diff --git a/homeassistant/components/esphome/config_flow.py b/homeassistant/components/esphome/config_flow.py
index 61eb97a365b..550697d5d12 100644
--- a/homeassistant/components/esphome/config_flow.py
+++ b/homeassistant/components/esphome/config_flow.py
@@ -92,11 +92,6 @@ class EsphomeFlowHandler(ConfigFlow, domain=DOMAIN):
         self._name = entry.title
         self._device_name = entry.data.get(CONF_DEVICE_NAME)
 
-        if await self._retrieve_encryption_key_from_dashboard():
-            error = await self.fetch_device_info()
-            if error is None:
-                return await self._async_authenticate_or_add()
-
         return await self.async_step_reauth_confirm()
 
     async def async_step_reauth_confirm(
@@ -105,6 +100,11 @@ class EsphomeFlowHandler(ConfigFlow, domain=DOMAIN):
         """Handle reauthorization flow."""
         errors = {}
 
+        if await self._retrieve_encryption_key_from_dashboard():
+            error = await self.fetch_device_info()
+            if error is None:
+                return await self._async_authenticate_or_add()
+
         if user_input is not None:
             self._noise_psk = user_input[CONF_NOISE_PSK]
             error = await self.fetch_device_info()
diff --git a/tests/components/esphome/test_config_flow.py b/tests/components/esphome/test_config_flow.py
index a2f51f2526e..f7326d05b8f 100644
--- a/tests/components/esphome/test_config_flow.py
+++ b/tests/components/esphome/test_config_flow.py
@@ -566,6 +566,59 @@ async def test_reauth_fixed_via_dashboard_remove_password(
     assert len(mock_get_encryption_key.mock_calls) == 1
 
 
+async def test_reauth_fixed_via_dashboard_at_confirm(
+    hass, mock_client, mock_zeroconf, mock_dashboard
+):
+    """Test reauth fixed automatically via dashboard at confirm step."""
+
+    entry = MockConfigEntry(
+        domain=DOMAIN,
+        data={
+            CONF_HOST: "127.0.0.1",
+            CONF_PORT: 6053,
+            CONF_PASSWORD: "",
+            CONF_DEVICE_NAME: "test",
+        },
+    )
+    entry.add_to_hass(hass)
+
+    mock_client.device_info.return_value = DeviceInfo(uses_password=False, name="test")
+
+    result = await hass.config_entries.flow.async_init(
+        "esphome",
+        context={
+            "source": config_entries.SOURCE_REAUTH,
+            "entry_id": entry.entry_id,
+            "unique_id": entry.unique_id,
+        },
+    )
+
+    assert result["type"] == FlowResultType.FORM, result
+    assert result["step_id"] == "reauth_confirm"
+
+    mock_dashboard["configured"].append(
+        {
+            "name": "test",
+            "configuration": "test.yaml",
+        }
+    )
+
+    await dashboard.async_get_dashboard(hass).async_refresh()
+
+    with patch(
+        "homeassistant.components.esphome.dashboard.ESPHomeDashboardAPI.get_encryption_key",
+        return_value=VALID_NOISE_PSK,
+    ) as mock_get_encryption_key:
+        # We just fetch the form
+        result = await hass.config_entries.flow.async_configure(result["flow_id"])
+
+    assert result["type"] == FlowResultType.ABORT, result
+    assert result["reason"] == "reauth_successful"
+    assert entry.data[CONF_NOISE_PSK] == VALID_NOISE_PSK
+
+    assert len(mock_get_encryption_key.mock_calls) == 1
+
+
 async def test_reauth_confirm_invalid(hass, mock_client, mock_zeroconf):
     """Test reauth initiation with invalid PSK."""
     entry = MockConfigEntry(