diff --git a/homeassistant/components/esphome/dashboard.py b/homeassistant/components/esphome/dashboard.py
index 3ce07d683b9..052d6161cf9 100644
--- a/homeassistant/components/esphome/dashboard.py
+++ b/homeassistant/components/esphome/dashboard.py
@@ -8,7 +8,7 @@ import logging
 import aiohttp
 from esphome_dashboard_api import ConfiguredDevice, ESPHomeDashboardAPI
 
-from homeassistant.config_entries import ConfigEntryState
+from homeassistant.config_entries import SOURCE_REAUTH, ConfigEntryState
 from homeassistant.core import HomeAssistant, callback
 from homeassistant.helpers.aiohttp_client import async_get_clientsession
 from homeassistant.helpers.update_coordinator import DataUpdateCoordinator, UpdateFailed
@@ -52,8 +52,14 @@ async def async_set_dashboard_info(
         for entry in hass.config_entries.async_entries(DOMAIN)
         if entry.state == ConfigEntryState.LOADED
     ]
-    if reloads:
-        await asyncio.gather(*reloads)
+    # Re-auth flows will check the dashboard for encryption key when the form is requested
+    reauths = [
+        hass.config_entries.flow.async_configure(flow["flow_id"])
+        for flow in hass.config_entries.flow.async_progress()
+        if flow["handler"] == DOMAIN and flow["context"]["source"] == SOURCE_REAUTH
+    ]
+    if reloads or reauths:
+        await asyncio.gather(*reloads, *reauths)
 
 
 class ESPHomeDashboard(DataUpdateCoordinator[dict[str, ConfiguredDevice]]):
diff --git a/tests/components/esphome/__init__.py b/tests/components/esphome/__init__.py
index 764a06f3bb9..a44db03f841 100644
--- a/tests/components/esphome/__init__.py
+++ b/tests/components/esphome/__init__.py
@@ -3,3 +3,4 @@
 DASHBOARD_SLUG = "mock-slug"
 DASHBOARD_HOST = "mock-host"
 DASHBOARD_PORT = 1234
+VALID_NOISE_PSK = "bOFFzzvfpg5DB94DuBGLXD/hMnhpDKgP9UQyBulwWVU="
diff --git a/tests/components/esphome/conftest.py b/tests/components/esphome/conftest.py
index 6febe15389a..f53e513e6bb 100644
--- a/tests/components/esphome/conftest.py
+++ b/tests/components/esphome/conftest.py
@@ -7,7 +7,12 @@ from aioesphomeapi import APIClient, DeviceInfo
 import pytest
 from zeroconf import Zeroconf
 
-from homeassistant.components.esphome import CONF_NOISE_PSK, DOMAIN, dashboard
+from homeassistant.components.esphome import (
+    CONF_DEVICE_NAME,
+    CONF_NOISE_PSK,
+    DOMAIN,
+    dashboard,
+)
 from homeassistant.const import CONF_HOST, CONF_PASSWORD, CONF_PORT
 from homeassistant.core import HomeAssistant
 
@@ -27,9 +32,9 @@ def esphome_mock_async_zeroconf(mock_async_zeroconf):
 
 
 @pytest.fixture
-def mock_config_entry() -> MockConfigEntry:
+def mock_config_entry(hass) -> MockConfigEntry:
     """Return the default mocked config entry."""
-    return MockConfigEntry(
+    config_entry = MockConfigEntry(
         title="ESPHome Device",
         domain=DOMAIN,
         data={
@@ -37,9 +42,12 @@ def mock_config_entry() -> MockConfigEntry:
             CONF_PORT: 6053,
             CONF_PASSWORD: "pwd",
             CONF_NOISE_PSK: "12345678123456781234567812345678",
+            CONF_DEVICE_NAME: "test",
         },
         unique_id="11:22:33:44:55:aa",
     )
+    config_entry.add_to_hass(hass)
+    return config_entry
 
 
 @pytest.fixture
@@ -59,8 +67,6 @@ async def init_integration(
     hass: HomeAssistant, mock_config_entry: MockConfigEntry
 ) -> MockConfigEntry:
     """Set up the ESPHome integration for testing."""
-    mock_config_entry.add_to_hass(hass)
-
     await hass.config_entries.async_setup(mock_config_entry.entry_id)
     await hass.async_block_till_done()
 
diff --git a/tests/components/esphome/test_config_flow.py b/tests/components/esphome/test_config_flow.py
index f7326d05b8f..92e2df5ca39 100644
--- a/tests/components/esphome/test_config_flow.py
+++ b/tests/components/esphome/test_config_flow.py
@@ -24,9 +24,10 @@ from homeassistant.components.hassio import HassioServiceInfo
 from homeassistant.const import CONF_HOST, CONF_PASSWORD, CONF_PORT
 from homeassistant.data_entry_flow import FlowResultType
 
