diff --git a/packages/playwright-ct-angular/registerSource.mjs b/packages/playwright-ct-angular/registerSource.mjs
index e23c99c7f85a2..997be15e4dd2d 100644
--- a/packages/playwright-ct-angular/registerSource.mjs
+++ b/packages/playwright-ct-angular/registerSource.mjs
@@ -18,9 +18,15 @@
 // This file is injected into the registry as text, no dependencies are allowed.
 
 import 'zone.js';
+import {
+  Component as defineComponent,
+  reflectComponentType
+} from '@angular/core';
 import { getTestBed, TestBed } from '@angular/core/testing';
-import { BrowserDynamicTestingModule, platformBrowserDynamicTesting } from '@angular/platform-browser-dynamic/testing';
-import { EventEmitter, reflectComponentType, Component as defineComponent } from '@angular/core';
+import {
+  BrowserDynamicTestingModule,
+  platformBrowserDynamicTesting,
+} from '@angular/platform-browser-dynamic/testing';
 import { Router } from '@angular/router';
 
 /** @typedef {import('@playwright/experimental-ct-core/types/component').Component} Component */
@@ -34,6 +40,8 @@ const __pwLoaderRegistry = new Map();
 const __pwRegistry = new Map();
 /** @type {Map<string, import('@angular/core/testing').ComponentFixture>} */
 const __pwFixtureRegistry = new Map();
+/** @type {WeakMap<import('@angular/core/testing').ComponentFixture, Record<string, import('rxjs').Subscription>>} */
+const __pwOutputSubscriptionRegistry = new WeakMap();
 
 getTestBed().initTestEnvironment(
     BrowserDynamicTestingModule,
@@ -96,12 +104,22 @@ function __pwUpdateProps(fixture, props = {}) {
  * @param {import('@angular/core/testing').ComponentFixture} fixture
  */
 function __pwUpdateEvents(fixture, events = {}) {
-  for (const [name, value] of Object.entries(events)) {
-    fixture.debugElement.children[0].componentInstance[name] = {
-      ...new EventEmitter(),
-      emit: event => value(event)
-    };
+  const outputSubscriptionRecord =
+    __pwOutputSubscriptionRegistry.get(fixture) ?? {};
+  for (const [name, listener] of Object.entries(events)) {
+    /* Unsubscribe previous listener. */
+    outputSubscriptionRecord[name]?.unsubscribe();
+
+    const subscription = fixture.debugElement.children[0].componentInstance[
+      name
+    ].subscribe((event) => listener(event));
+
+    /* Store new subscription. */
+    outputSubscriptionRecord[name] = subscription;
   }
+
+  /* Update output subscription registry. */
+  __pwOutputSubscriptionRegistry.set(fixture, outputSubscriptionRecord);
 }
 
 function __pwUpdateSlots(Component, slots = {}, tagName) {
@@ -211,8 +229,12 @@ window.playwrightMount = async (component, rootElement, hooksConfig) => {
 
 window.playwrightUnmount = async rootElement => {
   const fixture = __pwFixtureRegistry.get(rootElement.id);
-  if (!fixture)
-    throw new Error('Component was not mounted');
+  if (!fixture) throw new Error('Component was not mounted');
+
+  /* Unsubscribe from all outputs. */
+  for (const subscription of Object.values(__pwOutputSubscriptionRegistry.get(fixture) ?? {}))
+    subscription?.unsubscribe();
+  __pwOutputSubscriptionRegistry.delete(fixture);
 
   fixture.destroy();
   fixture.nativeElement.replaceChildren();
diff --git a/tests/components/ct-angular/src/components/output.component.ts b/tests/components/ct-angular/src/components/output.component.ts
new file mode 100644
index 0000000000000..5aaacb95a43a7
--- /dev/null
+++ b/tests/components/ct-angular/src/components/output.component.ts
@@ -0,0 +1,17 @@
+import { DOCUMENT } from "@angular/common";
+import { Component, Output, inject } from "@angular/core";
+import { Subject, finalize } from "rxjs";
+
+@Component({
+  standalone: true,
+  template: `OutputComponent`,
+})
+export class OutputComponent {
+  @Output() answerChange = new Subject().pipe(
+    /* Detect when observable is unsubscribed from, 
+     * and set a global variable `hasUnsubscribed` to true. */
+    finalize(() => ((this._window as any).hasUnsubscribed = true))
+  );
+
+  private _window = inject(DOCUMENT).defaultView;
+}
diff --git a/tests/components/ct-angular/tests/events.spec.ts b/tests/components/ct-angular/tests/events.spec.ts
index a4f67d72026e3..b11194ab9084e 100644
--- a/tests/components/ct-angular/tests/events.spec.ts
+++ b/tests/components/ct-angular/tests/events.spec.ts
@@ -1,5 +1,6 @@
 import { test, expect } from '@playwright/experimental-ct-angular';
 import { ButtonComponent } from '@/components/button.component';
+import { OutputComponent } from '@/components/output.component';
 
 test('emit an submit event when the button is clicked', async ({ mount }) => {
   const messages: string[] = [];
@@ -14,3 +15,49 @@ test('emit an submit event when the button is clicked', async ({ mount }) => {
   await component.click();
   expect(messages).toEqual(['hello']);
 });
+
+test('replace existing listener when new listener is set', async ({
+  mount,
+}) => {
+  let count = 0;
+
+  const component = await mount(ButtonComponent, {
+    props: {
+      title: 'Submit',
+    },
+    on: {
+      submit() {
+        count++;
+      },
+    },
+  });
+
+  component.update({
+    on: {
+      submit() {
+        count++;
+      },
+    },
+  });
+
+  await component.click();
+  expect(count).toBe(1);
+});
+
+test('unsubscribe from events when the component is unmounted', async ({
+  mount,
+  page,
+}) => {
+  const component = await mount(OutputComponent, {
+    on: {
+      answerChange() {},
+    },
+  });
+
+  await component.unmount();
+
+  /* Check that the output observable had been unsubscribed from
+   * as it sets a global variable `hasUnusbscribed` to true
+   * when it detects unsubscription. Cf. OutputComponent. */
+  expect(await page.evaluate(() => (window as any).hasUnsubscribed)).toBe(true);
+});