diff --git a/package.json b/package.json
index 5a70951010..dcd719f34c 100644
--- a/package.json
+++ b/package.json
@@ -92,7 +92,11 @@
             "last 2 Edge versions",
             "last 2 iOS versions"
         ],
-        "development": ["last 1 Chrome versions", "last 1 Firefox versions", "last 1 Safari versions"]
+        "development": [
+            "last 1 Chrome versions",
+            "last 1 Firefox versions",
+            "last 1 Safari versions"
+        ]
     },
     "husky": {
         "hooks": {
@@ -128,7 +132,7 @@
         "@box/cldr-data": "^34.2.0",
         "@box/frontend": "^10.0.0",
         "@box/languages": "^1.0.0",
-        "@box/metadata-editor": "^0.54.0",
+        "@box/metadata-editor": "^0.61.1",
         "@box/react-virtualized": "9.22.3-rc-box.9",
         "@cfaester/enzyme-adapter-react-18": "^0.8.0",
         "@chromatic-com/storybook": "^1.6.1",
@@ -306,7 +310,7 @@
         "@box/blueprint-web-assets": "^4.21.0",
         "@box/box-ai-content-answers": "^0.50.5",
         "@box/cldr-data": ">=34.2.0",
-        "@box/metadata-editor": "^0.54.0",
+        "@box/metadata-editor": "^0.61.1",
         "@box/react-virtualized": "9.22.3-rc-box.9",
         "@hapi/address": "^2.1.4",
         "axios": "^0.25.0",
@@ -366,6 +370,8 @@
         }
     },
     "msw": {
-        "workerDirectory": [".storybook/public"]
+        "workerDirectory": [
+            ".storybook/public"
+        ]
     }
 }
diff --git a/src/elements/content-sidebar/MetadataInstanceEditor.tsx b/src/elements/content-sidebar/MetadataInstanceEditor.tsx
index d03839e06e..f801d1e1ad 100644
--- a/src/elements/content-sidebar/MetadataInstanceEditor.tsx
+++ b/src/elements/content-sidebar/MetadataInstanceEditor.tsx
@@ -16,7 +16,7 @@ export interface MetadataInstanceEditorProps {
     template: MetadataTemplateInstance;
     onSubmit: (values: FormValues, operations: JSONPatchOperations) => Promise<void>;
     setIsUnsavedChangesModalOpen: (isUnsavedChangesModalOpen: boolean) => void;
-    onUnsavedChangesModalCancel: () => void;
+    onDiscardUnsavedChanges: () => void;
 }
 
 const MetadataInstanceEditor: React.FC<MetadataInstanceEditorProps> = ({
@@ -28,15 +28,19 @@ const MetadataInstanceEditor: React.FC<MetadataInstanceEditorProps> = ({
     setIsUnsavedChangesModalOpen,
     template,
     onCancel,
-    onUnsavedChangesModalCancel,
+    onDiscardUnsavedChanges,
 }) => {
     const handleCancel = () => {
         onCancel();
     };
 
     return (
-        <AutofillContextProvider isAiSuggestionsFeatureEnabled={isBoxAiSuggestionsEnabled}>
+        <AutofillContextProvider
+            fetchSuggestions={() => Promise.resolve([])}
+            isAiSuggestionsFeatureEnabled={isBoxAiSuggestionsEnabled}
+        >
             <MetadataInstanceForm
+                areAiSuggestionsAvailable={true}
                 isAiSuggestionsFeatureEnabled={isBoxAiSuggestionsEnabled}
                 isDeleteButtonDisabled={isDeleteButtonDisabled}
                 isUnsavedChangesModalOpen={isUnsavedChangesModalOpen}
@@ -45,7 +49,7 @@ const MetadataInstanceEditor: React.FC<MetadataInstanceEditorProps> = ({
                 onSubmit={onSubmit}
                 setIsUnsavedChangesModalOpen={setIsUnsavedChangesModalOpen}
                 onDelete={onDelete}
-                onUnsavedChangesModalCancel={onUnsavedChangesModalCancel}
+                onDiscardUnsavedChanges={onDiscardUnsavedChanges}
             />
         </AutofillContextProvider>
     );
diff --git a/src/elements/content-sidebar/MetadataSidebarRedesign.tsx b/src/elements/content-sidebar/MetadataSidebarRedesign.tsx
index 1fdb50157d..9addb817bd 100644
--- a/src/elements/content-sidebar/MetadataSidebarRedesign.tsx
+++ b/src/elements/content-sidebar/MetadataSidebarRedesign.tsx
@@ -93,15 +93,25 @@ function MetadataSidebarRedesign({
     const [pendingTemplateToEdit, setPendingTemplateToEdit] = React.useState<MetadataTemplateInstance | null>(null);
 
