diff --git a/package.json b/package.json
index 59ef717b2..8e835c24f 100644
--- a/package.json
+++ b/package.json
@@ -129,7 +129,7 @@
     "react-ace": "^11.0.1",
     "react-dom": "18.2.0",
     "react-router-dom": "6.15.0",
-    "react-window": "1.8.9",
+    "react-window": "1.8.11",
     "recharts": "^2.9.0",
     "sanitize-html": "2.12.1",
     "styled-components": "^6.1.13",
diff --git a/src/components/form/ComboBox/ComboBox.tsx b/src/components/form/ComboBox/ComboBox.tsx
index 98b22e702..083fd8682 100644
--- a/src/components/form/ComboBox/ComboBox.tsx
+++ b/src/components/form/ComboBox/ComboBox.tsx
@@ -1,12 +1,10 @@
 import { Autocomplete, createFilterOptions } from '@mui/material'
 import _sortBy from 'lodash/sortBy'
 import { useEffect, useMemo, useRef } from 'react'
-import styled from 'styled-components'
 
 import { Skeleton } from '~/components/designSystem'
 import { useInternationalization } from '~/hooks/core/useInternationalization'
 import { useDebouncedSearch } from '~/hooks/useDebouncedSearch'
-import { theme } from '~/styles'
 
 import { ComboBoxInput } from './ComboBoxInput'
 import { ComboBoxItem } from './ComboBoxItem'
@@ -132,14 +130,17 @@ export const ComboBox = ({
       value={value || null}
       loading={isLoading}
       loadingText={
-        <LoadingIemsWrapper>
+        <div className="my-4 flex flex-col gap-8">
           {[1, 2, 3].map((i) => (
-            <LoadingItem key={`combobox-loading-item-${i}`}>
+            <div
+              className="mx-2 flex items-center justify-between px-4"
+              key={`combobox-loading-item-${i}`}
+            >
               <Skeleton variant="circular" size="small" className="mr-4" />
               <Skeleton variant="text" />
-            </LoadingItem>
+            </div>
           ))}
-        </LoadingIemsWrapper>
+        </div>
       }
       noOptionsText={emptyText ?? translate('text_623b3acb8ee4e000ba87d082')}
       selectOnFocus={allowAddValue}
@@ -213,19 +214,3 @@ export const ComboBox = ({
     />
   )
 }
-
-const LoadingIemsWrapper = styled.div`
-  margin: ${theme.spacing(4)} 0;
-  display: flex;
-  flex-direction: column;
-  gap: ${theme.spacing(8)};
-`
-
-const LoadingItem = styled.div`
-  display: flex;
-  align-items: center;
-  justify-content: space-between;
-  box-sizing: border-box;
-  margin: 0 ${theme.spacing(2)};
-  padding: 0 ${theme.spacing(4)};
-`
diff --git a/src/components/form/ComboBox/ComboBoxInput.tsx b/src/components/form/ComboBox/ComboBoxInput.tsx
index 3a216889c..e270dce62 100644
--- a/src/components/form/ComboBox/ComboBoxInput.tsx
+++ b/src/components/form/ComboBox/ComboBoxInput.tsx
@@ -1,9 +1,7 @@
 import { InputAdornment } from '@mui/material'
 import _omit from 'lodash/omit'
-import styled from 'styled-components'
 
 import { Button, Typography } from '~/components/designSystem'
-import { theme } from '~/styles'
 import { tw } from '~/styles/utils'
 
 import { ComboBoxInputProps } from './types'
@@ -84,10 +82,10 @@ export const ComboBoxInput = ({
         ),
         startAdornment: startAdornmentValue && (
           <InputAdornment position="start">
-            <StartAdornmentTypography noWrap variant="body" color="grey700">
-              <span>{startAdornmentValue}</span>
+            <Typography noWrap variant="body" color="grey700">
+              <span className="mr-2">{startAdornmentValue}</span>
               <span>•</span>
-            </StartAdornmentTypography>
+            </Typography>
           </InputAdornment>
         ),
       }}
@@ -96,9 +94,3 @@ export const ComboBoxInput = ({
     />
   )
 }
-
-const StartAdornmentTypography = styled(Typography)`
-  > span:first-child {
-    margin-right: ${theme.spacing(2)};
-  }
-`
diff --git a/src/components/form/ComboBox/ComboBoxItem.tsx b/src/components/form/ComboBox/ComboBoxItem.tsx
index 4f01d9ac7..2d3daeb4d 100644
--- a/src/components/form/ComboBox/ComboBoxItem.tsx
+++ b/src/components/form/ComboBox/ComboBoxItem.tsx
@@ -54,7 +54,7 @@ export const ComboBoxItem = ({
         >
           {customValue ? (
             <>
-              <AddCustomValueIcon color="dark" name="plus" />
+              <Icon className="mr-4" color="dark" name="plus" />
               <Typography variant="body" noWrap>
                 {labelNode ?? label}
               </Typography>
@@ -99,10 +99,6 @@ const ItemWrapper = styled.div`
   }
 `
 
