diff --git a/packages/flutter/lib/src/material/segmented_button.dart b/packages/flutter/lib/src/material/segmented_button.dart
index 9bf7ec23fd7..aa231afd1cf 100644
--- a/packages/flutter/lib/src/material/segmented_button.dart
+++ b/packages/flutter/lib/src/material/segmented_button.dart
@@ -11,6 +11,7 @@ library;
 
 import 'dart:math' as math;
 import 'dart:math';
+import 'dart:ui' show lerpDouble;
 
 import 'package:flutter/foundation.dart';
 import 'package:flutter/rendering.dart';
@@ -570,44 +571,59 @@ class SegmentedButtonState<T> extends State<SegmentedButton<T>> {
       );
       controller.update(WidgetState.selected, segmentSelected);
 
-      final Widget button = icon != null
-          ? TextButton.icon(
-              style: segmentStyle,
-              statesController: controller,
-              onHover: (bool hovering) {
-                setState(() {
-                  _hovering = hovering;
-                });
-              },
-              onFocusChange: (bool focused) {
-                setState(() {
-                  _focused = focused;
-                });
-              },
-              onPressed: (_enabled && segment.enabled)
-                  ? () => _handleOnPressed(segment.value)
-                  : null,
-              icon: icon,
-              label: label,
-            )
-          : TextButton(
-              style: segmentStyle,
-              statesController: controller,
-              onHover: (bool hovering) {
-                setState(() {
-                  _hovering = hovering;
-                });
-              },
-              onFocusChange: (bool focused) {
-                setState(() {
-                  _focused = focused;
-                });
-              },
-              onPressed: (_enabled && segment.enabled)
-                  ? () => _handleOnPressed(segment.value)
-                  : null,
-              child: label,
-            );
+      Widget content = label;
+      ButtonStyle effectiveSegmentStyle = segmentStyle;
+      if (icon != null) {
+        // This logic is needed to get the exact same rendering as using TextButton.icon.
+        // It is duplicated from _TextButtonWithIcon and _TextButtonWithIconChild.
+        // TODO(bleroux): remove once https://github.com/flutter/flutter/issues/173944 is fixed.
+        final bool useMaterial3 = Theme.of(context).useMaterial3;
+        final double defaultFontSize =
+            segmentStyle.textStyle?.resolve(const <MaterialState>{})?.fontSize ?? 14.0;
+        final double effectiveTextScale =
+            MediaQuery.textScalerOf(context).scale(defaultFontSize) / 14.0;
+        final EdgeInsetsGeometry scaledPadding = ButtonStyleButton.scaledPadding(
+          useMaterial3
+              ? const EdgeInsetsDirectional.fromSTEB(12, 8, 16, 8)
+              : const EdgeInsets.all(8),
+          const EdgeInsets.symmetric(horizontal: 4),
+          const EdgeInsets.symmetric(horizontal: 4),
+          effectiveTextScale,
+        );
+        effectiveSegmentStyle = segmentStyle.copyWith(
+          padding: MaterialStatePropertyAll<EdgeInsetsGeometry>(scaledPadding),
+        );
+        final double scale = clampDouble(effectiveTextScale, 1.0, 2.0) - 1.0;
+        final TextButtonThemeData textButtonTheme = TextButtonTheme.of(context);
+        final IconAlignment effectiveIconAlignment =
+            textButtonTheme.style?.iconAlignment ??
+            segmentStyle.iconAlignment ??
+            IconAlignment.start;
+        content = Row(
+          mainAxisSize: MainAxisSize.min,
+          spacing: lerpDouble(8, 4, scale)!,
+          children: effectiveIconAlignment == IconAlignment.start
+              ? <Widget>[icon, Flexible(child: label)]
+              : <Widget>[Flexible(child: label), icon],
+        );
+      }
+
+      final Widget button = TextButton(
+        style: effectiveSegmentStyle,
+        statesController: controller,
+        onHover: (bool hovering) {
+          setState(() {
+            _hovering = hovering;
+          });
+        },
+        onFocusChange: (bool focused) {
+          setState(() {
+            _focused = focused;
+          });
+        },
+        onPressed: (_enabled && segment.enabled) ? () => _handleOnPressed(segment.value) : null,
+        child: content,
+      );
 
       final Widget buttonWithTooltip = segment.tooltip != null
           ? Tooltip(message: segment.tooltip, child: button)
diff --git a/packages/flutter/test/material/segmented_button_test.dart b/packages/flutter/test/material/segmented_button_test.dart
index a540ec71fae..ec39eaa0c24 100644
--- a/packages/flutter/test/material/segmented_button_test.dart
+++ b/packages/flutter/test/material/segmented_button_test.dart
@@ -243,6 +243,57 @@ void main() {
     expect(selection, <int>{2, 3});
   });
 
+  // Regression test for https://github.com/flutter/flutter/issues/161922.
+  testWidgets('Focused segment does not lose focus when its selection state changes', (
+    WidgetTester tester,
+  ) async {
+    int callbackCount = 0;
+    Set<int> selection = <int>{1};
+
+    Widget frameWithSelection(Set<int> selected) {
+      return Material(
+        child: boilerplate(
+          child: SegmentedButton<int>(
+            multiSelectionEnabled: true,
+            segments: const <ButtonSegment<int>>[
+              ButtonSegment<int>(value: 1, label: Text('1')),
+              ButtonSegment<int>(value: 2, label: Text('2')),
+            ],
+            selected: selected,
+            onSelectionChanged: (Set<int> selected) {
+              selection = selected;
+              callbackCount += 1;
+            },
+          ),
+        ),
+      );
+    }
+
+    await tester.pumpWidget(frameWithSelection(selection));
+    expect(selection, <int>{1});
+    expect(callbackCount, 0);
+
+    // Select segment 2.
+    await tester.pumpWidget(frameWithSelection(<int>{1, 2}));
+    await tester.pumpAndSettle();
+
+    FocusNode getSegment2FocusNode() {
+      return Focus.of(tester.element(find.text('2')));
+    }
+
+    // Set focus on segment 2.
+    getSegment2FocusNode().requestFocus();
+    await tester.pumpAndSettle();
+    expect(getSegment2FocusNode().hasFocus, true);
+
+    // Unselect segment 2.
+    await tester.pumpWidget(frameWithSelection(<int>{1}));
+    await tester.pumpAndSettle();
+
+    // The button should still be focused.
+    expect(getSegment2FocusNode().hasFocus, true);
+  });
+
   testWidgets('SegmentedButton allows for empty selection', (WidgetTester tester) async {
     int callbackCount = 0;
     int? selectedSegment = 1;
@@ -585,7 +636,7 @@ void main() {
     );
 
     final Material material = tester.widget<Material>(
-      find.descendant(of: find.byType(TextButton), matching: find.byType(Material)),
+      find.descendant(of: find.byType(TextButton).last, matching: find.byType(Material)),
     );
 
     // Hovered.