diff --git a/CLAUDE.md b/CLAUDE.md
index a7987720b3..fe6d39bc11 100644
--- a/CLAUDE.md
+++ b/CLAUDE.md
@@ -73,6 +73,8 @@ motion (public API)
 
 ## Writing Tests
 
+**IMPORTANT: Always write a failing test FIRST before implementing any bug fix or feature.** This ensures the issue is reproducible and the fix is verified. For UI interaction bugs (like gesture handling), prefer E2E tests using Playwright or Cypress.
+
 When waiting for the next frame in async tests:
 
 ```javascript
diff --git a/dev/react/src/tests/drag-input-propagation.tsx b/dev/react/src/tests/drag-input-propagation.tsx
new file mode 100644
index 0000000000..61fb5e0f45
--- /dev/null
+++ b/dev/react/src/tests/drag-input-propagation.tsx
@@ -0,0 +1,112 @@
+import { motion } from "framer-motion"
+
+/**
+ * Test page for issue #1674: Interactive elements inside draggable elements
+ * should not trigger drag when clicked/interacted with.
+ */
+export const App = () => {
+    return (
+        <div style={{ padding: 100 }}>
+            <motion.div
+                id="draggable"
+                data-testid="draggable"
+                drag
+                dragElastic={0}
+                dragMomentum={false}
+                style={{
+                    width: 400,
+                    height: 200,
+                    background: "red",
+                    display: "flex",
+                    flexWrap: "wrap",
+                    alignItems: "center",
+                    justifyContent: "center",
+                    gap: 10,
+                    padding: 10,
+                }}
+            >
+                <input
+                    type="text"
+                    data-testid="input"
+                    defaultValue="Select me"
+                    style={{
+                        width: 80,
+                        height: 30,
+                        padding: 5,
+                    }}
+                />
+                <textarea
+                    data-testid="textarea"
+                    defaultValue="Text"
+                    style={{
+                        width: 60,
+                        height: 30,
+                        padding: 5,
+                    }}
+                />
+                <button
+                    data-testid="button"
+                    style={{
+                        width: 60,
+                        height: 30,
+                        padding: 5,
+                    }}
+                >
+                    Click
+                </button>
+                <a
+                    href="#test"
+                    data-testid="link"
+                    style={{
+                        display: "inline-block",
+                        width: 60,
+                        height: 30,
+                        padding: 5,
+                        background: "white",
+                    }}
+                >
+                    Link
+                </a>
+                <select
+                    data-testid="select"
+                    style={{
+                        width: 80,
+                        height: 30,
+                    }}
+                >
+                    <option value="1">Option 1</option>
+                    <option value="2">Option 2</option>
+                    <option value="3">Option 3</option>
+                </select>
+                <label
+                    data-testid="label"
+                    style={{
+                        display: "flex",
+                        alignItems: "center",
+                        gap: 5,
+                        background: "white",
+                        padding: 5,
+                    }}
+                >
+                    <input
+                        type="checkbox"
+                        data-testid="checkbox"
+                    />
+                    Check
+                </label>
+                <div
+                    contentEditable
+                    data-testid="contenteditable"
+                    style={{
+                        width: 80,
+                        height: 30,
+                        padding: 5,
+                        background: "white",
+                    }}
+                >
+                    Edit me
+                </div>
+            </motion.div>
+        </div>
+    )
+}
diff --git a/packages/framer-motion/cypress/integration/drag-input-propagation.ts b/packages/framer-motion/cypress/integration/drag-input-propagation.ts
new file mode 100644
index 0000000000..0fafbb74e3
--- /dev/null
+++ b/packages/framer-motion/cypress/integration/drag-input-propagation.ts