+from . import VALID_NOISE_PSK
+
 from tests.common import MockConfigEntry
 
-VALID_NOISE_PSK = "bOFFzzvfpg5DB94DuBGLXD/hMnhpDKgP9UQyBulwWVU="
 INVALID_NOISE_PSK = "lSYBYEjQI1bVL8s2Vask4YytGMj1f1epNtmoim2yuTM="
 
 
diff --git a/tests/components/esphome/test_dashboard.py b/tests/components/esphome/test_dashboard.py
index 7a5486d5205..c14bb06d3d8 100644
--- a/tests/components/esphome/test_dashboard.py
+++ b/tests/components/esphome/test_dashboard.py
@@ -1,8 +1,13 @@
 """Test ESPHome dashboard features."""
 from unittest.mock import patch
 
-from homeassistant.components.esphome import dashboard
-from homeassistant.config_entries import ConfigEntryState
+from aioesphomeapi import DeviceInfo
+
+from homeassistant.components.esphome import CONF_NOISE_PSK, dashboard
+from homeassistant.config_entries import SOURCE_REAUTH, ConfigEntryState
+from homeassistant.data_entry_flow import FlowResultType
+
+from . import VALID_NOISE_PSK
 
 
 async def test_new_info_reload_config_entries(hass, init_integration, mock_dashboard):
@@ -20,3 +25,48 @@ async def test_new_info_reload_config_entries(hass, init_integration, mock_dashb
         await dashboard.async_set_dashboard_info(hass, "test-slug", "test-host", 6052)
 
     assert len(mock_setup.mock_calls) == 0
+
+
+async def test_new_dashboard_fix_reauth(
+    hass, mock_client, mock_config_entry, mock_dashboard
+):
+    """Test config entries waiting for reauth are triggered."""
+    mock_client.device_info.return_value = DeviceInfo(uses_password=False, name="test")
+
+    with patch(
+        "homeassistant.components.esphome.dashboard.ESPHomeDashboardAPI.get_encryption_key",
+        return_value=VALID_NOISE_PSK,
+    ) as mock_get_encryption_key:
+        result = await hass.config_entries.flow.async_init(
+            "esphome",
+            context={
+                "source": SOURCE_REAUTH,
+                "entry_id": mock_config_entry.entry_id,
+                "unique_id": mock_config_entry.unique_id,
+            },
+        )
+    assert result["type"] == FlowResultType.FORM
+    assert result["step_id"] == "reauth_confirm"
+    assert len(mock_get_encryption_key.mock_calls) == 0
+
+    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, patch(
+        "homeassistant.components.esphome.async_setup_entry", return_value=True
+    ) as mock_setup:
+        await dashboard.async_set_dashboard_info(hass, "test-slug", "test-host", 6052)
+        await hass.async_block_till_done()
+
+    assert len(mock_get_encryption_key.mock_calls) == 1
+    assert len(mock_setup.mock_calls) == 1
+    assert mock_config_entry.data[CONF_NOISE_PSK] == VALID_NOISE_PSK
diff --git a/tests/components/esphome/test_diagnostics.py b/tests/components/esphome/test_diagnostics.py
index 959d49c4ee3..6a08a47e6eb 100644
--- a/tests/components/esphome/test_diagnostics.py
+++ b/tests/components/esphome/test_diagnostics.py
@@ -3,7 +3,7 @@
 from aiohttp import ClientSession
 import pytest
 
-from homeassistant.components.esphome import CONF_NOISE_PSK
+from homeassistant.components.esphome import CONF_DEVICE_NAME, CONF_NOISE_PSK
 from homeassistant.const import CONF_HOST, CONF_PASSWORD, CONF_PORT
 from homeassistant.core import HomeAssistant
 
@@ -25,6 +25,7 @@ async def test_diagnostics(
 
     assert isinstance(result, dict)
     assert result["config"]["data"] == {
+        CONF_DEVICE_NAME: "test",
         CONF_HOST: "192.168.1.2",
         CONF_PORT: 6053,
         CONF_PASSWORD: "**REDACTED**",