diff --git a/docs/src/pages/components/Popover.svx b/docs/src/pages/components/Popover.svx
index 03f1da78..d756b572 100644
--- a/docs/src/pages/components/Popover.svx
+++ b/docs/src/pages/components/Popover.svx
@@ -36,6 +36,12 @@ Set `closeOnOutsideClick` to set `open` to `false` when clicking outside of the
     </Popover>
 </div>
 
+## Manage open state with a Button
+
+You can bind the `open` prop and manage the open state of the popover with an external button.
+
+<FileSource src="/framed/Popover/WithButton" />
+
 ## Popover alignment
 
 Customize the popover alignment using the `align` prop. Valid values include: `"top" | "top-left" | "top-right" | "bottom" | "bottom-left" | "bottom-right" | "left" | "left-bottom" | "left-top" | "right" | "right-bottom" | "right-top"`.
diff --git a/docs/src/pages/framed/Popover/WithButton.svelte b/docs/src/pages/framed/Popover/WithButton.svelte
new file mode 100644
index 00000000..fd3b6951
--- /dev/null
+++ b/docs/src/pages/framed/Popover/WithButton.svelte
@@ -0,0 +1,37 @@
+<script>
+  import { Popover, Button } from "carbon-components-svelte";
+
+  let open = true;
+  let containerRef = null;
+</script>
+
+<div data-outline>
+  <div
+    bind:this="{containerRef}"
+    style:position="relative"
+    style:display="inline-block"
+  >
+    <Button on:click="{() => (open = !open)}">Click to open</Button>
+    <Popover
+      bind:open
+      align="bottom-left"
+      on:click:outside="{({ detail }) => {
+        console.log('on:click:outside');
+        if (!containerRef.contains(detail.target)) {
+          open = false;
+        }
+      }}"
+    >
+      <div style="padding: var(--cds-spacing-05)">Content</div>
+    </Popover>
+  </div>
+  <div>
+    <br />
+    Anim eu laboris veniam in est elit ullamco enim irure id. Lorem est culpa ex
+    in enim enim. Culpa quis incididunt magna officia et aliqua. Ullamco deserunt
+    aute enim cupidatat. Culpa quis enim sint sint anim qui irure exercitation labore
+    occaecat in reprehenderit proident. Nisi laborum ut et amet commodo amet ullamco
+    commodo non aliqua magna ad eu. Ad aliquip minim nostrud id enim elit velit ullamco
+    pariatur eu excepteur pariatur cillum.
+  </div>
+</div>
diff --git a/src/Popover/Popover.svelte b/src/Popover/Popover.svelte
index 2287a72d..c26bc525 100644
--- a/src/Popover/Popover.svelte
+++ b/src/Popover/Popover.svelte
@@ -33,8 +33,8 @@
 <svelte:window
   on:click="{(e) => {
     if (!open) return;
-    if (e.target.contains(ref)) {
-      dispatch('click:outside');
+    if (!ref.contains(e.target)) {
+      dispatch('click:outside', { target: e.target });
       if (closeOnOutsideClick) open = false;
     }
   }}"
diff --git a/types/Popover/Popover.svelte.d.ts b/types/Popover/Popover.svelte.d.ts
index 7e6f12b3..bbb90eda 100644
--- a/types/Popover/Popover.svelte.d.ts
+++ b/types/Popover/Popover.svelte.d.ts
@@ -60,6 +60,6 @@ export interface PopoverProps
 
 export default class Popover extends SvelteComponentTyped<
   PopoverProps,
-  { ["click:outside"]: CustomEvent<null> },
+  { ["click:outside"]: CustomEvent<{ target: HTMLElement }> },
   { default: {} }
 > {}