diff --git a/.changeset/slow-toes-fetch.md b/.changeset/slow-toes-fetch.md
new file mode 100644
index 0000000000..161a3e7d9e
--- /dev/null
+++ b/.changeset/slow-toes-fetch.md
@@ -0,0 +1,5 @@
+---
+"@medusajs/dashboard": patch
+---
+
+fix(dashboard): combobox initial item cache
diff --git a/packages/admin/dashboard/src/hooks/use-combobox-data.tsx b/packages/admin/dashboard/src/hooks/use-combobox-data.tsx
index 02e839b682..d49547790a 100644
--- a/packages/admin/dashboard/src/hooks/use-combobox-data.tsx
+++ b/packages/admin/dashboard/src/hooks/use-combobox-data.tsx
@@ -28,6 +28,7 @@ export const useComboboxData = <
   getOptions,
   defaultValue,
   defaultValueKey,
+  selectedValue,
   pageSize = 10,
   enabled = true,
 }: {
@@ -36,6 +37,7 @@ export const useComboboxData = <
   getOptions: (data: TResponse) => { label: string; value: string }[]
   defaultValueKey?: keyof TParams
   defaultValue?: string | string[]
+  selectedValue?: string
   pageSize?: number
   enabled?: boolean
 }) => {
@@ -43,7 +45,7 @@ export const useComboboxData = <
 
   const queryInitialDataBy = defaultValueKey || "id"
   const { data: initialData } = useQuery({
-    queryKey: queryKey,
+    queryKey: [...queryKey, defaultValue].filter(Boolean) as QueryKey,
     queryFn: async () => {
       return queryFn({
         [queryInitialDataBy]: defaultValue,
@@ -53,8 +55,21 @@ export const useComboboxData = <
     enabled: !!defaultValue && enabled,
   })
 
+  // always load selected value in case current data dosn't contain the value
+  const { data: selectedData } = useQuery({
+    queryKey: [...queryKey, selectedValue].filter(Boolean) as QueryKey,
+    queryFn: async () => {
+      return queryFn({
+        id: selectedValue,
+        limit: 1,
+      } as TParams)
+    },
+    enabled: !!selectedValue && enabled,
+  })
+
   const { data, ...rest } = useInfiniteQuery({
-    queryKey: [...queryKey, query],
+    // prevent infinite query response shape beeing stored under regualr list reponse QKs
+    queryKey: [...queryKey, "_cbx_", query].filter(Boolean) as QueryKey,
     queryFn: async ({ pageParam = 0 }) => {
       return await queryFn({
         q: query,
@@ -73,7 +88,7 @@ export const useComboboxData = <
 
   const options = data?.pages.flatMap((page) => getOptions(page)) ?? []
   const defaultOptions = initialData ? getOptions(initialData) : []
-
+  const selectedOptions = selectedData ? getOptions(selectedData) : []
   /**
    * If there are no options and the query is empty, then the combobox should be disabled,
    * as there is no data to search for.
@@ -90,6 +105,14 @@ export const useComboboxData = <
     })
   }
 
+  if (selectedValue && selectedOptions.length) {
+    selectedOptions.forEach((option) => {
+      if (!options.find((o) => o.value === option.value)) {
+        options.unshift(option)
+      }
+    })
+  }
+
   return {
     options,
     searchValue,
diff --git a/packages/admin/dashboard/src/routes/product-variants/product-variant-manage-inventory-items/components/manage-variant-inventory-items-form/manage-variant-inventory-items-form.tsx b/packages/admin/dashboard/src/routes/product-variants/product-variant-manage-inventory-items/components/manage-variant-inventory-items-form/manage-variant-inventory-items-form.tsx
index b7844f5dfa..3b4da809a1 100644
--- a/packages/admin/dashboard/src/routes/product-variants/product-variant-manage-inventory-items/components/manage-variant-inventory-items-form/manage-variant-inventory-items-form.tsx
+++ b/packages/admin/dashboard/src/routes/product-variants/product-variant-manage-inventory-items/components/manage-variant-inventory-items-form/manage-variant-inventory-items-form.tsx
@@ -3,7 +3,12 @@ import { XMarkMini } from "@medusajs/icons"
 import { AdminProductVariant, HttpTypes } from "@medusajs/types"
 import { Button, Heading, IconButton, Input, Label, toast } from "@medusajs/ui"
 import i18next from "i18next"
-import { useFieldArray, useForm, UseFormReturn } from "react-hook-form"
+import {
+  useFieldArray,
+  useForm,
+  UseFormReturn,
+  useWatch,
+} from "react-hook-form"
 import { useTranslation } from "react-i18next"
 import * as zod from "zod"
 
