diff --git a/packages/next/client/components/react-dev-overlay/internal/ReactDevOverlay.tsx b/packages/next/client/components/react-dev-overlay/internal/ReactDevOverlay.tsx
index ee85548be45103f..931a1c93ca74517 100644
--- a/packages/next/client/components/react-dev-overlay/internal/ReactDevOverlay.tsx
+++ b/packages/next/client/components/react-dev-overlay/internal/ReactDevOverlay.tsx
@@ -76,9 +76,9 @@ class ReactDevOverlay extends React.PureComponent<
             ) : hasBuildError ? (
               <BuildError message={state.buildError!} />
             ) : hasRuntimeErrors ? (
-              <Errors errors={state.errors} />
+              <Errors initialDisplayState="minimized" errors={state.errors} />
             ) : reactError ? (
-              <Errors errors={[reactError]} />
+              <Errors initialDisplayState="fullscreen" errors={[reactError]} />
             ) : undefined}
           </ShadowPortal>
         ) : undefined}
diff --git a/packages/next/client/components/react-dev-overlay/internal/container/Errors.tsx b/packages/next/client/components/react-dev-overlay/internal/container/Errors.tsx
index 84d83cd46f58c65..22d0c90777f4043 100644
--- a/packages/next/client/components/react-dev-overlay/internal/container/Errors.tsx
+++ b/packages/next/client/components/react-dev-overlay/internal/container/Errors.tsx
@@ -24,10 +24,15 @@ export type SupportedErrorEvent = {
   id: number
   event: UnhandledErrorAction | UnhandledRejectionAction
 }
-export type ErrorsProps = { errors: SupportedErrorEvent[] }
+export type ErrorsProps = {
+  errors: SupportedErrorEvent[]
+  initialDisplayState: DisplayState
+}
 
 type ReadyErrorEvent = ReadyRuntimeError
 
+type DisplayState = 'minimized' | 'fullscreen' | 'hidden'
+
 function getErrorSignature(ev: SupportedErrorEvent): string {
   const { event } = ev
   switch (event.type) {
@@ -73,7 +78,10 @@ const HotlinkedText: React.FC<{
   )
 }
 
-export const Errors: React.FC<ErrorsProps> = function Errors({ errors }) {
+export const Errors: React.FC<ErrorsProps> = function Errors({
+  errors,
+  initialDisplayState,
+}) {
   const [lookups, setLookups] = React.useState(
     {} as { [eventId: string]: ReadyErrorEvent }
   )
@@ -137,9 +145,8 @@ export const Errors: React.FC<ErrorsProps> = function Errors({ errors }) {
     }
   }, [nextError])
 
-  const [displayState, setDisplayState] = React.useState<
-    'minimized' | 'fullscreen' | 'hidden'
-  >('fullscreen')
+  const [displayState, setDisplayState] =
+    React.useState<DisplayState>(initialDisplayState)
   const [activeIdx, setActiveIndex] = React.useState<number>(0)
   const previous = React.useCallback((e?: MouseEvent | TouchEvent) => {
     e?.preventDefault()
diff --git a/test/development/acceptance-app/ReactRefreshLogBox.test.ts b/test/development/acceptance-app/ReactRefreshLogBox.test.ts
index 3a372d42d427698..6e73c94dfa900eb 100644
--- a/test/development/acceptance-app/ReactRefreshLogBox.test.ts
+++ b/test/development/acceptance-app/ReactRefreshLogBox.test.ts
@@ -49,7 +49,7 @@ describe('ReactRefreshLogBox app', () => {
     )
     await session.evaluate(() => document.querySelector('a').click())
 
-    expect(await session.hasRedbox(true)).toBe(true)
+    await session.waitForAndOpenRuntimeError()
     expect(await session.getRedboxSource()).toMatchSnapshot()
 
     await cleanup()
@@ -481,7 +481,7 @@ describe('ReactRefreshLogBox app', () => {
     )
 
     await new Promise((resolve) => setTimeout(resolve, 1000))
-    expect(await session.hasRedbox(true)).toBe(true)
+    await session.waitForAndOpenRuntimeError()
     if (process.platform === 'win32') {
       expect(await session.getRedboxSource()).toMatchSnapshot()
     } else {
@@ -568,7 +568,7 @@ describe('ReactRefreshLogBox app', () => {
       `export default function FunctionDefault() { throw new Error('no'); }`
     )
 