     React.useEffect(() => {
-        setSelectedTemplates(templateInstances);
-    }, [templateInstances, templateInstances.length]);
+        // disable only pre-existing template instances from dropdown if not editing or editing pre-exiting one
+        const isEditingTemplateAlreadyExisting =
+            editingTemplate &&
+            templateInstances.some(
+                t => t.templateKey === editingTemplate.templateKey && t.scope === editingTemplate.scope,
+            );
+
+        if (!editingTemplate || isEditingTemplateAlreadyExisting) {
+            setSelectedTemplates(templateInstances);
+        } else {
+            setSelectedTemplates([...templateInstances, editingTemplate]);
+        }
+    }, [editingTemplate, templateInstances, templateInstances.length]);
 
     const handleTemplateSelect = (selectedTemplate: MetadataTemplate) => {
         if (editingTemplate) {
             setPendingTemplateToEdit(convertTemplateToTemplateInstance(file, selectedTemplate));
             setIsUnsavedChangesModalOpen(true);
         } else {
-            setSelectedTemplates([...selectedTemplates, selectedTemplate]);
             setEditingTemplate(convertTemplateToTemplateInstance(file, selectedTemplate));
             setIsDeleteButtonDisabled(true);
         }
@@ -109,21 +119,20 @@ function MetadataSidebarRedesign({
 
     const handleCancel = () => {
         setEditingTemplate(null);
-        setSelectedTemplates(templateInstances);
     };
 
-    const handleCancelUnsavedChanges = () => {
+    const handleDiscardUnsavedChanges = () => {
         // check if user tried to edit another template before unsaved changes modal
         if (pendingTemplateToEdit) {
             setEditingTemplate(pendingTemplateToEdit);
-            setSelectedTemplates([...templateInstances, pendingTemplateToEdit]);
             setIsDeleteButtonDisabled(true);
 
             setPendingTemplateToEdit(null);
-            setIsUnsavedChangesModalOpen(false);
         } else {
             handleCancel();
         }
+
+        setIsUnsavedChangesModalOpen(false);
     };
 
     const handleDeleteInstance = async (metadataInstance: MetadataTemplateInstance) => {
@@ -190,7 +199,7 @@ function MetadataSidebarRedesign({
                         isDeleteButtonDisabled={isDeleteButtonDisabled}
                         isUnsavedChangesModalOpen={isUnsavedChangesModalOpen}
                         onCancel={handleCancel}
-                        onUnsavedChangesModalCancel={handleCancelUnsavedChanges}
+                        onDiscardUnsavedChanges={handleDiscardUnsavedChanges}
                         onSubmit={handleSubmit}
                         onDelete={handleDeleteInstance}
                         template={editingTemplate}
diff --git a/src/elements/content-sidebar/__tests__/MetadataInstanceEditor.test.tsx b/src/elements/content-sidebar/__tests__/MetadataInstanceEditor.test.tsx
index a16ee03ba6..45e6be2ad7 100644
--- a/src/elements/content-sidebar/__tests__/MetadataInstanceEditor.test.tsx
+++ b/src/elements/content-sidebar/__tests__/MetadataInstanceEditor.test.tsx
@@ -5,7 +5,7 @@ import { screen, render } from '../../../test-utils/testing-library';
 import MetadataInstanceEditor, { MetadataInstanceEditorProps } from '../MetadataInstanceEditor';
 
