diff --git a/.changeset/rude-bees-deliver.md b/.changeset/rude-bees-deliver.md
new file mode 100644
index 000000000..2e9090895
--- /dev/null
+++ b/.changeset/rude-bees-deliver.md
@@ -0,0 +1,5 @@
+---
+'@craftjs/core': patch
+---
+
+Remove node hovered state on mouseleave event
diff --git a/packages/core/src/events/DefaultEventHandlers.ts b/packages/core/src/events/DefaultEventHandlers.ts
index 4714b149c..95e6ef003 100644
--- a/packages/core/src/events/DefaultEventHandlers.ts
+++ b/packages/core/src/events/DefaultEventHandlers.ts
@@ -134,8 +134,18 @@ export class DefaultEventHandlers<O = {}> extends CoreEventHandlers<
           }
         );
 
+        const unbindMouseleave = this.addCraftEventListener(
+          el,
+          'mouseleave',
+          (e) => {
+            e.craft.stopPropagation();
+            store.actions.setNodeEvent('hovered', null);
+          }
+        );
+
         return () => {
           unbindMouseover();
+          unbindMouseleave();
         };
       },
       drop: (el: HTMLElement, targetId: NodeId) => {