diff --git a/packages/features/bookings/lib/handleSeats/create/createNewSeat.ts b/packages/features/bookings/lib/handleSeats/create/createNewSeat.ts
index 7b19d2848e..1577b086b2 100644
--- a/packages/features/bookings/lib/handleSeats/create/createNewSeat.ts
+++ b/packages/features/bookings/lib/handleSeats/create/createNewSeat.ts
@@ -47,7 +47,10 @@ const createNewSeat = async (
 
   evt = { ...evt, attendees: [...bookingAttendees, invitee[0]] };
 
-  if (eventType.seatsPerTimeSlot && eventType.seatsPerTimeSlot <= seatedBooking.attendees.length) {
+  if (
+    eventType.seatsPerTimeSlot &&
+    eventType.seatsPerTimeSlot <= seatedBooking.attendees.filter((attendee) => !!attendee.bookingSeat).length
+  ) {
     throw new HttpError({ statusCode: 409, message: ErrorCode.BookingSeatsFull });
   }
 
diff --git a/packages/features/bookings/lib/handleSeats/test/handleSeats.test.ts b/packages/features/bookings/lib/handleSeats/test/handleSeats.test.ts
index c19fa48758..9acbf31cd9 100644
--- a/packages/features/bookings/lib/handleSeats/test/handleSeats.test.ts
+++ b/packages/features/bookings/lib/handleSeats/test/handleSeats.test.ts
@@ -5,6 +5,8 @@ import {
   TestData,
   getOrganizer,
   createBookingScenario,
+  getGoogleCalendarCredential,
+  Timezones,
   getScenarioData,
   mockSuccessfulVideoMeetingCreation,
   BookingLocations,
@@ -20,6 +22,7 @@ import { describe, test, vi, expect } from "vitest";
 
 import { appStoreMetadata } from "@calcom/app-store/apps.metadata.generated";
 import { ErrorCode } from "@calcom/lib/errorCodes";
+import { SchedulingType } from "@calcom/prisma/enums";
 import { BookingStatus } from "@calcom/prisma/enums";
 
 import * as handleSeatsModule from "../handleSeats";
@@ -873,6 +876,186 @@ describe("handleSeats", () => {
 
