diff --git a/src/vs/workbench/common/theme.ts b/src/vs/workbench/common/theme.ts
index 55593fd5eb3..3db14376cd7 100644
--- a/src/vs/workbench/common/theme.ts
+++ b/src/vs/workbench/common/theme.ts
@@ -720,7 +720,7 @@ export const MODERN_EDITOR_TAB_SELECTED_ACTION_BACKGROUND = registerColor('moder
 
 export const MODERN_ACTIVITY_BAR_BACKGROUND = registerColor('modernActivityBar.background', ACTIVITY_BAR_BACKGROUND, localize('modernActivityBarBackground', "Background color of the Activity bar in the default side position when the modern UI is enabled."));
 
-export const MODERN_ACTIVITY_BAR_INACTIVE_BACKGROUND = registerColor('modernActivityBar.inactiveBackground', ACTIVITY_BAR_BACKGROUND, localize('modernActivityBarInactiveBackground', "Background color of the Activity bar in an inactive window when it is in the default side position and the modern UI is enabled."));
+export const MODERN_ACTIVITY_BAR_INACTIVE_BACKGROUND = registerColor('modernActivityBar.inactiveBackground', MODERN_ACTIVITY_BAR_BACKGROUND, localize('modernActivityBarInactiveBackground', "Background color of the Activity bar in an inactive window when it is in the default side position and the modern UI is enabled."));
 
 export const MODERN_ACTIVITY_BAR_ACTIVE_BACKGROUND = registerColor('modernActivityBar.activeBackground', MODERN_TAB_ACTIVE_BACKGROUND, localize('modernActivityBarActiveBackground', "Background color of active Activity bar items in the default side position when the modern UI is enabled."));
 
diff --git a/src/vs/workbench/contrib/modernUI/README.md b/src/vs/workbench/contrib/modernUI/README.md
index a8b322ed5e6..e0969fb07cd 100644
--- a/src/vs/workbench/contrib/modernUI/README.md
+++ b/src/vs/workbench/contrib/modernUI/README.md
@@ -23,7 +23,7 @@ Modern UI uses the standard workbench color theme system. Theme authors can use
 | `modernEditorTab.hoverForeground` | Foreground of hovered Modern UI editor tabs | `modernTab.hoverForeground` |
 | `modernEditorTab.selectedActionBackground` | Opaque background of actions on selected Modern UI editor tabs | `tab.selectedBackground` composited over `editor.background` |
 | `modernActivityBar.background` | Background of the Modern UI activity bar | `activityBar.background` |
-| `modernActivityBar.inactiveBackground` | Background of the Modern UI activity bar in an inactive window | `activityBar.background` |
+| `modernActivityBar.inactiveBackground` | Background of the Modern UI activity bar in an inactive window | `modernActivityBar.background` |
 | `modernActivityBar.activeBackground` | Background of active Modern UI activity bar items in the default side position | `modernTab.activeBackground` |
 | `modernActivityBar.activeForeground` | Foreground of active Modern UI activity bar items in the default side position | `modernTab.activeForeground` |
 | `modernActivityBar.hoverBackground` | Background of hovered Modern UI activity bar items in the default side position | `modernTab.hoverBackground` |
diff --git a/src/vs/workbench/contrib/modernUI/test/browser/modernUI.contribution.test.ts b/src/vs/workbench/contrib/modernUI/test/browser/modernUI.contribution.test.ts
index bab5efda498..35564e25188 100644
--- a/src/vs/workbench/contrib/modernUI/test/browser/modernUI.contribution.test.ts
+++ b/src/vs/workbench/contrib/modernUI/test/browser/modernUI.contribution.test.ts
@@ -546,6 +546,19 @@ suite('ModernUIContribution', () => {
 		});
 	});
 
+	test('inherits the customized activity bar background when inactive', () => {
+		const theme = ColorThemeData.createUnloadedTheme('vs-dark');
+		theme.setCustomColors({ [MODERN_ACTIVITY_BAR_BACKGROUND]: '#123456' });
+
+		assert.deepStrictEqual({
+			background: theme.getColor(MODERN_ACTIVITY_BAR_BACKGROUND)?.toString(),
+			inactiveBackground: theme.getColor(MODERN_ACTIVITY_BAR_INACTIVE_BACKGROUND)?.toString(),
+		}, {
+			background: '#123456',
+			inactiveBackground: '#123456',
+		});
+	});
+
 	test('hides collapsed primary side bar grips without hiding constrained auxiliary sash grips', () => {
 		const root = document.createElement('div');
 		root.className = 'monaco-workbench modern-ui nosidebar nopanel';