diff --git a/package-lock.json b/package-lock.json
index 919ed175033..95f69ce683b 100644
--- a/package-lock.json
+++ b/package-lock.json
@@ -4730,6 +4730,7 @@
       "cpu": [
         "arm64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4750,6 +4751,7 @@
       "cpu": [
         "arm64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4770,6 +4772,7 @@
       "cpu": [
         "x64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4790,6 +4793,7 @@
       "cpu": [
         "x64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4810,6 +4814,7 @@
       "cpu": [
         "arm"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4830,6 +4835,7 @@
       "cpu": [
         "arm"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4850,6 +4856,7 @@
       "cpu": [
         "arm64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4870,6 +4877,7 @@
       "cpu": [
         "arm64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4890,6 +4898,7 @@
       "cpu": [
         "x64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4910,6 +4919,7 @@
       "cpu": [
         "x64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4930,6 +4940,7 @@
       "cpu": [
         "arm64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4950,6 +4961,7 @@
       "cpu": [
         "ia32"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -4970,6 +4982,7 @@
       "cpu": [
         "x64"
       ],
+      "dev": true,
       "license": "MIT",
       "optional": true,
       "os": [
@@ -22372,8 +22385,10 @@
       "version": "3.6.0",
       "resolved": "https://registry.npmjs.org/chokidar/-/chokidar-3.6.0.tgz",
       "integrity": "sha512-7VT13fmjotKpGipCW9JEQAusEPE+Ei8nl6/g4FBAmIm0GOOLMua9NDDo/DWp0ZAxCr3cPq5ZpBqmPAQgDda2Pw==",
-      "extraneous": true,
+      "dev": true,
       "license": "MIT",
+      "optional": true,
+      "peer": true,
       "dependencies": {
         "anymatch": "~3.1.2",
         "braces": "~3.0.2",
@@ -22425,8 +22440,10 @@
       "version": "5.1.2",
       "resolved": "https://registry.npmjs.org/glob-parent/-/glob-parent-5.1.2.tgz",
       "integrity": "sha512-AOIgSQCepiJYwP3ARnGx+5VnTu2HBYdzbGP45eLw1vr3zB3vZLeyed1sC9hnbcOc9/SrMyM5RPQrkGz4aS9Zow==",
-      "extraneous": true,
+      "dev": true,
       "license": "ISC",
+      "optional": true,
+      "peer": true,
       "dependencies": {
         "is-glob": "^4.0.1"
       },
@@ -22474,8 +22491,10 @@
       "version": "2.3.2",
       "resolved": "https://registry.npmjs.org/picomatch/-/picomatch-2.3.2.tgz",
       "integrity": "sha512-V7+vQEJ06Z+c5tSye8S+nHUfI51xoXIXjHQ99cQtKUkQqqO1kO/KCJUfZXuB47h/YBlDhah2H3hdUGXn8ie0oA==",
-      "extraneous": true,
+      "dev": true,
       "license": "MIT",
+      "optional": true,
+      "peer": true,
       "engines": {
         "node": ">=8.6"
       },
@@ -22487,8 +22506,10 @@
       "version": "3.6.0",
       "resolved": "https://registry.npmjs.org/readdirp/-/readdirp-3.6.0.tgz",
       "integrity": "sha512-hOS089on8RduqdbhvQ5Z37A0ESjsqz6qnRcffsMU3495FuTdqSm+7bhJ29JvIOsBDEEnan5DPu9t3To9VRlMzA==",
-      "extraneous": true,
+      "dev": true,
       "license": "MIT",
+      "optional": true,
+      "peer": true,
       "dependencies": {
         "picomatch": "^2.2.1"
       },
diff --git a/projects/igniteui-angular/grids/grid/src/grid-base.directive.ts b/projects/igniteui-angular/grids/grid/src/grid-base.directive.ts
index e83e4f0e266..ff247a723ba 100644
--- a/projects/igniteui-angular/grids/grid/src/grid-base.directive.ts
+++ b/projects/igniteui-angular/grids/grid/src/grid-base.directive.ts
@@ -7257,20 +7257,24 @@ export abstract class IgxGridBaseDirective implements GridType,
         if (!this._height) {
             return null;
         }
+        const styles = this.document.defaultView.getComputedStyle(this.nativeElement);
         const actualTheadRow = this.getTheadRowHeight();
         const footerHeight = this.getFooterHeight();
         const toolbarHeight = this.getToolbarHeight();
         const pagingHeight = this.getPagingFooterHeight();
         const groupAreaHeight = this.getGroupAreaHeight();
         const scrHeight = this.getComputedHeight(this.scr.nativeElement);
+        const borderTop = parseFloat(styles.getPropertyValue('border-top-width')) || 0;
+        const borderBottom = parseFloat(styles.getPropertyValue('border-bottom-width')) || 0;
+
         const renderedHeight = toolbarHeight + actualTheadRow +
             footerHeight + pagingHeight + groupAreaHeight +
-            scrHeight;
+            scrHeight + borderTop + borderBottom;
 
