diff --git a/.changeset/long-hairs-throw.md b/.changeset/long-hairs-throw.md
new file mode 100644
index 0000000000..a00b24fda3
--- /dev/null
+++ b/.changeset/long-hairs-throw.md
@@ -0,0 +1,5 @@
+---
+'@backstage/plugin-scaffolder': patch
+---
+
+Added a new `ui:autoSelect` option to the EntityPicker field that controls whether an entity is automatically selected when the field loses focus. When set to `false`, the field will remain empty if the user closes it without explicitly selecting an entity, preventing unintentional selections. Defaults to `true` for backward compatibility.
diff --git a/docs/features/software-templates/ui-options-examples.md b/docs/features/software-templates/ui-options-examples.md
index 845da8e60b..fd4b20d466 100644
--- a/docs/features/software-templates/ui-options-examples.md
+++ b/docs/features/software-templates/ui-options-examples.md
@@ -119,6 +119,36 @@ entity:
     defaultNamespace: payment
 ```
 
+### `autoSelect`
+
+Whether to automatically select the highlighted option when the input loses focus. Defaults to `true`.
+
+When set to `false`, users must explicitly select an option from the dropdown by clicking or pressing Enter. This prevents accidental selections when typing to filter options.
+
+- Default behavior with `autoSelect` as `true` (auto-selects on blur)
+
+```yaml
+entity:
+  title: Entity
+  type: string
+  description: Entity of the component
+  ui:field: EntityPicker
+  ui:options:
+    autoSelect: true
+```
+
+- Require explicit selection with `autoSelect` as `false`
+
+```yaml
+entity:
+  title: Entity
+  type: string
+  description: Entity of the component
+  ui:field: EntityPicker
+  ui:options:
+    autoSelect: false
+```
+
 ## MultiEntityPicker
 
 The input props that can be specified under `ui:options` for the `MultiEntityPicker` field extension.
diff --git a/plugins/scaffolder/report.api.md b/plugins/scaffolder/report.api.md
index e624b157fa..5c0fffbcc1 100644
--- a/plugins/scaffolder/report.api.md
+++ b/plugins/scaffolder/report.api.md
@@ -74,6 +74,7 @@ export const EntityNamePickerFieldExtension: FieldExtensionComponent_2<
 export const EntityPickerFieldExtension: FieldExtensionComponent_2<
   string,
   {
+    autoSelect?: boolean | undefined;
     defaultKind?: string | undefined;
     defaultNamespace?: string | false | undefined;
     catalogFilter?:
@@ -103,6 +104,7 @@ export const EntityPickerFieldExtension: FieldExtensionComponent_2<
 export const EntityPickerFieldSchema: FieldSchema_2<
   string,
   {
+    autoSelect?: boolean | undefined;
     defaultKind?: string | undefined;
     defaultNamespace?: string | false | undefined;
     catalogFilter?:
@@ -249,6 +251,7 @@ export type MyGroupsPickerUiOptions = NonNullable<
 export const OwnedEntityPickerFieldExtension: FieldExtensionComponent_2<
   string,
   {
+    autoSelect?: boolean | undefined;
     defaultKind?: string | undefined;
     defaultNamespace?: string | false | undefined;
     catalogFilter?:
@@ -278,6 +281,7 @@ export const OwnedEntityPickerFieldExtension: FieldExtensionComponent_2<
 export const OwnedEntityPickerFieldSchema: FieldSchema_2<
   string,
   {
+    autoSelect?: boolean | undefined;
     defaultKind?: string | undefined;
     defaultNamespace?: string | false | undefined;
     catalogFilter?:
diff --git a/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.test.tsx b/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.test.tsx
index 97c90b2aa5..4b272f1aa0 100644
--- a/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.test.tsx
+++ b/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.test.tsx
@@ -378,6 +378,100 @@ describe('<EntityPicker />', () => {
     });
   });
 
+  describe('ui:autoSelect behavior', () => {
+    beforeEach(() => {
+      uiSchema = {
+        'ui:options': {
+          defaultKind: 'Group',
+        },
+      };
+      props = {
+        onChange,
+        schema,
+        required,
+        uiSchema,
+        rawErrors,
+        formData,
+      } as unknown as FieldProps<any>;
+
