diff --git a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.stories.jsx b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.stories.jsx
index 28dd6f748f..f65a7487da 100644
--- a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.stories.jsx
+++ b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.stories.jsx
@@ -5,7 +5,7 @@
  * LICENSE file in the root directory of this source tree.
  */
 
-import React, { useState } from 'react';
+import React, { useRef, useState } from 'react';
 import {
   Button,
   TextInput,
@@ -85,6 +85,7 @@ const blockClass = `${pkg.prefix}--apikey-modal`;
 const InstantTemplate = (args) => {
   const [open, setOpen] = useState(false);
   const [loading, setLoading] = useState(false);
+  const buttonRef = useRef(undefined);
 
   const generateKey = async () => {
     setLoading(true);
@@ -96,7 +97,12 @@ const InstantTemplate = (args) => {
   return (
     <>
       <style>{`.${blockClass} { opacity: 0; }`};</style>
-      <APIKeyModal {...args} onClose={() => setOpen(false)} open={open} />
+      <APIKeyModal
+        {...args}
+        onClose={() => setOpen(false)}
+        open={open}
+        launcherButtonRef={buttonRef}
+      />
       {loading ? (
         <Button
           renderIcon={InlineLoading}
@@ -105,7 +111,9 @@ const InstantTemplate = (args) => {
           Generating...
         </Button>
       ) : (
-        <Button onClick={generateKey}>Generate</Button>
+        <Button onClick={generateKey} ref={buttonRef}>
+          Generate
+        </Button>
       )}
     </>
   );
@@ -117,6 +125,7 @@ const TemplateWithState = (args) => {
   const [apiKey, setApiKey] = useState('');
   const [loading, setLoading] = useState(false);
   const [fetchError, setFetchError] = useState(false);
+  const buttonRef = useRef(undefined);
 
   // eslint-disable-next-line
   const submitHandler = async (apiKeyName) => {
@@ -148,8 +157,11 @@ const TemplateWithState = (args) => {
         onRequestGenerate={submitHandler}
         open={open}
         error={fetchError}
+        launcherButtonRef={buttonRef}
       />
-      <Button onClick={() => setOpen(!open)}>Generate API key</Button>
+      <Button onClick={() => setOpen(!open)} ref={buttonRef}>
+        Generate API key
+      </Button>
     </>
   );
 };
@@ -166,6 +178,7 @@ const MultiStepTemplate = (args) => {
   const [open, setOpen] = useState(false);
   const [apiKey, setApiKey] = useState('');
   const [loading, setLoading] = useState(false);
+  const buttonRef = useRef(undefined);
 
   // multi step options
   const [name, setName] = useState(savedName);
@@ -310,8 +323,9 @@ const MultiStepTemplate = (args) => {
         customSteps={steps}
         nameRequired={false}
         editSuccess={editSuccess}
+        launcherButtonRef={buttonRef}
       />
-      <Button onClick={() => setOpen(!open)}>
+      <Button onClick={() => setOpen(!open)} ref={buttonRef}>
         {editing ? 'Edit API key' : 'Generate API key'}
       </Button>
     </>
@@ -324,6 +338,7 @@ const EditTemplate = (args) => {
   const [loading, setLoading] = useState(false);
   const [fetchError, setFetchError] = useState(false);
   const [fetchSuccess, setFetchSuccess] = useState(false);
+  const buttonRef = useRef(undefined);
 
   const submitHandler = async () => {
     action(`submitted ${apiKeyName}`)();
@@ -357,8 +372,11 @@ const EditTemplate = (args) => {
         open={open}
         error={fetchError}
         editSuccess={fetchSuccess}
+        launcherButtonRef={buttonRef}
       />
-      <Button onClick={onOpenHandler}>Edit API key</Button>
+      <Button onClick={onOpenHandler} ref={buttonRef}>
+        Edit API key
+      </Button>
     </>
   );
 };
diff --git a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.test.js b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.test.js
index b46f110f76..0e69271bec 100644
--- a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.test.js
+++ b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.test.js
@@ -17,6 +17,7 @@ import React from 'react';
 import { carbon } from '../../settings';
 
 import { APIKeyModal } from '.';
+import { Button } from '@carbon/react';
 
 Object.assign(navigator, {
   clipboard: {
@@ -302,6 +303,52 @@ describe(componentName, () => {
     expect(step1InputB).toHaveFocus();
   });
 