         let gridHeight = 0;
 
         if (this.isPercentHeight) {
-            const computed = this.document.defaultView.getComputedStyle(this.nativeElement).getPropertyValue('height');
+            const computed = styles.getPropertyValue('height');
             const autoSize = this._shouldAutoSize(renderedHeight);
             if (autoSize || computed.indexOf('%') !== -1) {
                 const bodyHeight = this.getDataBasedBodyHeight();
diff --git a/projects/igniteui-angular/grids/grid/src/grid.component.spec.ts b/projects/igniteui-angular/grids/grid/src/grid.component.spec.ts
index 3dbf7acad9b..2ccd8f07ee0 100644
--- a/projects/igniteui-angular/grids/grid/src/grid.component.spec.ts
+++ b/projects/igniteui-angular/grids/grid/src/grid.component.spec.ts
@@ -1307,6 +1307,30 @@ describe('IgxGrid Component Tests #grid', () => {
             expect(parseInt(window.getComputedStyle(domGrid).height, 10)).toBe(300);
         }));
 
+        it('should account for CSS border widths in body height calculation when height is percent #16640', fakeAsync(() => {
+            const fix = TestBed.createComponent(IgxGridWrappedInContComponent);
+            fix.componentInstance.outerHeight = 600;
+            fix.componentInstance.data = fix.componentInstance.fullData;
+            tick();
+            fix.detectChanges();
+
+            const grid = fix.componentInstance.grid;
+            const calcHeightNoBorder = grid.calcHeight;
+            expect(calcHeightNoBorder).not.toBeNull();
+
+            // Apply a 2px border (top and bottom) to the grid's native element
+            grid.nativeElement.style.borderTop = '2px solid black';
+            grid.nativeElement.style.borderBottom = '2px solid black';
+
+            // Trigger height recalculation
+            grid.reflow();
+            fix.detectChanges();
+
+            // The fix ensures border widths are included in the rendered height calculation,
+            // reducing the available body height accordingly and preventing continuous reflow growth
+            expect(grid.calcHeight).toBe(calcHeightNoBorder - 4);
+        }));
+
         it('should keep auto-sizing if initial data is empty then set to a new array', fakeAsync(() => {
             const fix = TestBed.createComponent(IgxGridWrappedInContComponent);
             tick();
diff --git a/src/app/grid-auto-size/grid-auto-size.sample.scss b/src/app/grid-auto-size/grid-auto-size.sample.scss
index 5e9b37fd2f3..381adfb8f86 100644
--- a/src/app/grid-auto-size/grid-auto-size.sample.scss
+++ b/src/app/grid-auto-size/grid-auto-size.sample.scss
@@ -11,3 +11,7 @@
     margin-bottom: 16px;
     max-width: 900px;
 }
+
+igx-grid {
+    border: 1px solid lightgray;
+}