diff --git a/packages/react-native-ui-lib/jestSetup/jest-setup.js b/packages/react-native-ui-lib/jestSetup/jest-setup.js
index 992dbe430d..57bae298da 100644
--- a/packages/react-native-ui-lib/jestSetup/jest-setup.js
+++ b/packages/react-native-ui-lib/jestSetup/jest-setup.js
@@ -79,6 +79,7 @@ jest.mock('react-native-gesture-handler',
       PanMock.onFinalize = getDefaultMockedHandler('onFinalize');
       PanMock.activateAfterLongPress = getDefaultMockedHandler('activateAfterLongPress');
       PanMock.enabled = getDefaultMockedHandler('enabled');
+      PanMock.minDistance = getDefaultMockedHandler('minDistance');
       PanMock.hitSlop = getDefaultMockedHandler('hitSlop');
       PanMock.onTouchesMove = getDefaultMockedHandler('onTouchesMove');
       PanMock.prepare = jest.fn();
diff --git a/packages/react-native-ui-lib/src/components/dialog/index.tsx b/packages/react-native-ui-lib/src/components/dialog/index.tsx
index 0e943f33cb..61fb23d615 100644
--- a/packages/react-native-ui-lib/src/components/dialog/index.tsx
+++ b/packages/react-native-ui-lib/src/components/dialog/index.tsx
@@ -190,6 +190,13 @@ const Dialog = (props: DialogProps, ref: ForwardedRef<DialogImperativeMethods>)
   };
 
   const panGesture = Gesture.Pan()
+    // MOBAPP-2994: require a deliberate drag before the pan engages. Without this, on Android/Fabric
+    // the residual touch stream from a gesture-handler trigger (e.g. List.Item's TapGestureHandler,
+    // which fires onPress on END while the touch is still settling) leaks into this freshly-mounted
+    // pan and drives `visibility` mid-open, interrupting the open spring so the sheet rests part-way.
+    // A plain touchable trigger (Button) lifts cleanly before the modal mounts and is unaffected.
+    // 10dp is small enough to keep drag-to-dismiss responsive while ignoring near-static residual touches.
+    .minDistance(10)
     .onStart(event => {
       initialTranslation.value =
         getTranslationReverseInterpolation(isVertical ? event.translationY : event.translationX) - visibility.value;