span');
+
+      mountWithHook(target, 'not-a-function');
+
+      expect(() => {
+        capturedHandlers['click'](makeEvent({ target: outsideEl, composedPath: () => [outsideEl] }));
+      }).not.toThrow();
+    });
+  });
+
+  describe('ignore option', () => {
+    it('suppresses callback when a prior pointerdown targeted a css-selector-matched ignore element', () => {
+      const target = document.createElement('div');
+      const ignoredEl = document.createElement('button');
+
+      ignoredEl.className = 'dropdown-menu';
+      document.body.appendChild(ignoredEl);
+
+      const callback = jest.fn();
+
+      mountWithHook(target, callback, { ignore: ['.dropdown-menu'] });
+
+      capturedHandlers['pointerdown'](makeEvent({
+        target:       ignoredEl,
+        composedPath: () => [ignoredEl],
+      }));
+
+      capturedHandlers['click'](makeEvent({
+        target:       document.createElement('span'),
+        composedPath: () => [document.createElement('span')],
+      }));
+
+      expect(callback).not.toHaveBeenCalled();
+
+      document.body.removeChild(ignoredEl);
+    });
+
+    it('calls callback when pointerdown targets a non-ignored element outside the component', () => {
+      const target = document.createElement('div');
+      const outsideEl = document.createElement('span');
+      const callback = jest.fn();
+
+      mountWithHook(target, callback, { ignore: ['.dropdown-menu'] });
+
+      capturedHandlers['pointerdown'](makeEvent({
+        target:       outsideEl,
+        composedPath: () => [outsideEl],
+      }));
+
+      capturedHandlers['click'](makeEvent({
+        target:       outsideEl,
+        composedPath: () => [outsideEl],
+      }));
+
+      expect(callback).toHaveBeenCalledWith();
+    });
+  });
+
+  describe('pointerdown inside component', () => {
+    it('does not call callback when pointerdown was inside the component and click was outside', () => {
+      const target = document.createElement('div');
+      const outsideEl = document.createElement('span');
+      const callback = jest.fn();
+
+      mountWithHook(target, callback);
+
+      capturedHandlers['pointerdown'](makeEvent({
+        target,
+        composedPath: () => [target],
+      }));
+
+      capturedHandlers['click'](makeEvent({
+        target:       outsideEl,
+        composedPath: () => [outsideEl],
+      }));
+
+      expect(callback).not.toHaveBeenCalled();
+    });
+  });
+
+  describe('keyboard click (detail=0)', () => {
+    it('does not call callback when detail is 0 and click event target matches an ignore selector', () => {
+      const target = document.createElement('div');
+      const ignoredEl = document.createElement('button');
+
+      ignoredEl.className = 'skip-kb';
+      document.body.appendChild(ignoredEl);
+
+      const callback = jest.fn();
+
+      mountWithHook(target, callback, { ignore: ['.skip-kb'] });
+
+      capturedHandlers['click'](makeEvent({
+        target:       ignoredEl,
+        composedPath: () => [ignoredEl],
+        detail:       0,
+      }));
+
+      expect(callback).not.toHaveBeenCalled();
+
+      document.body.removeChild(ignoredEl);
+    });
+  });
+});