@@ -0,0 +1,222 @@
+/**
+ * Tests for issue #1674: Interactive elements inside draggable elements should not trigger drag
+ * https://github.com/motiondivision/motion/issues/1674
+ */
+describe("Drag Input Propagation", () => {
+    it("Should not drag when clicking and dragging on an input inside draggable", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                // Initial position is at padding: 100
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+
+        // Attempt to drag by clicking on the input
+        cy.get("[data-testid='input']")
+            .trigger("pointerdown", 5, 5)
+            .trigger("pointermove", 10, 10)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+
+        // Verify the draggable element did NOT move
+        cy.get("[data-testid='draggable']").should(($draggable) => {
+            const { left, top } = $draggable[0].getBoundingClientRect()
+            // Element should still be at its initial position
+            expect(left).to.equal(100)
+            expect(top).to.equal(100)
+        })
+    })
+
+    it("Should not drag when clicking and dragging on a textarea inside draggable", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+
+        // Attempt to drag by clicking on the textarea
+        cy.get("[data-testid='textarea']")
+            .trigger("pointerdown", 5, 5)
+            .trigger("pointermove", 10, 10)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+
+        // Verify the draggable element did NOT move
+        cy.get("[data-testid='draggable']").should(($draggable) => {
+            const { left, top } = $draggable[0].getBoundingClientRect()
+            // Element should still be at its initial position
+            expect(left).to.equal(100)
+            expect(top).to.equal(100)
+        })
+    })
+
+    it("Should not drag when clicking and dragging on a button inside draggable", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+
+        // Attempt to drag by clicking on the button
+        cy.get("[data-testid='button']")
+            .trigger("pointerdown", 5, 5)
+            .trigger("pointermove", 10, 10)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+
+        // Verify the draggable element did NOT move
+        cy.get("[data-testid='draggable']").should(($draggable) => {
+            const { left, top } = $draggable[0].getBoundingClientRect()
+            expect(left).to.equal(100)
+            expect(top).to.equal(100)
+        })
+    })
+
+    it("Should not drag when clicking and dragging on a link inside draggable", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+
+        // Attempt to drag by clicking on the link
+        cy.get("[data-testid='link']")
+            .trigger("pointerdown", 5, 5)
+            .trigger("pointermove", 10, 10)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+
+        // Verify the draggable element did NOT move
+        cy.get("[data-testid='draggable']").should(($draggable) => {
+            const { left, top } = $draggable[0].getBoundingClientRect()
+            expect(left).to.equal(100)
+            expect(top).to.equal(100)
+        })
+    })
+
+    it("Should not drag when clicking and dragging on a select inside draggable", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+
+        // Attempt to drag by clicking on the select
+        cy.get("[data-testid='select']")
+            .trigger("pointerdown", 5, 5)
+            .trigger("pointermove", 10, 10)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+
+        // Verify the draggable element did NOT move
+        cy.get("[data-testid='draggable']").should(($draggable) => {
+            const { left, top } = $draggable[0].getBoundingClientRect()
+            expect(left).to.equal(100)
+            expect(top).to.equal(100)
+        })
+    })
+
+    it("Should not drag when clicking and dragging on a checkbox inside a label inside draggable", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+
+        // Attempt to drag by clicking on the checkbox (nested inside label)
+        cy.get("[data-testid='checkbox']")
+            .trigger("pointerdown", 2, 2)
+            .trigger("pointermove", 5, 5)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+
+        // Verify the draggable element did NOT move
+        cy.get("[data-testid='draggable']").should(($draggable) => {
+            const { left, top } = $draggable[0].getBoundingClientRect()
+            expect(left).to.equal(100)
+            expect(top).to.equal(100)
+        })
+    })
+
