diff --git a/toolkit/components/autocomplete/nsAutoCompleteController.cpp b/toolkit/components/autocomplete/nsAutoCompleteController.cpp
index 64791fd756f1..aab27651fd06 100644
--- a/toolkit/components/autocomplete/nsAutoCompleteController.cpp
+++ b/toolkit/components/autocomplete/nsAutoCompleteController.cpp
@@ -1149,6 +1149,9 @@ nsresult nsAutoCompleteController::EnterMatch(bool aIsPopupSelection,
   bool forceComplete;
   input->GetForceComplete(&forceComplete);
 
+  int32_t selectedIndex;
+  popup->GetSelectedIndex(&selectedIndex);
+
   // Ask the popup if it wants to enter a special value into the textbox
   nsAutoString value;
   popup->GetOverrideValue(value);
@@ -1158,8 +1161,6 @@ nsresult nsAutoCompleteController::EnterMatch(bool aIsPopupSelection,
     bool completeSelection;
     input->GetCompleteSelectedIndex(&completeSelection);
 
-    int32_t selectedIndex;
-    popup->GetSelectedIndex(&selectedIndex);
     if (selectedIndex >= 0) {
       nsAutoString inputValue;
       input->GetTextValue(inputValue);
@@ -1268,7 +1269,8 @@ nsresult nsAutoCompleteController::EnterMatch(bool aIsPopupSelection,
   ClosePopup();
 
   bool cancel;
-  input->OnTextEntered(aEvent, &cancel);
+  bool itemWasSelected = selectedIndex >= 0;
+  input->OnTextEntered(aEvent, itemWasSelected, &cancel);
 
   return NS_OK;
 }
diff --git a/toolkit/components/autocomplete/nsIAutoCompleteInput.idl b/toolkit/components/autocomplete/nsIAutoCompleteInput.idl
index 2326ad137a09..eddc3baac7c5 100644
--- a/toolkit/components/autocomplete/nsIAutoCompleteInput.idl
+++ b/toolkit/components/autocomplete/nsIAutoCompleteInput.idl
@@ -137,9 +137,12 @@ interface nsIAutoCompleteInput : nsISupports
    *
    * @param aEvent
    *        The event that triggered the enter.
+   * @param itemWasSelected
+   *        A boolean value that indicates whether
+   *        an item was selected from the autocomplete popup.
    * @return True if the user wishes to prevent the enter
    */
-  boolean onTextEntered([optional] in Event aEvent);
+  boolean onTextEntered([optional] in Event aEvent, [optional] in boolean itemWasSelected);
 
   /*
    * Notification that the user cancelled the autocomplete session
diff --git a/toolkit/components/passwordmgr/LoginManagerContent.jsm b/toolkit/components/passwordmgr/LoginManagerContent.jsm
index a25b4db0e069..cd99ccb83f64 100644
--- a/toolkit/components/passwordmgr/LoginManagerContent.jsm
+++ b/toolkit/components/passwordmgr/LoginManagerContent.jsm
@@ -104,6 +104,14 @@ var observer = {
     }
 
     switch (aEvent.type) {
+      case "keydown": {
+        if (aEvent.keyCode == aEvent.DOM_VK_TAB ||
+            aEvent.keyCode == aEvent.DOM_VK_RETURN) {
+          LoginManagerContent.onUsernameInput(aEvent);
+        }
+        break;
+      }
+
       // Only used for username fields.
       case "focus": {
         LoginManagerContent._onUsernameFocus(aEvent);
@@ -716,6 +724,8 @@ var LoginManagerContent = {
 
     if (LoginHelper.isUsernameFieldType(acInputField)) {
       this.onUsernameInput(event);
+    } else if (acInputField.hasBeenTypePassword) {
+      this._highlightFilledField(event.target);
     }
   },
 
