diff --git a/src/modules/poweraccent/PowerAccent.Core/PowerAccent.cs b/src/modules/poweraccent/PowerAccent.Core/PowerAccent.cs
index eb89dc8d66..d1a0e912a8 100644
--- a/src/modules/poweraccent/PowerAccent.Core/PowerAccent.cs
+++ b/src/modules/poweraccent/PowerAccent.Core/PowerAccent.cs
@@ -1,4 +1,4 @@
-// Copyright (c) Microsoft Corporation
+// Copyright (c) Microsoft Corporation
 // The Microsoft Corporation licenses this file to you under the MIT license.
 // See the LICENSE file in the project root for more information.
 
@@ -52,11 +52,11 @@ public class PowerAccent : IDisposable
             });
         }));
 
-        _keyboardListener.SetNextCharEvent(new PowerToys.PowerAccentKeyboardService.NextChar((TriggerKey triggerKey) =>
+        _keyboardListener.SetNextCharEvent(new PowerToys.PowerAccentKeyboardService.NextChar((TriggerKey triggerKey, bool shiftPressed) =>
         {
             System.Windows.Application.Current.Dispatcher.Invoke(() =>
             {
-                ProcessNextChar(triggerKey);
+                ProcessNextChar(triggerKey, shiftPressed);
             });
         }));
 
@@ -106,7 +106,7 @@ public class PowerAccent : IDisposable
         _visible = false;
     }
 
-    private void ProcessNextChar(TriggerKey triggerKey)
+    private void ProcessNextChar(TriggerKey triggerKey, bool shiftPressed)
     {
         if (_visible && _selectedIndex == -1)
         {
@@ -141,13 +141,27 @@ public class PowerAccent : IDisposable
 
         if (triggerKey == TriggerKey.Space)
         {
-            if (_selectedIndex < _characters.Length - 1)
+            if (shiftPressed)
             {
-                ++_selectedIndex;
+                if (_selectedIndex == 0)
+                {
+                    _selectedIndex = _characters.Length - 1;
+                }
+                else
+                {
+                    --_selectedIndex;
+                }
             }
             else
             {
-                _selectedIndex = 0;
+                if (_selectedIndex < _characters.Length - 1)
+                {
+                    ++_selectedIndex;
+                }
+                else
+                {
+                    _selectedIndex = 0;
+                }
             }
         }
 
diff --git a/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.cpp b/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.cpp
index 232e5b9943..362f3733fc 100644
--- a/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.cpp
+++ b/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.cpp
@@ -1,4 +1,4 @@
-#include "pch.h"
+#include "pch.h"
 #include "KeyboardListener.h"
 #include "KeyboardListener.g.cpp"
 
@@ -12,7 +12,7 @@
 namespace winrt::PowerToys::PowerAccentKeyboardService::implementation
 {
     KeyboardListener::KeyboardListener() :
-        m_toolbarVisible(false), m_triggeredWithSpace(false)
+        m_toolbarVisible(false), m_triggeredWithSpace(false), m_leftShiftPressed(false), m_rightShiftPressed(false)
     {
         s_instance = this;
         LoggerHelpers::init_logger(L"PowerAccent", L"PowerAccentKeyboardService", "PowerAccent");
@@ -66,8 +66,8 @@ namespace winrt::PowerToys::PowerAccentKeyboardService::implementation
 
     void KeyboardListener::SetNextCharEvent(NextChar nextCharEvent)
     {
-        m_nextCharCb = [trigger = std::move(nextCharEvent)](TriggerKey triggerKey) {
-            trigger(triggerKey);
+        m_nextCharCb = [trigger = std::move(nextCharEvent)](TriggerKey triggerKey, bool shiftPressed) {
+            trigger(triggerKey, shiftPressed);
         };
     }
 
