diff --git a/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayDialogFragment.kt b/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayDialogFragment.kt
index 849ac9e64..dd72cf8b4 100644
--- a/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayDialogFragment.kt
+++ b/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayDialogFragment.kt
@@ -161,14 +161,13 @@ class TabTrayDialogFragment : AppCompatDialogFragment(), UserInteractionHandler
 
         if (newConfig.orientation != currentOrientation) {
             tabTrayView.dismissMenu()
-            tabTrayView.expand()
+            tabTrayView.updateBottomSheetBehavior()
 
             if (requireContext().settings().gridTabView) {
                 // Update the number of columns to use in the grid view when the screen
                 // orientation changes.
                 tabTrayView.updateTabsTrayLayout()
             }
-
             currentOrientation = newConfig.orientation
         }
     }
@@ -205,8 +204,7 @@ class TabTrayDialogFragment : AppCompatDialogFragment(), UserInteractionHandler
             ),
             store = tabTrayDialogStore,
             isPrivate = isPrivate,
-            startingInLandscape = requireContext().resources.configuration.orientation ==
-                    Configuration.ORIENTATION_LANDSCAPE,
+            isInLandscape = ::isInLandscape,
             lifecycleOwner = viewLifecycleOwner
         ) { private ->
             val filter: (TabSessionState) -> Boolean = { state -> private == state.content.private }
@@ -450,6 +448,10 @@ class TabTrayDialogFragment : AppCompatDialogFragment(), UserInteractionHandler
         }
     }
 
+    private fun isInLandscape(): Boolean {
+        return requireContext().resources.configuration.orientation == Configuration.ORIENTATION_LANDSCAPE
+    }
+
     companion object {
         private const val ELEVATION = 80f
     }
diff --git a/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayView.kt b/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayView.kt
index 25eaad1cf..87894865a 100644
--- a/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayView.kt
+++ b/app/src/main/java/org/mozilla/fenix/tabtray/TabTrayView.kt
@@ -40,6 +40,7 @@ import mozilla.components.browser.state.selector.getNormalOrPrivateTabs
 import mozilla.components.browser.state.selector.normalTabs
 import mozilla.components.browser.state.selector.privateTabs
 import mozilla.components.browser.state.state.BrowserState
+import mozilla.components.browser.state.state.TabSessionState
 import mozilla.components.browser.tabstray.TabViewHolder
 import mozilla.components.feature.syncedtabs.SyncedTabsFeature
 import mozilla.components.support.base.feature.ViewBoundFeatureWrapper
@@ -54,6 +55,7 @@ import org.mozilla.fenix.ext.settings
 import org.mozilla.fenix.tabtray.SaveToCollectionsButtonAdapter.MultiselectModeChange
 import org.mozilla.fenix.tabtray.TabTrayDialogFragmentState.Mode
 import java.text.NumberFormat
+import kotlin.math.max
 import mozilla.components.browser.storage.sync.Tab as SyncTab
 
 /**
@@ -66,7 +68,7 @@ class TabTrayView(
     private val interactor: TabTrayInteractor,
     store: TabTrayDialogFragmentStore,
     isPrivate: Boolean,
-    startingInLandscape: Boolean,
+    private val isInLandscape: () -> Boolean,
     lifecycleOwner: LifecycleOwner,
     private val filterTabs: (Boolean) -> Unit
 ) : LayoutContainer, TabLayout.OnTabSelectedListener {
@@ -145,20 +147,14 @@ class TabTrayView(
 
         view.tab_layout.addOnTabSelectedListener(this)
 
-        val tabs = if (isPrivate) {
-            view.context.components.core.store.state.privateTabs
-        } else {
-            view.context.components.core.store.state.normalTabs
-        }
+        val tabs = getTabs(isPrivate)
 
         val selectedBrowserTabIndex = tabs
             .indexOfFirst { it.id == view.context.components.core.store.state.selectedTabId }
 
-        if (tabs.size > EXPAND_AT_SIZE || startingInLandscape) {
-            expand()
-        }
+        updateBottomSheetBehavior()
 
-        setTopOffset(startingInLandscape)
+        setTopOffset(isInLandscape())
 
         if (view.context.settings().syncedTabsInTabsTray) {
             syncedTabsFeature.set(
@@ -280,6 +276,27 @@ class TabTrayView(
         }
     }
 
+    private fun getTabs(isPrivate: Boolean): List<TabSessionState> = if (isPrivate) {
+        view.context.components.core.store.state.privateTabs
+    } else {
+        view.context.components.core.store.state.normalTabs
+    }
+
+    private fun getTabsNumberInAnyMode(): Int {
+        return max(
+            view.context.components.core.store.state.normalTabs.size,
+            view.context.components.core.store.state.privateTabs.size
+        )
+    }
+
+    private fun getTabsNumberForExpandingTray(): Int {
+        return if (container.context.settings().gridTabView) {
+            EXPAND_AT_GRID_SIZE
+        } else {
+            EXPAND_AT_LIST_SIZE
+        }
+    }
+
     private fun handleTabClicked(tab: SyncTab) {
         interactor.onSyncedTabClicked(tab)
     }
@@ -312,8 +329,17 @@ class TabTrayView(
         components.analytics.metrics.track(eventToSend)
     }
 
-    fun expand() {
-        behavior.state = BottomSheetBehavior.STATE_EXPANDED
+    /**
+     * Updates the bottom sheet height based on the number tabs or screen orientation.
+     * Show the bottom sheet fully expanded if it is in landscape mode or the number of
+     * tabs are greater or equal to the expand size limit.
+     */
+    fun updateBottomSheetBehavior() {
+        if (isInLandscape() || getTabsNumberInAnyMode() >= getTabsNumberForExpandingTray()) {
+            behavior.state = BottomSheetBehavior.STATE_EXPANDED
+        } else {
+            behavior.state = BottomSheetBehavior.STATE_COLLAPSED
+        }
     }
 
     enum class TabChange {
@@ -668,7 +694,10 @@ class TabTrayView(
         private const val TAB_COUNT_SHOW_CFR = 6
         private const val DEFAULT_TAB_ID = 0
         private const val PRIVATE_TAB_ID = 1
-        private const val EXPAND_AT_SIZE = 3
+        // Minimum number of list items for which to show the tabs tray as expanded.
+        private const val EXPAND_AT_LIST_SIZE = 4
+        // Minimum number of grid items for which to show the tabs tray as expanded.
+        private const val EXPAND_AT_GRID_SIZE = 3
         private const val SLIDE_OFFSET = 0
         private const val SELECTION_DELAY = 500
         private const val NORMAL_HANDLE_PERCENT_WIDTH = 0.1F