 const mockOnCancel = jest.fn();
-const mockOnUnsavedChangesModalCancel = jest.fn();
+const mockOnDiscardUnsavedChanges = jest.fn();
 const mockSetIsUnsavedChangesModalOpen = jest.fn();
 
 describe('MetadataInstanceEditor', () => {
@@ -57,7 +57,7 @@ describe('MetadataInstanceEditor', () => {
         onDelete: jest.fn(),
         onSubmit: jest.fn(),
         setIsUnsavedChangesModalOpen: mockSetIsUnsavedChangesModalOpen,
-        onUnsavedChangesModalCancel: mockOnUnsavedChangesModalCancel,
+        onDiscardUnsavedChanges: mockOnDiscardUnsavedChanges,
     };
 
     test('should render MetadataInstanceForm with correct props', () => {
@@ -108,7 +108,7 @@ describe('MetadataInstanceEditor', () => {
         expect(mockOnCancel).toHaveBeenCalled();
     });
 
-    test('Should call onUnsavedChangesModalCancel instead onCancel when canceling through UnsavedChangesModal', async () => {
+    test('Should call onDiscardUnsavedChanges instead onCancel when canceling through UnsavedChangesModal', async () => {
         const props: MetadataInstanceEditorProps = {
             ...defaultProps,
             template: mockCustomMetadataTemplateWithField,
@@ -127,10 +127,10 @@ describe('MetadataInstanceEditor', () => {
         const unsavedChangesModal = await findByText('Unsaved Changes');
 
         expect(unsavedChangesModal).toBeInTheDocument();
-        const unsavedChangesModalCancelButton = await findByRole('button', { name: 'Cancel' });
+        const unsavedChangesModalDiscardButton = await findByRole('button', { name: 'Discard Changes' });
 
-        await userEvent.click(unsavedChangesModalCancelButton);
+        await userEvent.click(unsavedChangesModalDiscardButton);
 
-        expect(mockOnUnsavedChangesModalCancel).toHaveBeenCalled();
+        expect(mockOnDiscardUnsavedChanges).toHaveBeenCalled();
     });
 });
diff --git a/src/elements/content-sidebar/stories/tests/MetadataSidebarRedesign-visual.stories.tsx b/src/elements/content-sidebar/stories/tests/MetadataSidebarRedesign-visual.stories.tsx
index 440853d26a..09d555ff7e 100644
--- a/src/elements/content-sidebar/stories/tests/MetadataSidebarRedesign-visual.stories.tsx
+++ b/src/elements/content-sidebar/stories/tests/MetadataSidebarRedesign-visual.stories.tsx
@@ -278,3 +278,60 @@ export const MetadataInstanceEditorAddTemplateAgainAfterCancel: StoryObj<typeof
         expect(templateMetadataOptionEnabled).not.toHaveAttribute('aria-disabled');
     },
 };
+
+export const SwitchEditingTemplateInstances: StoryObj<typeof MetadataSidebarRedesign> = {
+    args: {
+        fileId: '416047501580',
+        metadataSidebarProps: defaultMetadataSidebarProps,
+    },
+    play: async ({ canvasElement }) => {
+        const canvas = within(canvasElement);
+
+        // open and edit a new template
+        const addTemplateButton = await canvas.findByRole('button', { name: 'Add template' }, { timeout: 5000 });
+
+        await userEvent.click(addTemplateButton);
+
+        const templateMetadataOption = canvas.getByRole('option', { name: 'My Template' });
+
+        await userEvent.click(templateMetadataOption);
+
+        const input = await canvas.findByRole('textbox');
+
+        await userEvent.type(input, 'Lorem ipsum dolor.');
+
+        // open another template while editing the first one (with discarding changes)
+        await userEvent.click(addTemplateButton);
+
+        const templateMetadataOptionA = canvas.getByRole('option', { name: 'My Template' });
+        const templateMetadataOptionB = canvas.getByRole('option', { name: 'Virus Scan' });
+
+        expect(templateMetadataOptionA).toHaveAttribute('aria-disabled');
+        expect(templateMetadataOptionB).not.toHaveAttribute('aria-disabled');
+
+        await userEvent.click(templateMetadataOptionB);
+
+        const unsavedChangesModal = await screen.findByRole(
+            'heading',
+            { level: 2, name: 'Unsaved Changes' },
+            { timeout: 5000 },
+        );
+        expect(unsavedChangesModal).toBeInTheDocument();
+
+        const unsavedChangesModalDiscardButton = await screen.findByRole('button', { name: 'Discard Changes' });
+
+        await userEvent.click(unsavedChangesModalDiscardButton);
+
+        const newTemplateHeader = await canvas.findByRole('heading', { name: 'Virus Scan' });
+        expect(newTemplateHeader).toBeInTheDocument();
+
+        // check if template buttons disabled correctly after switching editors
+        await userEvent.click(addTemplateButton);
+
+        const templateMetadataOptionAAfterSwitch = canvas.getByRole('option', { name: 'My Template' });
+        const templateMetadataOptionBAfterSwitch = canvas.getByRole('option', { name: 'Virus Scan' });
+
+        expect(templateMetadataOptionAAfterSwitch).not.toHaveAttribute('aria-disabled');
+        expect(templateMetadataOptionBAfterSwitch).toHaveAttribute('aria-disabled');
+    },
+};
diff --git a/src/test-utils/testing-library.tsx b/src/test-utils/testing-library.tsx
index d42dc1a266..c8014de528 100644
--- a/src/test-utils/testing-library.tsx
+++ b/src/test-utils/testing-library.tsx
@@ -9,7 +9,7 @@ import { AutofillContextProvider } from '@box/metadata-editor';
 jest.unmock('react-intl');
 
