diff --git a/packages/devextreme/js/__internal/grids/grid_core/focus/m_focus.ts b/packages/devextreme/js/__internal/grids/grid_core/focus/m_focus.ts
index 64ff302709dd..998d184db813 100644
--- a/packages/devextreme/js/__internal/grids/grid_core/focus/m_focus.ts
+++ b/packages/devextreme/js/__internal/grids/grid_core/focus/m_focus.ts
@@ -469,15 +469,18 @@ export const focusModule = {
           this.option('focusedColumnIndex', columnIndex);
         },
 
-        _escapeKeyHandler(eventArgs, isEditing) {
+        _escapeKeyHandler(eventArgs, isEditing): boolean {
           if (isEditing || !this.option('focusedRowEnabled')) {
-            this.callBase(eventArgs, isEditing);
-            return;
+            return this.callBase(eventArgs, isEditing);
           }
           if (this.isCellFocusType()) {
             this.setRowFocusType();
             this._focus(this._getCellElementFromTarget(eventArgs.originalEvent.target), true);
+
+            return true;
           }
+
+          return false;
         },
 
         _updateFocusedCellPosition($cell, direction) {
diff --git a/packages/devextreme/js/__internal/grids/grid_core/keyboard_navigation/m_keyboard_navigation.ts b/packages/devextreme/js/__internal/grids/grid_core/keyboard_navigation/m_keyboard_navigation.ts
index 5981cc9d5829..fcc003333977 100644
--- a/packages/devextreme/js/__internal/grids/grid_core/keyboard_navigation/m_keyboard_navigation.ts
+++ b/packages/devextreme/js/__internal/grids/grid_core/keyboard_navigation/m_keyboard_navigation.ts
@@ -472,8 +472,7 @@ export class KeyboardNavigationController extends modules.ViewController {
           break;
 
         case 'escape':
-          this._escapeKeyHandler(e, isEditing);
-          isHandled = true;
+          isHandled = this._escapeKeyHandler(e, isEditing);
           break;
 
         case 'F':
@@ -1060,7 +1059,7 @@ export class KeyboardNavigationController extends modules.ViewController {
     }
   }
 
-  _escapeKeyHandler(eventArgs, isEditing) {
+  _escapeKeyHandler(eventArgs, isEditing): boolean {
     const $cell = this._getCellElementFromTarget(
       eventArgs.originalEvent.target,
     );
@@ -1081,7 +1080,11 @@ export class KeyboardNavigationController extends modules.ViewController {
         }
       }
       eventArgs.originalEvent.preventDefault();
+
+      return true;
     }
+
+    return false;
   }
 
   _ctrlFKeyHandler(eventArgs) {
diff --git a/packages/devextreme/testing/tests/DevExpress.ui.widgets.dataGrid/keyboardNavigation.keyboardKeys.tests.js b/packages/devextreme/testing/tests/DevExpress.ui.widgets.dataGrid/keyboardNavigation.keyboardKeys.tests.js
index e9c229c35a1f..2081b2aeff91 100644
--- a/packages/devextreme/testing/tests/DevExpress.ui.widgets.dataGrid/keyboardNavigation.keyboardKeys.tests.js
+++ b/packages/devextreme/testing/tests/DevExpress.ui.widgets.dataGrid/keyboardNavigation.keyboardKeys.tests.js
@@ -2064,6 +2064,24 @@ QUnit.module('Keyboard keys', {
         assert.ok(!this.editingController.hasEditData(), 'grid hasn\'t unsaved data');
     });
 
+    // T1202731
+    QUnit.testInActiveWindow('Escape should bubble up when any grid action was not executed', function(assert) {
+        // arrange
+        const $container = $('#container');
+
+        setupModules(this);
+
+        this.gridView.render($container);
+        this.focusFirstCell();
+
+        const e = $.Event('keydown', { key: 'escape' });
+        $($container.find('.dx-datagrid-rowsview')).trigger(e);
+        this.clock.tick(10);
+
+        // assert
+        assert.ok(!e.isPropagationStopped(), 'propagation is not stopped');
+    });
+
     QUnit.testInActiveWindow('Editing by enter key is not worked when editing is disabled', function(assert) {
         // arrange
         const $container = $('#container');