diff --git a/.changeset/model-picker-provider-grouping.md b/.changeset/model-picker-provider-grouping.md
new file mode 100644
index 00000000000..1cc3b6a2d30
--- /dev/null
+++ b/.changeset/model-picker-provider-grouping.md
@@ -0,0 +1,5 @@
+---
+"@kilocode/cli": patch
+---
+
+Ensure custom provider category groups remain visible in the model picker when their models are in recent selections.
diff --git a/packages/tui/test/cli/cmd/tui/model-options.test.ts b/packages/tui/test/cli/cmd/tui/model-options.test.ts
deleted file mode 100644
index 97bae7532fe..00000000000
--- a/packages/tui/test/cli/cmd/tui/model-options.test.ts
+++ /dev/null
@@ -1,32 +0,0 @@
-import { describe, expect, test } from "bun:test"
-import { sortModelOptions } from "../../../../src/component/dialog-model"
-
-describe("sortModelOptions", () => {
-  test("orders provider-scoped model choices by newest release first", () => {
-    const sorted = sortModelOptions(
-      [
-        { title: "GPT 5.2", releaseDate: "2025-12-11" },
-        { title: "GPT 5.4", releaseDate: "2026-03-05" },
-        { title: "GPT 5.1", releaseDate: "2025-11-13" },
-      ],
-      true,
-    )
-
-    expect(sorted.map((model) => model.title)).toEqual(["GPT 5.4", "GPT 5.2", "GPT 5.1"])
-  })
-
-  test("orders regular model choices free-first and then newest-first", () => {
-    const sorted = sortModelOptions(
-      [
-        { title: "GLM 5", releaseDate: "2025-07-28" },
-        { title: "GLM 5.1", releaseDate: "2025-12-09" },
-        { title: "GLM 5.2", releaseDate: "2026-02-16" },
-        { title: "Free old", releaseDate: "2024-01-01", footer: "Free" },
-        { title: "Free new", releaseDate: "2025-01-01", footer: "Free" },
-      ],
-      false,
-    )
-
-    expect(sorted.map((model) => model.title)).toEqual(["Free new", "Free old", "GLM 5.2", "GLM 5.1", "GLM 5"])
-  })
-})
diff --git a/packages/tui/test/kilocode/model-picker.test.ts b/packages/tui/test/kilocode/model-picker.test.ts
index 7f24cc54853..3a5a0250b85 100644
--- a/packages/tui/test/kilocode/model-picker.test.ts
+++ b/packages/tui/test/kilocode/model-picker.test.ts
@@ -122,4 +122,28 @@ describe("model picker options", () => {
     expect(options.map((option) => option.modelID)).toContain(sonnet45.modelID)
     expect(options.map((option) => option.modelID)).toContain(sonnet4.modelID)
   })
+
+  test("keeps custom provider category intact when all its models are in recent (#13123)", () => {
+    const PROXSIS: ModelPickerProvider = {
+      id: "proxsis",
+      name: "Proxsis",
+      models: {
+        "Proxsis-Mimo25": { id: "Proxsis-Mimo25", name: "Proxsis Mimo25" },
+        "Proxsis-Mimo25Pro": { id: "Proxsis-Mimo25Pro", name: "Proxsis Mimo25 Pro" },
+      },
+    }
+
+    const options = buildModelPickerOptions({
+      providers: [PROXSIS],
+      connected: true,
+      showExtra: true,
+      recents: [
+        { providerID: "proxsis", modelID: "Proxsis-Mimo25" },
+        { providerID: "proxsis", modelID: "Proxsis-Mimo25Pro" },
+      ],
+    })
+
+    expect(inCategory(options, "Recent")).toEqual(["Proxsis-Mimo25", "Proxsis-Mimo25Pro"])
+    expect(inCategory(options, "Proxsis")).toEqual(["Proxsis-Mimo25", "Proxsis-Mimo25Pro"])
+  })
 })