 const Wrapper = ({ children }) => (
-    <AutofillContextProvider isAiSuggestionsFeatureEnabled={false}>
+    <AutofillContextProvider isAiSuggestionsFeatureEnabled={false} fetchSuggestions={() => Promise.resolve([])}>
         <TooltipProvider>
             <IntlProvider locale="en">{children}</IntlProvider>
         </TooltipProvider>
diff --git a/yarn.lock b/yarn.lock
index 1ec64e09e3..ac7f49aae7 100644
--- a/yarn.lock
+++ b/yarn.lock
@@ -1569,10 +1569,10 @@
   resolved "https://registry.yarnpkg.com/@box/languages/-/languages-1.1.2.tgz#cd4266b3da62da18560d881e10b429653186be29"
   integrity sha512-d64TGosx+KRmrLZj4CIyLp42LUiEbgBJ8n8cviMQwTJmfU0g+UwZqLjmQZR1j+Q9D64yV4xHzY9K1t5nInWWeQ==
 
-"@box/metadata-editor@^0.54.0":
-  version "0.54.0"
-  resolved "https://registry.yarnpkg.com/@box/metadata-editor/-/metadata-editor-0.54.0.tgz#699266252fca2b776eb9df814b158d988e719f01"
-  integrity sha512-Og7w6DsoDoXpuujDcnrlTWiTmVONuuWDwDitcrXflNkxsx9ZVvgTFwKD9SVj2yW5HjMM5X46X1qHYDe40qDXkg==
+"@box/metadata-editor@^0.61.1":
+  version "0.61.2"
+  resolved "https://registry.yarnpkg.com/@box/metadata-editor/-/metadata-editor-0.61.2.tgz#b8e66f3e822531ae57463cfdd8be89dd9cabdb21"
+  integrity sha512-Ot+cGU+benO0ChRrKWahvJmHMgxKTp4nuNr+VypnQtTt63hGCn1F8TbZ2aQNRtPikhoGCAiOwYspG8fRKJ/Fmw==
 
 "@box/react-virtualized@9.22.3-rc-box.9":
   version "9.22.3-rc-box.9"