+  it('should return focus to the generate button', async () => {
+    const onOpen = jest.fn(() => false);
+    const onClose = jest.fn(() => true);
+
+    // eslint-disable-next-line react/prop-types
+    const DummyComponent = ({ open }) => {
+      const buttonRef = React.useRef(undefined);
+
+      return (
+        <>
+          <APIKeyModal
+            {...defaultProps}
+            launcherButtonRef={buttonRef}
+            onClose={onClose}
+            open={open}
+          />
+          <Button ref={buttonRef} onClick={onOpen}>
+            Generate
+          </Button>
+        </>
+      );
+    };
+
+    const { getByText, rerender } = render(<DummyComponent open={false} />);
+
+    const launchButtonEl = getByText('Generate');
+    expect(launchButtonEl).toBeInTheDocument();
+
+    await act(() => userEvent.click(launchButtonEl));
+    expect(onOpen).toHaveBeenCalled();
+
+    rerender(<DummyComponent open={true} />);
+
+    const closeButton = getByText(defaultProps.closeButtonText);
+    await act(() => new Promise((resolve) => setTimeout(resolve, 0)));
+    expect(closeButton).toBeInTheDocument();
+
+    await act(() => userEvent.click(closeButton));
+    expect(onClose).toHaveBeenCalled();
+
+    rerender(<DummyComponent open={false} />);
+
+    await act(() => new Promise((resolve) => setTimeout(resolve, 0)));
+    expect(launchButtonEl).toHaveFocus();
+  });
+
   it('successfully edits', async () => {
     const { change } = fireEvent;
     const { click } = userEvent;
diff --git a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.tsx b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.tsx
index 847aed8762..5e2b48217f 100644
--- a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.tsx
+++ b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.tsx
@@ -35,7 +35,7 @@ import { getDevtoolsProps } from '../../global/js/utils/devtools';
 import { isRequiredIf } from '../../global/js/utils/props-helper';
 import uuidv4 from '../../global/js/utils/uuidv4';
 import { APIKeyModalProps } from './APIKeyModal.types';
-import { useFocus } from '../../global/js/hooks';
+import { useFocus, usePreviousValue } from '../../global/js/hooks';
 import { getSpecificElement } from '../../global/js/hooks/useFocus';
 
 const componentName = 'APIKeyModal';
@@ -78,6 +78,7 @@ export let APIKeyModal: React.FC<APIKeyModalProps> = forwardRef(
       hasAPIKeyVisibilityToggle,
       hasDownloadLink,
       hideAPIKeyLabel,
+      launcherButtonRef,
       loading,
       loadingText,
       modalLabel,
@@ -125,6 +126,7 @@ export let APIKeyModal: React.FC<APIKeyModalProps> = forwardRef(
       modalRef,
       selectorPrimaryFocus
     );
+    const prevOpen = usePreviousValue(open);
 
     useEffect(() => {
       if (copyRef.current && open && apiKeyLoaded) {
@@ -159,6 +161,14 @@ export let APIKeyModal: React.FC<APIKeyModalProps> = forwardRef(
       }
     }, [firstElement, modalRef, open, selectorPrimaryFocus]);
 
+    useEffect(() => {
+      if (prevOpen && !open && launcherButtonRef) {
+        setTimeout(() => {
+          launcherButtonRef.current.focus();
+        }, 0);
+      }
+    }, [launcherButtonRef, open, prevOpen]);
+
     const isPrimaryButtonDisabled = () => {
       if (loading) {
         return true;
@@ -517,6 +527,11 @@ APIKeyModal.propTypes = {
    * label text that's displayed when hovering over visibility toggler to hide key
    */
   hideAPIKeyLabel: PropTypes.string,
+  /**
+   * Provide a ref to return focus to once the tearsheet is closed.
+   */
+  /**@ts-ignore */
+  launcherButtonRef: PropTypes.any,
   /**
    * designates if the modal is in a loading state via a request or some other in progress operation
    */
diff --git a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.types.ts b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.types.ts
index 0297bcfd43..200528760a 100644
--- a/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.types.ts
+++ b/packages/ibm-products/src/components/APIKeyModal/APIKeyModal.types.ts
@@ -5,7 +5,7 @@
  * LICENSE file in the root directory of this source tree.
  */
 
-import { ReactNode } from 'react';
+import { ReactNode, RefObject } from 'react';
 
 interface APIKeyModalCommonProps {
   /**
@@ -94,6 +94,10 @@ interface APIKeyModalCommonProps {
    * label text that's displayed when hovering over visibility toggler to hide key
    */
   hideAPIKeyLabel?: string;
+  /**
+   * Provide a ref to return focus to once the tearsheet is closed.
+   */
+  launcherButtonRef?: RefObject<any>;
   /**
    * designates if the modal is in a loading state via a request or some other in progress operation
    */