diff --git a/app/javascript/dashboard/components-next/Conversation/Chips/UnreadIndicator.vue b/app/javascript/dashboard/components-next/Conversation/Chips/UnreadIndicator.vue
new file mode 100644
index 000000000..66d89f0cb
--- /dev/null
+++ b/app/javascript/dashboard/components-next/Conversation/Chips/UnreadIndicator.vue
@@ -0,0 +1,44 @@
+<script setup>
+import { vIntersectionObserver } from '@vueuse/components';
+import { computed } from 'vue';
+
+const props = defineProps({
+  label: {
+    type: String,
+    required: true,
+  },
+  variant: {
+    type: String,
+    default: 'primary',
+    validator: value => ['primary', 'secondary'].includes(value),
+  },
+});
+
+const emit = defineEmits(['click', 'intersect']);
+
+function onIntersectionObserver([entry]) {
+  const isVisible = entry?.isIntersecting || false;
+  emit('intersect', isVisible);
+}
+
+const classToApply = computed(() => {
+  return {
+    'bg-n-solid-blue text-n-blue-text': props.variant === 'primary',
+    'shadow-sm border border-n-weak bg-n-solid-2 text-n-slate-11':
+      props.variant === 'secondary',
+  };
+});
+</script>
+
+<template>
+  <div>
+    <div
+      v-intersection-observer="onIntersectionObserver"
+      :class="classToApply"
+      class="flex py-1.5 pr-2 pl-3 rounded-full text-xs font-semibold my-2.5 mx-auto"
+      @click="emit('click')"
+    >
+      {{ label }}
+    </div>
+  </div>
+</template>
diff --git a/app/javascript/dashboard/components/widgets/conversation/MessagesView.vue b/app/javascript/dashboard/components/widgets/conversation/MessagesView.vue
index 00f2289ab..a8ccceeb8 100644
--- a/app/javascript/dashboard/components/widgets/conversation/MessagesView.vue
+++ b/app/javascript/dashboard/components/widgets/conversation/MessagesView.vue
@@ -11,6 +11,7 @@ import ReplyBox from './ReplyBox.vue';
 import Message from './Message.vue';
 import NextMessageList from 'next/message/MessageList.vue';
 import TypingIndicator from 'next/Conversation/Chips/TypingIndicator.vue';
+import UnreadIndicator from 'next/Conversation/Chips/UnreadIndicator.vue';
 import ConversationLabelSuggestion from './conversation/LabelSuggestion.vue';
 import Banner from 'dashboard/components/ui/Banner.vue';
 
@@ -43,6 +44,7 @@ export default {
     NextMessageList,
     ReplyBox,
     TypingIndicator,
+    UnreadIndicator,
     Banner,
     ConversationLabelSuggestion,
   },
@@ -110,6 +112,9 @@ export default {
   data() {
     return {
       isLoadingPrevious: true,
+      // this is only used to show a chip if the user has scrolled far enough
+      // we will hide this the moment the user reaches the start of the unread messages
+      showFloatingUnreadIndicator: false,
       heightBeforeLoad: null,
       conversationPanel: null,
       hasUserScrolled: false,
@@ -230,9 +235,9 @@ export default {
         this.unreadMessageCount > 9 ? '9+' : this.unreadMessageCount;
       const label =
         this.unreadMessageCount > 1
-          ? 'CONVERSATION.UNREAD_MESSAGES'
-          : 'CONVERSATION.UNREAD_MESSAGE';
-      return `${count} ${this.$t(label)}`;
+          ? this.$t('CONVERSATION.UNREAD_MESSAGES')
+          : this.$t('CONVERSATION.UNREAD_MESSAGE');
+      return `${count} ${label}`;
     },
     isInstagramDM() {
       return this.conversationType === 'instagram_direct_message';
@@ -344,7 +349,6 @@ export default {
           this.scrollToBottomIfNotScrolled();
         }
       });
-      this.makeMessagesRead();
     },
     addScrollListener() {
       this.conversationPanel = this.$el.querySelector('.conversation-panel');
@@ -356,7 +360,7 @@ export default {
     removeScrollListener() {
       this.conversationPanel.removeEventListener('scroll', this.handleScroll);
     },
-    scrollToBottomIfNotScrolled() {
+    isNearBottom(offset = 200) {
       // In case the user has already scrolled to a point in the message, we should
       // not scroll to the bottom against the intent of the user.
       const clientHeight = this.conversationPanel.clientHeight;
@@ -371,13 +375,20 @@ export default {
       // if the user is at the bottom or close to the bottom, we can skip scrolling
       // we add a 200px margin, this has enough space to accomodate new messages
       // while also resetting position to the bottom if the user has scrolled but not significantly
-      const isNearBottom = scrollTop > scrollHeight - clientHeight - 200;
+      return scrollTop > scrollHeight - clientHeight - offset;
+    },
+    scrollToBottomIfNotScrolled() {
+      const isNearBottom = this.isNearBottom();
 