+      catalogApi.getEntities.mockResolvedValue({ items: entities });
+    });
+
+    it('default behavior', async () => {
+      const { getByRole } = await renderInTestApp(
+        <Wrapper>
+          <EntityPicker {...props} />
+        </Wrapper>,
+      );
+
+      const input = getByRole('textbox');
+
+      // Type partial match and blur
+      fireEvent.change(input, { target: { value: 'team' } });
+      fireEvent.blur(input);
+
+      // Default behavior with freeSolo enabled processes the typed value
+      expect(onChange).toHaveBeenCalledWith('group:default/team');
+    });
+
+    it('does not autoSelect value onBlur', async () => {
+      uiSchema = {
+        'ui:options': {
+          defaultKind: 'Group',
+          autoSelect: false,
+        },
+      };
+      props = {
+        ...props,
+        uiSchema,
+      } as unknown as FieldProps<any>;
+
+      const { getByRole } = await renderInTestApp(
+        <Wrapper>
+          <EntityPicker {...props} />
+        </Wrapper>,
+      );
+
+      const input = getByRole('textbox');
+
+      // Type and blur - with autoSelect=false, the autocomplete won't auto-select on blur
+      fireEvent.change(input, { target: { value: 'team' } });
+      fireEvent.blur(input);
+
+      // With autoSelect=false, onChange should not be called on blur
+      // This is the key difference - users must explicitly select an option
+      expect(onChange).not.toHaveBeenCalled();
+    });
+
+    it('autoSelects entity onBlur', async () => {
+      uiSchema = {
+        'ui:options': {
+          defaultKind: 'Group',
+          autoSelect: true,
+        },
+      };
+      props = {
+        ...props,
+        uiSchema,
+      } as unknown as FieldProps<any>;
+
+      const { getByRole } = await renderInTestApp(
+        <Wrapper>
+          <EntityPicker {...props} />
+        </Wrapper>,
+      );
+
+      const input = getByRole('textbox');
+
+      // Type and blur
+      fireEvent.change(input, { target: { value: 'squad' } });
+      fireEvent.blur(input);
+
+      // With autoSelect=true and freeSolo, processes the typed value
+      expect(onChange).toHaveBeenCalledWith('group:default/squad');
+    });
+  });
+
   describe('uses full entity ref', () => {
     beforeEach(() => {
       uiSchema = {
diff --git a/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.tsx b/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.tsx
index d2197d4426..9a3dbd0009 100644
--- a/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.tsx
+++ b/plugins/scaffolder/src/components/fields/EntityPicker/EntityPicker.tsx
@@ -74,6 +74,7 @@ export const EntityPicker = (props: EntityPickerProps) => {
   const defaultKind = uiSchema['ui:options']?.defaultKind;
   const defaultNamespace =
     uiSchema['ui:options']?.defaultNamespace || undefined;
+  const autoSelect = uiSchema?.['ui:options']?.autoSelect ?? true;
   const isDisabled = uiSchema?.['ui:disabled'] ?? false;
 
   const catalogApi = useApi(catalogApiRef);
@@ -209,7 +210,7 @@ export const EntityPicker = (props: EntityPickerProps) => {
             : entities?.entityRefToPresentation.get(stringifyEntityRef(option))
                 ?.entityRef!
         }
-        autoSelect
+        autoSelect={autoSelect}
         freeSolo={allowArbitraryValues}
         renderInput={params => (
           <TextField
diff --git a/plugins/scaffolder/src/components/fields/EntityPicker/schema.ts b/plugins/scaffolder/src/components/fields/EntityPicker/schema.ts
index 5102d248b7..9a77d6b26e 100644
--- a/plugins/scaffolder/src/components/fields/EntityPicker/schema.ts
+++ b/plugins/scaffolder/src/components/fields/EntityPicker/schema.ts
@@ -61,6 +61,12 @@ export const EntityPickerFieldSchema = makeFieldSchema({
       )
         .optional()
         .describe('List of key-value filter expression for entities'),
+      autoSelect: z
+        .boolean()
+        .optional()
+        .describe(
+          'Whether to automatically select an option on blur. Defaults to true.',
+        ),
     }),
 });