+    it("Should not drag when clicking and dragging on a contenteditable element inside draggable", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+
+        // Attempt to drag by clicking on the contenteditable element
+        cy.get("[data-testid='contenteditable']")
+            .trigger("pointerdown", 5, 5)
+            .trigger("pointermove", 10, 10)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+
+        // Verify the draggable element did NOT move
+        cy.get("[data-testid='draggable']").should(($draggable) => {
+            const { left, top } = $draggable[0].getBoundingClientRect()
+            expect(left).to.equal(100)
+            expect(top).to.equal(100)
+        })
+    })
+
+    it("Should still drag when clicking on the draggable area outside interactive elements", () => {
+        cy.visit("?test=drag-input-propagation")
+            .wait(200)
+            .get("[data-testid='draggable']")
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                expect(left).to.equal(100)
+                expect(top).to.equal(100)
+            })
+            // Click on edge of draggable, not on interactive elements (at coordinates 5,5 which is top-left corner)
+            .trigger("pointerdown", 5, 5)
+            .trigger("pointermove", 10, 10)
+            .wait(50)
+            .trigger("pointermove", 200, 200, { force: true })
+            .wait(50)
+            .trigger("pointerup", { force: true })
+            .should(($draggable) => {
+                const { left, top } = $draggable[0].getBoundingClientRect()
+                // Element should have moved - the exact position depends on gesture calculation
+                // but should NOT be at original position of 100,100
+                expect(left).to.be.greaterThan(200)
+                expect(top).to.be.greaterThan(200)
+            })
+    })
+})
diff --git a/packages/framer-motion/src/gestures/drag/VisualElementDragControls.ts b/packages/framer-motion/src/gestures/drag/VisualElementDragControls.ts
index 848d0285fb..6ec6c5546a 100644
--- a/packages/framer-motion/src/gestures/drag/VisualElementDragControls.ts
+++ b/packages/framer-motion/src/gestures/drag/VisualElementDragControls.ts
@@ -1,4 +1,5 @@
 import {
+    isElementKeyboardAccessible,
     PanInfo,
     ResolvedConstraints,
     Transition,
@@ -643,7 +644,13 @@ export class VisualElementDragControls {
             "pointerdown",
             (event) => {
                 const { drag, dragListener = true } = this.getProps()
-                drag && dragListener && this.start(event)
+                if (
+                    drag &&
+                    dragListener &&
+                    !isElementKeyboardAccessible(event.target as Element)
+                ) {
+                    this.start(event)
+                }
             }
         )
 
diff --git a/packages/motion-dom/src/gestures/press/utils/is-keyboard-accessible.ts b/packages/motion-dom/src/gestures/press/utils/is-keyboard-accessible.ts
index 1e38087085..a22b9be82d 100644
--- a/packages/motion-dom/src/gestures/press/utils/is-keyboard-accessible.ts
+++ b/packages/motion-dom/src/gestures/press/utils/is-keyboard-accessible.ts
@@ -1,4 +1,4 @@
-const focusableElements = new Set([
+const interactiveElements = new Set([
     "BUTTON",
     "INPUT",
     "SELECT",
@@ -6,9 +6,17 @@ const focusableElements = new Set([
     "A",
 ])
 
+/**
+ * Checks if an element is an interactive form element that should prevent
+ * drag gestures from starting when clicked.
+ *
+ * This specifically targets form controls, buttons, and links - not just any
+ * element with tabIndex, since motion elements with tap handlers automatically
+ * get tabIndex=0 for keyboard accessibility.
+ */
 export function isElementKeyboardAccessible(element: Element) {
     return (
-        focusableElements.has(element.tagName) ||
-        (element as HTMLElement).tabIndex !== -1
+        interactiveElements.has(element.tagName) ||
+        (element as HTMLElement).isContentEditable === true
     )
 }
diff --git a/packages/motion-dom/src/index.ts b/packages/motion-dom/src/index.ts
index a138e4c63f..571e450a9b 100644
--- a/packages/motion-dom/src/index.ts
+++ b/packages/motion-dom/src/index.ts
@@ -56,6 +56,7 @@ export * from "./gestures/hover"
 export * from "./gestures/pan/types"
 export * from "./gestures/press"
 export * from "./gestures/press/types"
+export * from "./gestures/press/utils/is-keyboard-accessible"
 export * from "./gestures/types"
 export * from "./gestures/utils/is-node-or-child"
 export * from "./gestures/utils/is-primary-pointer"