-const AddCustomValueIcon = styled(Icon)`
-  margin-right: ${theme.spacing(4)};
-`
-
 export const Item = styled.div<{ $virtualized?: boolean }>`
   display: flex;
   align-items: center;
diff --git a/src/components/form/ComboBox/ComboBoxPopperFactory.tsx b/src/components/form/ComboBox/ComboBoxPopperFactory.tsx
index 269e924d5..697f263aa 100644
--- a/src/components/form/ComboBox/ComboBoxPopperFactory.tsx
+++ b/src/components/form/ComboBox/ComboBoxPopperFactory.tsx
@@ -67,11 +67,6 @@ const StyledPopper = styled(Popper)<{
 
   .MuiAutocomplete-paper {
     border: 1px solid ${theme.palette.grey[200]};
-    padding: ${theme.spacing(2)} 0;
     box-sizing: content-box;
   }
-
-  > *.combobox-popper--grouped .MuiAutocomplete-paper {
-    padding: 0 0 ${theme.spacing(2)} 0;
-  }
 `
diff --git a/src/components/form/ComboBox/ComboBoxVirtualizedList.tsx b/src/components/form/ComboBox/ComboBoxVirtualizedList.tsx
index 47f6c1952..565f57c3c 100644
--- a/src/components/form/ComboBox/ComboBoxVirtualizedList.tsx
+++ b/src/components/form/ComboBox/ComboBoxVirtualizedList.tsx
@@ -1,6 +1,8 @@
 import { ReactElement, useEffect, useRef } from 'react'
 import { VariableSizeList } from 'react-window'
 
+import { tw } from '~/styles/utils'
+
 import { ITEM_HEIGHT } from './ComboBoxItem'
 import { ComboBoxProps } from './types'
 
@@ -25,19 +27,18 @@ type ComboBoxVirtualizedListProps = {
 export const ComboBoxVirtualizedList = (props: ComboBoxVirtualizedListProps) => {
   const { elements, value } = props
 
-  const hasDescription = elements.some(
-    (el) => (el.props?.children?.props?.option?.description as string)?.length > 0,
-  )
-
   const itemCount = elements?.length
-  const elementHeight = hasDescription ? ITEM_HEIGHT + 4 : ITEM_HEIGHT
 
   const getHeight = () => {
+    const hasAnyGroupHeader = elements.some((el) => (el.key as string).includes(GROUP_ITEM_KEY))
+
     // recommended perf best practice
     if (itemCount > 5) {
-      return 5 * (elementHeight + 4) - 4 // Last item does not have 4px margin-bottom
+      return 5 * (ITEM_HEIGHT + 4) + 4 // Add 4px for margins
+    } else if (itemCount <= 2 && hasAnyGroupHeader) {
+      return itemCount * (ITEM_HEIGHT + 2) // Add 2px for margins
     }
-    return itemCount * (elementHeight + 4) - 4 // Last item does not have 4px margin-bottom
+    return itemCount * (ITEM_HEIGHT + 4) + 4 // Add 4px for margins
   }
 
   // reset the `VariableSizeList` cache if data gets updated
@@ -63,6 +64,9 @@ export const ComboBoxVirtualizedList = (props: ComboBoxVirtualizedListProps) =>
 
   return (
     <VariableSizeList
+      className={tw({
+        'mb-1': itemCount > 1,
+      })}
       itemData={elements}
       height={getHeight()}
       width="100%"
@@ -70,10 +74,10 @@ export const ComboBoxVirtualizedList = (props: ComboBoxVirtualizedListProps) =>
       innerElementType="div"
       itemSize={(index) => {
         return index === itemCount - 1
-          ? elementHeight
+          ? ITEM_HEIGHT
           : ((elements[index].key as string) || '').includes(GROUP_ITEM_KEY)
-            ? GROUP_HEADER_HEIGHT + (index === 0 ? 8 : 12)
-            : elementHeight + 4
+            ? GROUP_HEADER_HEIGHT + (index === 0 ? 2 : 6)
+            : ITEM_HEIGHT + 8
       }}
       overscanCount={5}
       itemCount={itemCount}
diff --git a/src/components/form/ComboBox/ComboboxList.tsx b/src/components/form/ComboBox/ComboboxList.tsx
index 619882a26..92b0a57c6 100644
--- a/src/components/form/ComboBox/ComboboxList.tsx
+++ b/src/components/form/ComboBox/ComboboxList.tsx
@@ -1,15 +1,18 @@
 import _groupBy from 'lodash/groupBy'
-import { Children, ForwardedRef, forwardRef, ReactElement, ReactNode, useMemo } from 'react'
-import styled, { css } from 'styled-components'
+import {
+  Children,
+  ForwardedRef,
+  forwardRef,
+  PropsWithChildren,
+  ReactElement,
+  ReactNode,
+  useMemo,
+} from 'react'
 