@@ -1238,6 +1248,7 @@ var LoginManagerContent = {
       // warning, regardless of saved login.
       if (usernameField) {
         this._formFillService.markAsLoginManagerField(usernameField);
+        usernameField.addEventListener("keydown", observer);
       }
 
       // Nothing to do if we have no matching logins available.
diff --git a/toolkit/components/passwordmgr/test/mochitest/test_autocomplete_highlight.html b/toolkit/components/passwordmgr/test/mochitest/test_autocomplete_highlight.html
index 8514e2b4170c..9586a2861416 100644
--- a/toolkit/components/passwordmgr/test/mochitest/test_autocomplete_highlight.html
+++ b/toolkit/components/passwordmgr/test/mochitest/test_autocomplete_highlight.html
@@ -69,8 +69,8 @@ add_task(async function test_field_highlight_on_autocomplete() {
         "Highlight was successfully applied to the password field on username autocomplete");
 
   // Clear existing highlight on login fields. We check by pressing the tab key after backspace
-  // (by shifting focus to the next element) because the tab key is known to cause a bug where the
-  // highlight is applied once again.
+  // (by shifting focus to the next element) because the tab key was known to cause a bug where the
+  // highlight is applied once again. See Bug 1526522.
   username.focus();
   synthesizeKey("KEY_Backspace");
   synthesizeKey("KEY_Tab");
@@ -81,6 +81,31 @@ add_task(async function test_field_highlight_on_autocomplete() {
   synthesizeKey("KEY_Tab");
   is(document.defaultView.getComputedStyle(password).getPropertyValue("filter"), "none",
      "Highlight was successfully removed on the password field");
+
+  // Clear login fields.
+  username.value = "";
+  password.value = "";
+
+  // Test password field autocomplete.
+  password.focus();
+  shownPromise = promiseACShown();
+  synthesizeKey("KEY_ArrowDown");
+  await shownPromise;
+  synthesizeKey("KEY_ArrowDown");
+  synthesizeKey("KEY_Enter");
+
+  await ContentTaskUtils.waitForCondition(() => {
+    return document.defaultView.getComputedStyle(password).getPropertyValue("filter") !== "none";
+  }, "Highlight was successfully applied to the password field on password autocomplete");
+
+  // Clear existing highlight on the password field. We check by pressing the tab key after backspace
+  // (by shifting focus to the next element) because the tab key was known to cause a bug where the
+  // highlight is applied once again. See Bug 1526522.
+  synthesizeKey("KEY_Backspace");
+  synthesizeKey("KEY_Tab");
+
+  is(document.defaultView.getComputedStyle(password).getPropertyValue("filter"), "none",
+     "Highlight was successfully removed on the password field");
 });
 </script>
 </body>
diff --git a/toolkit/components/satchel/nsFormFillController.cpp b/toolkit/components/satchel/nsFormFillController.cpp
index 146754d9189f..900c880b7d68 100644
--- a/toolkit/components/satchel/nsFormFillController.cpp
+++ b/toolkit/components/satchel/nsFormFillController.cpp
@@ -592,9 +592,21 @@ NS_IMETHODIMP
 nsFormFillController::OnSearchComplete() { return NS_OK; }
 
 NS_IMETHODIMP
-nsFormFillController::OnTextEntered(Event* aEvent, bool* aPrevent) {
+nsFormFillController::OnTextEntered(Event* aEvent, bool itemWasSelected,
+                                    bool* aPrevent) {
   NS_ENSURE_ARG(aPrevent);
   NS_ENSURE_TRUE(mFocusedInput, NS_OK);
+
+  /**
+   * This function can get called when text wasn't actually entered
+   * into the field (e.g. if an autocomplete item wasn't selected) so
+   * we don't fire DOMAutoComplete in that case since nothing
+   * was actually autocompleted.
+   */
+  if (!itemWasSelected) {
+    return NS_OK;
+  }
+
   // Fire off a DOMAutoComplete event
 
   IgnoredErrorResult ignored;