-      if (this.hasUserScrolled && !isNearBottom) return;
+      if (this.hasUserScrolled && !isNearBottom) {
+        this.showFloatingUnreadIndicator = true;
+        return;
+      }
 
       this.scrollToBottom();
     },
     scrollToBottom() {
+      this.showFloatingUnreadIndicator = false;
       this.isProgrammaticScroll = true;
       let relevantMessages = [];
 
@@ -404,6 +415,10 @@ export default {
         ).slice(-1);
       }
 
+      if (this.unreadMessageCount !== 0) {
+        this.makeMessagesRead();
+      }
+
       this.conversationPanel.scrollTop = calculateScrollTop(
         this.conversationPanel.scrollHeight,
         this.$el.scrollHeight,
@@ -457,6 +472,14 @@ export default {
       } else {
         this.hasUserScrolled = true;
       }
+
+      // in case the user has scrolled to the bottom manually
+      // we trigger the makeMessagesRead method if there are unread messages
+      // TODO: debounce this check to ensure this does not affect performance
+      if (this.isNearBottom(50) && this.unreadMessageCount !== 0) {
+        this.makeMessagesRead();
+      }
+
       emitter.emit(BUS_EVENTS.ON_MESSAGE_LIST_SCROLL);
       this.fetchPreviousMessages(e.target.scrollTop);
     },
@@ -464,6 +487,14 @@ export default {
     makeMessagesRead() {
       this.$store.dispatch('markMessagesRead', { id: this.currentChat.id });
     },
+    // when the fixed unread badge is visible
+    // we trigger the makeMessagesRead method
+    onUnreadBadgeIntersect(visible) {
+      if (visible) {
+        this.showFloatingUnreadIndicator = false;
+        this.makeMessagesRead();
+      }
+    },
     getInReplyToMessage(parentMessage) {
       if (!parentMessage) return {};
       const inReplyToMessageId = parentMessage.content_attributes?.in_reply_to;
@@ -520,9 +551,12 @@ export default {
       </template>
       <template #unreadBadge>
         <li v-show="unreadMessageCount != 0" class="unread--toast">
-          <span>
-            {{ unreadMessageLabel }}
-          </span>
+          <UnreadIndicator
+            :label="unreadMessageLabel"
+            variant="primary"
+            class="mx-auto"
+            @intersect="onUnreadBadgeIntersect"
+          />
         </li>
       </template>
       <template #after>
@@ -598,6 +632,13 @@ export default {
         class="flex items-center justify-center gap-1 absolute w-full -top-7 h-0"
       >
         <TypingIndicator />
+        <UnreadIndicator
+          v-if="showFloatingUnreadIndicator && unreadMessageCount > 0"
+          variant="secondary"
+          class="cursor-pointer"
+          :label="unreadMessageLabel"
+          @click="scrollToBottom"
+        />
       </div>
       <ReplyBox
         v-model:popout-reply-box="isPopOutReplyBox"