         await expect(() => handleNewBooking(req)).rejects.toThrowError(ErrorCode.BookingSeatsFull);
       });
+
+      test("Verify Seat Availability Calculation Based on Booked Seats, Not Total Attendees", async () => {
+        const handleNewBooking = (await import("@calcom/features/bookings/lib/handleNewBooking")).default;
+
+        const booker = getBooker({
+          email: "seat2@example.com",
+          name: "Seat 2",
+        });
+
+        const organizer = getOrganizer({
+          name: "Organizer",
+          email: "organizer@example.com",
+          id: 101,
+          defaultScheduleId: null,
+          schedules: [TestData.schedules.IstMorningShift],
+          credentials: [getGoogleCalendarCredential()],
+          selectedCalendars: [TestData.selectedCalendars.google],
+          destinationCalendar: {
+            integration: TestData.apps["google-calendar"].type,
+            externalId: "organizer@google-calendar.com",
+          },
+        });
+
+        const otherTeamMembers = [
+          {
+            name: "Other Team Member 1",
+            username: "other-team-member-1",
+            timeZone: Timezones["+5:30"],
+            defaultScheduleId: null,
+            email: "other-team-member-1@example.com",
+            id: 102,
+            schedules: [TestData.schedules.IstEveningShift],
+            credentials: [getGoogleCalendarCredential()],
+            selectedCalendars: [TestData.selectedCalendars.google],
+            destinationCalendar: {
+              integration: TestData.apps["google-calendar"].type,
+              externalId: "other-team-member-1@google-calendar.com",
+            },
+          },
+        ];
+
+        const bookingId = 1;
+        const bookingUid = "abc123";
+        const { dateString: plus1DateString } = getDate({ dateIncrement: 1 });
+        const bookingStartTime = `${plus1DateString}T04:00:00Z`;
+        const bookingEndTime = `${plus1DateString}T04:30:00Z`;
+
+        await createBookingScenario(
+          getScenarioData({
+            eventTypes: [
+              {
+                id: 1,
+                slug: "collective-team-seated-event",
+                slotInterval: 30,
+                length: 30,
+                schedulingType: SchedulingType.COLLECTIVE,
+                users: [
+                  {
+                    id: 101,
+                  },
+                  {
+                    id: 102,
+                  },
+                ],
+                destinationCalendar: {
+                  integration: TestData.apps["google-calendar"].type,
+                  externalId: "event-type-1@google-calendar.com",
+                },
+                seatsPerTimeSlot: 2,
+                seatsShowAttendees: false,
+              },
+            ],
+            bookings: [
+              {
+                id: bookingId,
+                uid: bookingUid,
+                eventTypeId: 1,
+                status: BookingStatus.ACCEPTED,
+                startTime: bookingStartTime,
+                endTime: bookingEndTime,
+                metadata: {
+                  videoCallUrl: "https://existing-daily-video-call-url.example.com",
+                },
+                references: [
+                  {
+                    type: appStoreMetadata.dailyvideo.type,
+                    uid: "MOCK_ID",
+                    meetingId: "MOCK_ID",
+                    meetingPassword: "MOCK_PASS",
+                    meetingUrl: "http://mock-dailyvideo.example.com",
+                    credentialId: null,
+                  },
+                ],
+                attendees: [
+                  getMockBookingAttendee({
+                    id: 1,
+                    name: "Other Team Member 1",
+                    email: "other-team-member-1@example.com",
+                    locale: "en",
+                    timeZone: "America/Toronto",
+                  }),
+                  getMockBookingAttendee({
+                    id: 2,
+                    name: "Seat 1",
+                    email: "seat1@test.com",
+                    locale: "en",
+                    timeZone: "America/Toronto",
+                    bookingSeat: {
+                      referenceUid: "booking-seat-1",
+                      data: {},
+                    },
+                  }),
+                ],
+              },
+            ],
+            organizer,
+            usersApartFromOrganizer: otherTeamMembers,
+            apps: [TestData.apps["google-calendar"], TestData.apps["daily-video"]],
+          })
+        );
+
+        mockSuccessfulVideoMeetingCreation({
+          metadataLookupKey: "dailyvideo",
+          videoMeetingData: {
+            id: "MOCK_ID",
+            password: "MOCK_PASS",
+            url: `http://mock-dailyvideo.example.com/meeting-1`,
+          },
+        });
+
+        const reqBookingUser = "seatedAttendee";
+
+        const mockBookingData = getMockRequestDataForBooking({
+          data: {
+            eventTypeId: 1,
+            responses: {
+              email: booker.email,
+              name: booker.name,
+              location: { optionValue: "", value: BookingLocations.CalVideo },
+            },
+            bookingUid: bookingUid,
+            user: reqBookingUser,
+          },
+        });
+
+        const { req } = createMockNextJsRequest({
+          method: "POST",
+          body: mockBookingData,
+        });
+
+        await handleNewBooking(req);
+
+        const newAttendee = await prismaMock.attendee.findFirst({
+          where: {
+            email: booker.email,
+            bookingId: bookingId,
+          },
+          include: {
+            bookingSeat: true,
+          },
+        });
+
+        // Check for the existence of the new attendee with booking seat
+        expect(newAttendee?.bookingSeat).toEqual(
+          expect.objectContaining({
+            referenceUid: expect.any(String),
+            data: expect.any(Object),
+            bookingId: bookingId,
+          })
+        );
+
+        // Verify that the booking seat count is now 2 out of 2
+        const bookingSeatCount = await prismaMock.bookingSeat.count({
+          where: {
+            bookingId: bookingId,
+          },
+        });
+
+        expect(bookingSeatCount).toBe(2);
+      });
     });
 
     describe("Rescheduling a booking", () => {