 import { Typography } from '~/components/designSystem'
-import { theme } from '~/styles'
+import { tw } from '~/styles/utils'
 
-import {
-  ComboBoxVirtualizedList,
-  GROUP_HEADER_HEIGHT,
-  GROUP_ITEM_KEY,
-} from './ComboBoxVirtualizedList'
+import { ComboBoxVirtualizedList, GROUP_ITEM_KEY } from './ComboBoxVirtualizedList'
 import { ComboBoxData, ComboBoxProps } from './types'
 
 const randomKey = Math.round(Math.random() * 100000)
@@ -19,6 +22,27 @@ interface ComboBoxVirtualizedListProps
   children: ReactNode
 }
 
+const ComboboxListItem = ({
+  children,
+  virtualized,
+  className,
+  ...propsToForward
+}: { className?: string } & PropsWithChildren & ComboBoxVirtualizedListProps) => (
+  <div
+    className={tw(
+      'my-1',
+      {
+        'not-last:mx-2': virtualized,
+        'not-last:mx-0': !virtualized,
+      },
+      className,
+    )}
+    {...propsToForward}
+  >
+    {children}
+  </div>
+)
+
 export const ComboboxList = forwardRef(
   (
     {
@@ -36,9 +60,9 @@ export const ComboboxList = forwardRef(
       if (!isGrouped) {
         return Children.toArray(
           (children as ReactElement[]).map((item, i) => (
-            <Item key={`combobox-list-item-${randomKey}-${i}`} {...propsToForward}>
+            <ComboboxListItem key={`combobox-list-item-${randomKey}-${i}`} {...propsToForward}>
               {item}
-            </Item>
+            </ComboboxListItem>
           )),
         )
       }
@@ -60,22 +84,35 @@ export const ComboboxList = forwardRef(
               ...acc,
               isGrouped
                 ? [
-                    // If renderGroupHeader is provided, render the html, otherewise simply render the key
-                    <GroupHeader
+                    // If renderGroupHeader is provided, render the html, otherwise simply render the items
+                    <div
                       key={`${GROUP_ITEM_KEY}-${key}`}
-                      $isFirst={i === 0}
-                      $virtualized={virtualized}
+                      data-type={GROUP_ITEM_KEY}
+                      className={tw(
+                        'mx-0 my-1 flex h-11 w-[inherit] items-center bg-grey-100 px-6 py-0 shadow-[0px_-1px_0px_0px_#D9DEE7_inset,0px_-1px_0px_0px_#D9DEE7]',
+                        {
+                          '!mt-0': i === 0,
+                          'mb-1': virtualized,
+                          'sticky top-0 z-toast': !virtualized,
+                        },
+                      )}
                     >
                       {(!!renderGroupHeader && (renderGroupHeader[key] as ReactNode)) || (
                         <Typography noWrap>{key}</Typography>
                       )}
-                    </GroupHeader>,
+                    </div>,
                   ]
                 : [],
               ...(groupedBy[key] as ReactElement[]).map((item, j) => (
-                <Item key={`combobox-list-item-${randomKey}-${i}-${j}`} {...propsToForward}>
+                <ComboboxListItem
+                  key={`combobox-list-item-${randomKey}-${i}-${j}`}
+                  className={tw({
+                    'mt-1': i === 0 && !isGrouped,
+                  })}
+                  {...propsToForward}
+                >
                   {item}
-                </Item>
+                </ComboboxListItem>
               )),
             ]
           }, []),
@@ -83,59 +120,21 @@ export const ComboboxList = forwardRef(
     }, [isGrouped, renderGroupHeader, children, propsToForward, virtualized])
 
     return (
-      <Container ref={ref} role="listbox" $virtualized={virtualized}>
+      <div
+        className={tw('relative max-h-[inherit] overflow-auto pb-0', {
+          'overflow-hidden': virtualized,
+        })}
+        ref={ref}
+        role="listbox"
+      >
         {virtualized ? (
           <ComboBoxVirtualizedList value={value} elements={htmlItems as ReactElement[]} />
         ) : (
           htmlItems
         )}
-      </Container>
+      </div>
     )
   },
 )
 