@@ -144,6 +144,18 @@ namespace winrt::PowerToys::PowerAccentKeyboardService::implementation
     bool KeyboardListener::OnKeyDown(KBDLLHOOKSTRUCT info) noexcept
     {
         auto letterKey = static_cast<LetterKey>(info.vkCode);
+
+        // Shift key is detected only if the toolbar is already visible to avoid conflicts with uppercase
+        if (!m_leftShiftPressed && m_toolbarVisible && info.vkCode == VK_LSHIFT)
+        {
+            m_leftShiftPressed = true;
+        }
+
+        if (!m_rightShiftPressed && m_toolbarVisible && info.vkCode == VK_RSHIFT)
+        {
+            m_rightShiftPressed = true;
+        }
+
         if (std::find(letters.begin(), letters.end(), letterKey) != cend(letters) && m_isLanguageLetterCb(letterKey))
         {
             m_stopwatch.reset();
@@ -183,17 +195,17 @@ namespace winrt::PowerToys::PowerAccentKeyboardService::implementation
             if (triggerPressed == VK_LEFT)
             {
                 Logger::debug(L"Next toolbar position - left");
-                m_nextCharCb(TriggerKey::Left);
+                m_nextCharCb(TriggerKey::Left, m_leftShiftPressed || m_rightShiftPressed);
             }
             else if (triggerPressed == VK_RIGHT)
             {
                 Logger::debug(L"Next toolbar position - right");
-                m_nextCharCb(TriggerKey::Right);
+                m_nextCharCb(TriggerKey::Right, m_leftShiftPressed || m_rightShiftPressed);
             }
             else if (triggerPressed == VK_SPACE)
             {
                 Logger::debug(L"Next toolbar position - space");
-                m_nextCharCb(TriggerKey::Space);
+                m_nextCharCb(TriggerKey::Space, m_leftShiftPressed || m_rightShiftPressed);
             }
 
             return true;
@@ -204,6 +216,16 @@ namespace winrt::PowerToys::PowerAccentKeyboardService::implementation
 
     bool KeyboardListener::OnKeyUp(KBDLLHOOKSTRUCT info) noexcept
     {
+        if (m_leftShiftPressed && info.vkCode == VK_LSHIFT)
+        {
+            m_leftShiftPressed = false;
+        }
+
+        if (m_rightShiftPressed && info.vkCode == VK_RSHIFT)
+        {
+            m_rightShiftPressed = false;
+        }
+
         if (std::find(std::begin(letters), end(letters), static_cast<LetterKey>(info.vkCode)) != end(letters) && m_isLanguageLetterCb(static_cast<LetterKey>(info.vkCode)))
         {
             letterPressed = LetterKey::None;
diff --git a/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.h b/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.h
index 73e66611c7..c56f7c912a 100644
--- a/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.h
+++ b/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.h
@@ -52,10 +52,12 @@ namespace winrt::PowerToys::PowerAccentKeyboardService::implementation
         PowerAccentSettings m_settings;
         std::function<void(LetterKey)> m_showToolbarCb;
         std::function<void(InputType)> m_hideToolbarCb;
-        std::function<void(TriggerKey)> m_nextCharCb;
+        std::function<void(TriggerKey, bool)> m_nextCharCb;
         std::function<bool(LetterKey)> m_isLanguageLetterCb;
         bool m_triggeredWithSpace;
         spdlog::stopwatch m_stopwatch;
+        bool m_leftShiftPressed;
+        bool m_rightShiftPressed;
 
         std::mutex m_mutex_excluded_apps;
         std::pair<HWND, bool> m_prevForegrndAppExcl{ NULL, false };
diff --git a/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.idl b/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.idl
index 4877dce395..9cf0e7cbe4 100644
--- a/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.idl
+++ b/src/modules/poweraccent/PowerAccentKeyboardService/KeyboardListener.idl
@@ -60,7 +60,7 @@ namespace PowerToys
 
         [version(1.0), uuid(37197089-5438-4479-af57-30ab3f3c8be4)] delegate void ShowToolbar(LetterKey key);
         [version(1.0), uuid(8eb79d6b-1826-424f-9fbc-af21ae19725e)] delegate void HideToolbar(InputType inputType);
-        [version(1.0), uuid(db72d45c-a5a2-446f-bdc1-506e9121764a)] delegate void NextChar(TriggerKey inputSpace);
+        [version(1.0), uuid(db72d45c-a5a2-446f-bdc1-506e9121764a)] delegate void NextChar(TriggerKey inputSpace, boolean shiftPressed);
         [version(1.0), uuid(20be2919-2b91-4313-b6e0-4c3484fe91ef)] delegate void IsLanguageLetter(LetterKey key, [out] boolean* result);
 
         [default_interface] runtimeclass KeyboardListener {