diff --git a/packages/components/CHANGELOG.md b/packages/components/CHANGELOG.md
index 3009b0a882891b..8924dd7675372b 100644
--- a/packages/components/CHANGELOG.md
+++ b/packages/components/CHANGELOG.md
@@ -12,6 +12,7 @@
 ### Bug Fix
 
 -   `SlotFill`: fixed missing `getServerSnapshot` parameter in slot map ([#60943](https://github.com/WordPress/gutenberg/pull/60943)).
+-   `Panel`: Fix issue with collapsing panel header ([#61319](https://github.com/WordPress/gutenberg/pull/61319)).
 
 ### Enhancements
 
diff --git a/packages/components/src/panel/style.scss b/packages/components/src/panel/style.scss
index b26f134e72350b..e525cd92569182 100644
--- a/packages/components/src/panel/style.scss
+++ b/packages/components/src/panel/style.scss
@@ -32,6 +32,7 @@
 
 .components-panel__header {
 	display: flex;
+	flex-shrink: 0;
 	justify-content: space-between;
 	align-items: center;
 	padding: 0 $grid-unit-20;