diff --git a/__tests__/components/buttons/CloseChatButton.test.tsx b/__tests__/components/buttons/CloseChatButton.test.tsx
new file mode 100644
index 00000000..71bf39c0
--- /dev/null
+++ b/__tests__/components/buttons/CloseChatButton.test.tsx
@@ -0,0 +1,187 @@
+import React from "react";
+
+import { expect } from "@jest/globals";
+import { render, screen, fireEvent } from "@testing-library/react";
+import "@testing-library/jest-dom/jest-globals";
+
+import CloseChatButton from "../../../src/components/Buttons/CloseChatButton/CloseChatButton";
+import { DefaultSettings } from "../../../src/constants/internal/DefaultSettings";
+
+import { useChatWindowInternal } from "../../../src/hooks/internal/useChatWindowInternal";
+import { useSettingsContext } from "../../../src/context/SettingsContext";
+import { useStylesContext } from "../../../src/context/StylesContext";
+
+// Mock the hooks used in the component
+jest.mock("../../../src/hooks/internal/useChatWindowInternal");
+jest.mock("../../../src/context/SettingsContext");
+jest.mock("../../../src/context/StylesContext");
+
+/**
+ * Test for CloseChatButton component.
+ */
+describe("CloseChatButton", () => {
+	const openChatMock = jest.fn();
+
+	beforeEach(() => {
+		// Mock the return value of useChatWindowInternal hook
+		(useChatWindowInternal as jest.Mock).mockReturnValue({
+			openChat: openChatMock,
+		});
+
+		// Mock the return value of useSettingsContext hook
+		(useSettingsContext as jest.Mock).mockReturnValue({
+			settings: {
+				header: { closeChatIcon: DefaultSettings.header?.closeChatIcon },
+				ariaLabel: { closeChatButton: DefaultSettings.ariaLabel?.closeChatButton },
+			},
+		});
+
+		// Mock the return value of useStylesContext hook
+		(useStylesContext as jest.Mock).mockReturnValue({
+			styles: {
+				closeChatIconStyle: { color: "red" }, 
+				closeChatButtonStyle: { backgroundColor: "gray" },
+			},
+		});
+	});
+
+	it("renders the CloseChatButton component", () => {
+		// Render the CloseChatButton component
+		render(<CloseChatButton />);
+
+		// Get the button element by its role and name using default settings
+		const button = screen.getByRole("button", { name: DefaultSettings.ariaLabel?.closeChatButton });
+
+		// Assert that the button is in the document
+		expect(button).toBeInTheDocument();
+	});
+
+	it("displays the correct aria-label", () => {
+		// Render the CloseChatButton component
+		render(<CloseChatButton />);
+		// Get the button element by its role and name using default settings
+		const button = screen.getByRole("button", { name: DefaultSettings.ariaLabel?.closeChatButton });
+
+		// Assert that the button has the correct aria-label attribute
+		expect(button).toHaveAttribute("aria-label", DefaultSettings.ariaLabel?.closeChatButton);
+	});
+
+	it("applies the correct background image to the close chat icon", () => {
+		// Render the CloseChatButton component
+		render(<CloseChatButton />);
+		// Get the button element by its role
+		const button = screen.getByRole("button");
+		// Get the span element inside the button (assumed to be the icon)
+		const icon = button.querySelector("span");
+
+		// Check if the background image is set correctly
+		expect(icon).toHaveStyle(`background-image: url(${DefaultSettings.header?.closeChatIcon})`);
+	});
+
+	it("applies the default aria-label when none is provided in settings", () => {
+		// Mock settings without ariaLabel.closeChatButton
+		(useSettingsContext as jest.Mock).mockReturnValue({
+			settings: {
+				header: { closeChatIcon: DefaultSettings.header?.closeChatIcon },
+				ariaLabel: {},
+			},
+		});
+
+		render(<CloseChatButton />);
+
+		// Check if the aria-label falls back to "close chat"
+		const button = screen.getByRole("button", { name: DefaultSettings.ariaLabel?.closeChatButton });
+		expect(button).toHaveAttribute("aria-label", DefaultSettings.ariaLabel?.closeChatButton);
+	});
+
+	it("applies the correct styles to the button and icon", () => {
+		// Render the CloseChatButton component
+		render(<CloseChatButton />);
+		// Get the button element by its role
+		const button = screen.getByRole("button");
+		// Get the span element inside the button (assumed to be the icon)
+		const icon = button.querySelector("span");
+
+		// Assert that the button has the correct background color
+		expect(button).toHaveStyle("background-color: gray");
+		// Assert that the icon has the correct color
+		expect(icon).toHaveStyle("color: red");
+		// Assert that the icon has the correct background image
+		expect(icon).toHaveStyle(`background-image: url(${DefaultSettings.header?.closeChatIcon})`);
+	});
+
+	it("calls openChat(false) when the button is clicked", () => {
+		// Render the CloseChatButton component
+		render(<CloseChatButton />);
+		// Get the button element by its role
+		const button = screen.getByRole("button");
+		// Fire the mouseDown event on the button
+		fireEvent.mouseDown(button);
+		// Assert that openChatMock was called with false
+		expect(openChatMock).toHaveBeenCalledWith(false);
+	});
+
+	it("stops propagation of mouse down event", () => {
+		// Render the component
+		render(<CloseChatButton />);
+		const button = screen.getByRole("button");
+
+		// Spy on the stopPropagation method of the event
+		const stopPropagationSpy = jest.spyOn(MouseEvent.prototype, "stopPropagation");
+
+		// Fire the mouseDown event
+		fireEvent.mouseDown(button);
+
+		// Assert that stopPropagation was called
+		expect(stopPropagationSpy).toHaveBeenCalled();
+
+		// Clean up the spy
+		stopPropagationSpy.mockRestore();
+	});
+
+	it("handles undefined settings.header gracefully", () => {
+		// Mock settings with undefined header
+		(useSettingsContext as jest.Mock).mockReturnValue({
+			settings: {
+				header: undefined, // Simulate missing header
+				ariaLabel: { closeChatButton: DefaultSettings.ariaLabel?.closeChatButton },
+			},
+		});
+
+		(useStylesContext as jest.Mock).mockReturnValue({
+			styles: {
+				closeChatIconStyle: { color: "red" },
+				closeChatButtonStyle: { backgroundColor: "gray" },
+			},
+		});
+
+		render(<CloseChatButton />);
+
+		// Check that it renders without crashing
+		const button = screen.getByRole("button", { name: DefaultSettings.ariaLabel?.closeChatButton });
+		expect(button).toBeInTheDocument();
+	});
+
+	it("handles undefined settings.ariaLabel gracefully", () => {
+		// Mock settings without ariaLabel
+		(useSettingsContext as jest.Mock).mockReturnValue({
+			settings: {
+				header: { closeChatIcon: DefaultSettings.header?.closeChatIcon },
+				ariaLabel: undefined, // Simulate missing ariaLabel
+			},
+		});
+
+		(useStylesContext as jest.Mock).mockReturnValue({
+			styles: {
+				closeChatIconStyle: { color: "red" },
+				closeChatButtonStyle: { backgroundColor: "gray" },
+			},
+		});
+
+		render(<CloseChatButton />);
+
+		// Check that it falls back to the default aria-label
+		const button = screen.getByRole("button", { name: DefaultSettings.ariaLabel?.closeChatButton });
+		expect(button).toHaveAttribute("aria-label", DefaultSettings.ariaLabel?.closeChatButton);
+	});
+});