@@ -68,6 +73,10 @@ type VariantInventoryItemRowProps = {
     inventory_item_id: string
     required_quantity: number
   }
+  isItemOptionDisabled: (
+    option: { value: string },
+    inventoryIndex: number
+  ) => boolean
   onRemove: () => void
 }
 
@@ -75,14 +84,21 @@ function VariantInventoryItemRow({
   form,
   inventoryIndex,
   inventoryItem,
+  isItemOptionDisabled,
   onRemove,
 }: VariantInventoryItemRowProps) {
   const { t } = useTranslation()
 
+  const selectedInventoryItemId = useWatch({
+    control: form.control,
+    name: `inventory.${inventoryIndex}.inventory_item_id`,
+  })
+
   const items = useComboboxData({
     queryKey: ["inventory_items"],
     defaultValueKey: "id",
     defaultValue: inventoryItem.inventory_item_id,
+    selectedValue: selectedInventoryItemId,
     queryFn: (params) => sdk.admin.inventoryItem.list(params),
     getOptions: (data) =>
       data.inventory_items.map((item) => ({
@@ -117,7 +133,10 @@ function VariantInventoryItemRow({
                 <Form.Control>
                   <Combobox
                     {...field}
-                    options={items.options}
+                    options={items.options.map((o) => ({
+                      ...o,
+                      disabled: isItemOptionDisabled(o, inventoryIndex),
+                    }))}
                     searchValue={items.searchValue}
                     onSearchValueChange={items.onSearchValueChange}
                     onBlur={() => items.onSearchValueChange("")}
@@ -208,6 +227,24 @@ export function ManageVariantInventoryItemsForm({
     name: `inventory`,
   })
 
+  const inventoryFormData = useWatch({
+    control: form.control,
+    name: `inventory`,
+  })
+
+  /**
+   * Will mark an option as disabled if another input already selected that option
+   */
+  const isItemOptionDisabled = (
+    option: { value: string },
+    inventoryIndex: number
+  ) => {
+    return !!inventoryFormData?.some(
+      (i, index) =>
+        index != inventoryIndex && i.inventory_item_id === option.value
+    )
+  }
+
   const hasKit = inventory.fields.length > 1
 
   const { mutateAsync, isPending } = useProductVariantsInventoryItemsBatch(
@@ -272,10 +309,7 @@ export function ManageVariantInventoryItemsForm({
 
   return (
     <RouteFocusModal.Form form={form}>
-      <KeyboundForm
-        className="flex h-full flex-col overflow-hidden"
-        onSubmit={handleSubmit}
-      >
+      <KeyboundForm className="flex h-full flex-col" onSubmit={handleSubmit}>
         <RouteFocusModal.Header>
           <div className="flex items-center justify-end gap-x-2">
             <RouteFocusModal.Close asChild>
@@ -288,7 +322,7 @@ export function ManageVariantInventoryItemsForm({
             </Button>
           </div>
         </RouteFocusModal.Header>
-        <RouteFocusModal.Body className="flex justify-center">
+        <RouteFocusModal.Body className="flex justify-center overflow-auto">
           <div className="flex w-full flex-col gap-y-8 px-6 pt-12 md:w-[720px] md:pt-24">
             <Heading>
               {t(
@@ -298,7 +332,7 @@ export function ManageVariantInventoryItemsForm({
               )}
             </Heading>
 
-            <div className="grid gap-y-4">
+            <div className="grid gap-y-4 pb-8">
               <div className="flex items-start justify-between gap-x-4">
                 <div className="flex flex-col">
                   <Form.Label>{variant.title}</Form.Label>
@@ -330,6 +364,7 @@ export function ManageVariantInventoryItemsForm({
                   form={form}
                   inventoryIndex={inventoryIndex}
                   inventoryItem={inventoryItem}
+                  isItemOptionDisabled={isItemOptionDisabled}
                   onRemove={() => inventory.remove(inventoryIndex)}
                 />
               ))}