diff --git a/crates/gpui/src/interactive.rs b/crates/gpui/src/interactive.rs
index 6fc7cfc8e8..0be917350d 100644
--- a/crates/gpui/src/interactive.rs
+++ b/crates/gpui/src/interactive.rs
@@ -307,7 +307,10 @@ mod test {
             div().id("testview").child(
                 div()
                     .key_context("parent")
-                    .on_key_down(cx.listener(|this, _, _| this.saw_key_down = true))
+                    .on_key_down(cx.listener(|this, _, cx| {
+                        cx.stop_propagation();
+                        this.saw_key_down = true
+                    }))
                     .on_action(
                         cx.listener(|this: &mut TestView, _: &TestAction, _| {
                             this.saw_action = true
@@ -343,6 +346,7 @@ mod test {
             .update(cx, |test_view, cx| cx.focus(&test_view.focus_handle))
             .unwrap();
 
+        cx.dispatch_keystroke(*window, Keystroke::parse("a").unwrap(), false);
         cx.dispatch_keystroke(*window, Keystroke::parse("ctrl-g").unwrap(), false);
 
         window
diff --git a/crates/gpui/src/window.rs b/crates/gpui/src/window.rs
index 7b6541c937..71e6cb9e55 100644
--- a/crates/gpui/src/window.rs
+++ b/crates/gpui/src/window.rs
@@ -1583,36 +1583,16 @@ impl<'a> WindowContext<'a> {
 
         let mut actions: Vec<Box<dyn Action>> = Vec::new();
 
-        // Capture phase
         let mut context_stack: SmallVec<[KeyContext; 16]> = SmallVec::new();
-        self.propagate_event = true;
-
         for node_id in &dispatch_path {
             let node = self.window.rendered_frame.dispatch_tree.node(*node_id);
 
             if let Some(context) = node.context.clone() {
                 context_stack.push(context);
             }
-
-            for key_listener in node.key_listeners.clone() {
-                key_listener(event, DispatchPhase::Capture, self);
-                if !self.propagate_event {
-                    return;
-                }
-            }
         }
 
-        // Bubble phase
         for node_id in dispatch_path.iter().rev() {
-            // Handle low level key events
-            let node = self.window.rendered_frame.dispatch_tree.node(*node_id);
-            for key_listener in node.key_listeners.clone() {
-                key_listener(event, DispatchPhase::Bubble, self);
-                if !self.propagate_event {
-                    return;
-                }
-            }
-
             // Match keystrokes
             let node = self.window.rendered_frame.dispatch_tree.node(*node_id);
             if node.context.is_some() {
@@ -1633,6 +1613,7 @@ impl<'a> WindowContext<'a> {
             self.clear_pending_keystrokes();
         }
 
+        self.propagate_event = true;
         for action in actions {
             self.dispatch_action_on_node(node_id, action.boxed_clone());
             if !self.propagate_event {
@@ -1640,6 +1621,31 @@ impl<'a> WindowContext<'a> {
                 return;
             }
         }
+
+        // Capture phase
+        for node_id in &dispatch_path {
+            let node = self.window.rendered_frame.dispatch_tree.node(*node_id);
+
+            for key_listener in node.key_listeners.clone() {
+                key_listener(event, DispatchPhase::Capture, self);
+                if !self.propagate_event {
+                    return;
+                }
+            }
+        }
+
+        // Bubble phase
+        for node_id in dispatch_path.iter().rev() {
+            // Handle low level key events
+            let node = self.window.rendered_frame.dispatch_tree.node(*node_id);
+            for key_listener in node.key_listeners.clone() {
+                key_listener(event, DispatchPhase::Bubble, self);
+                if !self.propagate_event {
+                    return;
+                }
+            }
+        }
+
         self.dispatch_keystroke_observers(event, None);
     }
 
diff --git a/crates/terminal/src/terminal.rs b/crates/terminal/src/terminal.rs
index 70fceae66a..d43508bdbe 100644
--- a/crates/terminal/src/terminal.rs
+++ b/crates/terminal/src/terminal.rs
@@ -62,15 +62,7 @@ use lazy_static::lazy_static;
 
 actions!(
     terminal,
-    [
-        Clear,
-        Copy,
-        Paste,
-        ShowCharacterPalette,
-        SearchTest,
-        SendText,
-        SendKeystroke,
-    ]
+    [Clear, Copy, Paste, ShowCharacterPalette, SearchTest,]
 );
 
 ///Scrolling is unbearably sluggish by default. Alacritty supports a configurable
diff --git a/crates/terminal_view/src/terminal_view.rs b/crates/terminal_view/src/terminal_view.rs
index 521efef790..d519523974 100644
--- a/crates/terminal_view/src/terminal_view.rs
+++ b/crates/terminal_view/src/terminal_view.rs
@@ -57,7 +57,7 @@ pub struct SendText(String);
 #[derive(Clone, Debug, Default, Deserialize, PartialEq)]
 pub struct SendKeystroke(String);
 
-impl_actions!(terminal_view, [SendText, SendKeystroke]);
+impl_actions!(terminal, [SendText, SendKeystroke]);
 
 pub fn init(cx: &mut AppContext) {
     terminal_panel::init(cx);