diff --git a/crates/outline/src/outline.rs b/crates/outline/src/outline.rs
index 78c4d9c148eec3..1f88c12a2b7301 100644
--- a/crates/outline/src/outline.rs
+++ b/crates/outline/src/outline.rs
@@ -231,10 +231,14 @@ impl OutlineViewDelegate {
 
         cx: &mut Context<Picker<OutlineViewDelegate>>,
     ) {
+        let Some(selected_match) = self.matches.get(ix) else {
+            self.selected_match_index = self.matches.len();
+            return;
+        };
+
         self.selected_match_index = ix;
 
-        if navigate && !self.matches.is_empty() {
-            let selected_match = &self.matches[self.selected_match_index];
+        if navigate {
             let outline_item = &self.outline.items[selected_match.candidate_id];
 
             self.active_editor.update(cx, |active_editor, cx| {
@@ -269,6 +273,10 @@ impl PickerDelegate for OutlineViewDelegate {
         self.selected_match_index
     }
 
+    fn can_select(&self, ix: usize, _window: &mut Window, _cx: &mut Context<Picker<Self>>) -> bool {
+        ix < self.matches.len()
+    }
+
     fn set_selected_index(
         &mut self,
         ix: usize,
@@ -704,6 +712,70 @@ mod tests {
         );
     }
 
+    #[gpui::test]
+    async fn test_outline_stale_hover_index_after_matches_shrink(cx: &mut TestAppContext) {
+        init_test(cx);
+
+        let mut source = String::new();
+        for index in 0..69 {
+            source.push_str(&format!("struct Keep{index};\n"));
+        }
+        for index in 69..74 {
+            source.push_str(&format!("struct Drop{index};\n"));
+        }
+
+        let fs = FakeFs::new(cx.executor());
+        fs.insert_tree(path!("/dir"), json!({ "a.rs": source }))
+            .await;
+
+        let project = Project::test(fs, [path!("/dir").as_ref()], cx).await;
+        project.read_with(cx, |project, _| {
+            project.languages().add(language::rust_lang())
+        });
+
+        let (workspace, cx) =
+            cx.add_window_view(|window, cx| MultiWorkspace::test_new(project.clone(), window, cx));
+
+        let workspace = cx.read(|cx| workspace.read(cx).workspace().clone());
+        let worktree_id = workspace.update(cx, |workspace, cx| {
+            workspace.project().update(cx, |project, cx| {
+                project.worktrees(cx).next().unwrap().read(cx).id()
+            })
+        });
+        let _buffer = project
+            .update(cx, |project, cx| {
+                project.open_local_buffer(path!("/dir/a.rs"), cx)
+            })
+            .await
+            .unwrap();
+        workspace
+            .update_in(cx, |workspace, window, cx| {
+                workspace.open_path((worktree_id, rel_path("a.rs")), None, true, window, cx)
+            })
+            .await
+            .unwrap();
+
+        let outline_view = open_outline_view(&workspace, cx);
+        outline_view.read_with(cx, |outline_view, _| {
+            assert_eq!(outline_view.delegate.matches.len(), 74);
+        });
+
+        outline_view
+            .update_in(cx, |outline_view, window, cx| {
+                outline_view
+                    .delegate
+                    .update_matches("Keep".to_string(), window, cx)
+            })
+            .await;
+        outline_view.read_with(cx, |outline_view, _| {
+            assert_eq!(outline_view.delegate.matches.len(), 69);
+        });
+
+        outline_view.update_in(cx, |outline_view, window, cx| {
+            outline_view.set_selected_index(73, None, false, window, cx);
+        });
+    }
+
     #[gpui::test]
     async fn test_outline_filtered_selection_prefers_first_match_on_score_ties(
         cx: &mut TestAppContext,