-    expect(await session.hasRedbox(true)).toBe(true)
+    await session.waitForAndOpenRuntimeError()
     expect(await session.getRedboxSource()).toMatchSnapshot()
     expect(
       await session.evaluate(() => document.querySelector('h2').textContent)
@@ -770,9 +770,8 @@ describe('ReactRefreshLogBox app', () => {
       `
     )
 
-    expect(await session.hasRedbox()).toBe(false)
     await session.evaluate(() => document.querySelector('button').click())
-    expect(await session.hasRedbox(true)).toBe(true)
+    await session.waitForAndOpenRuntimeError()
 
     const header = await session.getRedboxDescription()
     expect(header).toMatchSnapshot()
@@ -816,9 +815,8 @@ describe('ReactRefreshLogBox app', () => {
       `
     )
 
-    expect(await session.hasRedbox()).toBe(false)
     await session.evaluate(() => document.querySelector('button').click())
-    expect(await session.hasRedbox(true)).toBe(true)
+    await session.waitForAndOpenRuntimeError()
 
     const header2 = await session.getRedboxDescription()
     expect(header2).toMatchSnapshot()
@@ -862,9 +860,8 @@ describe('ReactRefreshLogBox app', () => {
       `
     )
 
-    expect(await session.hasRedbox()).toBe(false)
     await session.evaluate(() => document.querySelector('button').click())
-    expect(await session.hasRedbox(true)).toBe(true)
+    await session.waitForAndOpenRuntimeError()
 
     const header3 = await session.getRedboxDescription()
     expect(header3).toMatchSnapshot()
@@ -908,9 +905,8 @@ describe('ReactRefreshLogBox app', () => {
       `
     )
 
-    expect(await session.hasRedbox()).toBe(false)
     await session.evaluate(() => document.querySelector('button').click())
-    expect(await session.hasRedbox(true)).toBe(true)
+    await session.waitForAndOpenRuntimeError()
 
     const header4 = await session.getRedboxDescription()
     expect(header4).toMatchInlineSnapshot(
@@ -1085,4 +1081,76 @@ describe('ReactRefreshLogBox app', () => {
 
     await cleanup()
   })
+
+  test('Unhandled errors and rejections opens up in the minimized state', async () => {
+    const { session, browser, cleanup } = await sandbox(next)
+
+    const file = `
+    export default function Index() {
+      //
+      setTimeout(() => {
+        throw new Error('Unhandled error')
+      }, 0)
+      setTimeout(() => {
+        Promise.reject(new Error('Undhandled rejection'))
+      }, 0)
+      return (
+        <>
+          <button
+            id="unhandled-error"
+            onClick={() => {
+              throw new Error('Unhandled error')
+            }}
+          >
+            Unhandled error
+          </button>
+          <button
+            id="unhandled-rejection"
+            onClick={() => {
+              Promise.reject(new Error('Undhandled rejection'))
+            }}
+          >
+            Unhandled rejection
+          </button>
+        </>
+      )
+    }
+    `
+
+    await session.patch('index.js', file)
+
+    // Unhandled error and rejection in setTimeout
+    expect(
+      await browser.waitForElementByCss('.nextjs-toast-errors').text()
+    ).toBe('2 errors')
+
+    // Unhandled error in event handler
+    await browser.elementById('unhandled-error').click()
+    await check(
+      () => browser.elementByCss('.nextjs-toast-errors').text(),
+      /3 errors/
+    )
+
+    // Unhandled rejection in event handler
+    await browser.elementById('unhandled-rejection').click()
+    await check(
+      () => browser.elementByCss('.nextjs-toast-errors').text(),
+      /4 errors/
+    )
+    expect(await session.hasRedbox()).toBe(false)
+
+    // Add Component error
+    await session.patch(
+      'index.js',
+      file.replace(
+        '//',
+        "if (typeof window !== 'undefined') throw new Error('Component error')"
+      )
+    )
+
+    // Render error should "win" and show up in fullscreen
+    expect(await session.hasRedbox(true)).toBe(true)
+
+    await cleanup()
+  })
 })
diff --git a/test/development/acceptance-app/helpers.ts b/test/development/acceptance-app/helpers.ts
index f0787fb84b76dad..c97d311cb6bc74f 100644
--- a/test/development/acceptance-app/helpers.ts
+++ b/test/development/acceptance-app/helpers.ts
@@ -112,6 +112,9 @@ export async function sandbox(
         }
         return source
       },
+      async waitForAndOpenRuntimeError() {
+        return browser.waitForElementByCss('[data-nextjs-toast]').click()
+      },
     },
     async cleanup() {
       await browser.close()