diff --git a/.changeset/full-showers-serve.md b/.changeset/full-showers-serve.md
new file mode 100644
index 00000000000..242b674902f
--- /dev/null
+++ b/.changeset/full-showers-serve.md
@@ -0,0 +1,5 @@
+---
+'@clerk/clerk-react': patch
+---
+
+Ensure that useAuth() hook returns isLoaded=false when isomorphicClerk is loaded but we are in transitive state
diff --git a/packages/react/src/hooks/__tests__/useAuth.test.tsx b/packages/react/src/hooks/__tests__/useAuth.test.tsx
index fcffe1bdc17..a352e6c73b3 100644
--- a/packages/react/src/hooks/__tests__/useAuth.test.tsx
+++ b/packages/react/src/hooks/__tests__/useAuth.test.tsx
@@ -77,6 +77,39 @@ describe('useAuth', () => {
       );
     }).not.toThrow();
   });
+
+  test('returns isLoaded false when isomorphicClerk is loaded but in transitive state', () => {
+    const mockIsomorphicClerk = {
+      loaded: true,
+      telemetry: { record: vi.fn() },
+    };
+
+    const mockAuthContext = {
+      actor: undefined,
+      factorVerificationAge: null,
+      orgId: undefined,
+      orgPermissions: undefined,
+      orgRole: undefined,
+      orgSlug: undefined,
+      sessionClaims: null,
+      sessionId: undefined,
+      sessionStatus: undefined,
+      userId: undefined,
+    };
+
+    const { result } = renderHook(() => useAuth(), {
+      wrapper: ({ children }) => (
+        <ClerkInstanceContext.Provider value={{ value: mockIsomorphicClerk as any }}>
+          <AuthContext.Provider value={{ value: mockAuthContext as any }}>{children}</AuthContext.Provider>
+        </ClerkInstanceContext.Provider>
+      ),
+    });
+
+    expect(result.current.isLoaded).toBe(false);
+    expect(result.current.isSignedIn).toBeUndefined();
+    expect(result.current.sessionId).toBeUndefined();
+    expect(result.current.userId).toBeUndefined();
+  });
 });
 
 describe('useDerivedAuth', () => {
diff --git a/packages/react/src/hooks/useAuth.ts b/packages/react/src/hooks/useAuth.ts
index ba0da72f9cf..3a92f56aa6c 100644
--- a/packages/react/src/hooks/useAuth.ts
+++ b/packages/react/src/hooks/useAuth.ts
@@ -99,13 +99,9 @@ export const useAuth = (initialAuthStateOrOptions: UseAuthOptions = {}): UseAuth
   const initialAuthState = rest as any;
 
   const authContextFromHook = useAuthContext();
-  let authContext = authContextFromHook;
-
-  if (authContext.sessionId === undefined && authContext.userId === undefined) {
-    authContext = initialAuthState != null ? initialAuthState : {};
-  }
-
   const isomorphicClerk = useIsomorphicClerkContext();
+  const authContext = !isomorphicClerk.loaded && initialAuthState ? initialAuthState : authContextFromHook;
+
   const getToken: GetToken = useCallback(createGetToken(isomorphicClerk), [isomorphicClerk]);
   const signOut: SignOut = useCallback(createSignOut(isomorphicClerk), [isomorphicClerk]);