 ComboboxList.displayName = 'ComboboxList'
-
-const Item = styled.div``
-
-const Container = styled.div<{ $virtualized?: boolean }>`
-  max-height: inherit;
-  position: relative;
-  padding-bottom: 0;
-  box-sizing: border-box;
-  overflow: ${({ $virtualized }) => ($virtualized ? 'hidden' : 'auto')};
-
-  .MuiAutocomplete-listbox {
-    max-height: inherit;
-  }
-
-  ${Item}:not(:last-child) {
-    margin: ${({ $virtualized }) =>
-      $virtualized ? `0 ${theme.spacing(2)}` : `0 0 ${theme.spacing(1)}`};
-  }
-`
-
-const GroupHeader = styled.div<{ $isFirst?: boolean; $virtualized?: boolean }>`
-  height: ${GROUP_HEADER_HEIGHT}px;
-  display: flex;
-  width: inherit;
-  align-items: center;
-  padding: 0 ${theme.spacing(6)};
-  background-color: ${theme.palette.grey[100]};
-  box-sizing: border-box;
-  box-shadow:
-    ${theme.shadows[7]},
-    0px -1px 0px 0px ${theme.palette.divider};
-
-  ${({ $virtualized, $isFirst }) =>
-    !$virtualized
-      ? css`
-          z-index: ${theme.zIndex.dialog + 2};
-          position: sticky;
-          top: 0;
-          margin: ${$isFirst ? 0 : theme.spacing(2)} 0 ${theme.spacing(2)};
-        `
-      : css`
-          margin: ${$isFirst ? 0 : theme.spacing(1)} 0 ${theme.spacing(2)};
-        `};
-`
diff --git a/src/components/form/MultipleComboBox/MultipleComboBoxList.tsx b/src/components/form/MultipleComboBox/MultipleComboBoxList.tsx
index b5bcd6c8c..47589e20b 100644
--- a/src/components/form/MultipleComboBox/MultipleComboBoxList.tsx
+++ b/src/components/form/MultipleComboBox/MultipleComboBoxList.tsx
@@ -106,10 +106,6 @@ const Container = styled.div<{ $virtualized?: boolean }>`
   box-sizing: border-box;
   overflow: ${({ $virtualized }) => ($virtualized ? 'hidden' : 'auto')};
 
-  .MuiAutocomplete-listbox {
-    max-height: inherit;
-  }
-
   ${Item}:not(:last-child) {
     margin: ${({ $virtualized }) =>
       $virtualized ? `0 ${theme.spacing(2)}` : `0 0 ${theme.spacing(1)}`};
diff --git a/src/styles/muiTheme.ts b/src/styles/muiTheme.ts
index 5f295828b..d5a5917b0 100644
--- a/src/styles/muiTheme.ts
+++ b/src/styles/muiTheme.ts
@@ -463,6 +463,7 @@ export const theme = createTheme({
           display: 'flex',
           flexDirection: 'column',
           gap: '4px',
+          maxHeight: 'inherit',
           padding: 0,
         },
         root: {
diff --git a/yarn.lock b/yarn.lock
index c70ec213c..143394c49 100644
--- a/yarn.lock
+++ b/yarn.lock
@@ -10669,10 +10669,10 @@ react-transition-group@^4.4.5:
     loose-envify "^1.4.0"
     prop-types "^15.6.2"
 
-react-window@1.8.9:
-  version "1.8.9"
-  resolved "https://registry.yarnpkg.com/react-window/-/react-window-1.8.9.tgz#24bc346be73d0468cdf91998aac94e32bc7fa6a8"
-  integrity sha512-+Eqx/fj1Aa5WnhRfj9dJg4VYATGwIUP2ItwItiJ6zboKWA6EX3lYDAXfGF2hyNqplEprhbtjbipiADEcwQ823Q==
+react-window@1.8.11:
+  version "1.8.11"
+  resolved "https://registry.yarnpkg.com/react-window/-/react-window-1.8.11.tgz#a857b48fa85bd77042d59cc460964ff2e0648525"
+  integrity sha512-+SRbUVT2scadgFSWx+R1P754xHPEqvcfSfVX10QYg6POOz+WNgkN48pS+BtZNIMGiL1HYrSEiCkwsMS15QogEQ==
   dependencies:
     "@babel/runtime" "^7.0.0"
     memoize-one ">=3.1.1 <6"