diff --git a/homeassistant/components/shelly/climate.py b/homeassistant/components/shelly/climate.py
index b368b38820e..81289bc1a9b 100644
--- a/homeassistant/components/shelly/climate.py
+++ b/homeassistant/components/shelly/climate.py
@@ -132,7 +132,11 @@ def async_setup_rpc_entry(
     climate_ids = []
     for id_ in climate_key_ids:
         climate_ids.append(id_)
-
+        # There are three configuration scenarios for WallDisplay:
+        # - relay mode (no thermostat)
+        # - thermostat mode using the internal relay as an actuator
+        # - thermostat mode using an external (from another device) relay as
+        #   an actuator
         if is_rpc_thermostat_internal_actuator(coordinator.device.status):
             # Wall Display relay is used as the thermostat actuator,
             # we need to remove a switch entity
diff --git a/homeassistant/components/shelly/switch.py b/homeassistant/components/shelly/switch.py
index 14fec43c58b..81b16d48ab8 100644
--- a/homeassistant/components/shelly/switch.py
+++ b/homeassistant/components/shelly/switch.py
@@ -43,6 +43,7 @@ from .utils import (
     is_block_channel_type_light,
     is_rpc_channel_type_light,
     is_rpc_thermostat_internal_actuator,
+    is_rpc_thermostat_mode,
 )
 
 
@@ -140,12 +141,19 @@ def async_setup_rpc_entry(
             continue
 
         if coordinator.model == MODEL_WALL_DISPLAY:
-            if not is_rpc_thermostat_internal_actuator(coordinator.device.status):
-                # Wall Display relay is not used as the thermostat actuator,
-                # we need to remove a climate entity
+            # There are three configuration scenarios for WallDisplay:
+            # - relay mode (no thermostat)
+            # - thermostat mode using the internal relay as an actuator
+            # - thermostat mode using an external (from another device) relay as
+            #   an actuator
+            if not is_rpc_thermostat_mode(id_, coordinator.device.status):
+                # The device is not in thermostat mode, we need to remove a climate
+                # entity
                 unique_id = f"{coordinator.mac}-thermostat:{id_}"
                 async_remove_shelly_entity(hass, "climate", unique_id)
-            else:
+            elif is_rpc_thermostat_internal_actuator(coordinator.device.status):
+                # The internal relay is an actuator, skip this ID so as not to create
+                # a switch entity
                 continue
 
         switch_ids.append(id_)
diff --git a/homeassistant/components/shelly/utils.py b/homeassistant/components/shelly/utils.py
index ce98e0d5c12..b7cb2f1476a 100644
--- a/homeassistant/components/shelly/utils.py
+++ b/homeassistant/components/shelly/utils.py
@@ -500,3 +500,8 @@ def async_remove_shelly_rpc_entities(
         if entity_id := entity_reg.async_get_entity_id(domain, DOMAIN, f"{mac}-{key}"):
             LOGGER.debug("Removing entity: %s", entity_id)
             entity_reg.async_remove(entity_id)
+
+
+def is_rpc_thermostat_mode(ident: int, status: dict[str, Any]) -> bool:
+    """Return True if 'thermostat:<IDent>' is present in the status."""
+    return f"thermostat:{ident}" in status
diff --git a/tests/components/shelly/test_climate.py b/tests/components/shelly/test_climate.py
index 9fee3468f11..9946dd7640d 100644
--- a/tests/components/shelly/test_climate.py
+++ b/tests/components/shelly/test_climate.py
@@ -25,7 +25,12 @@ from homeassistant.components.climate import (
 from homeassistant.components.shelly.const import DOMAIN
 from homeassistant.components.switch import DOMAIN as SWITCH_DOMAIN
 from homeassistant.config_entries import SOURCE_REAUTH, ConfigEntryState
-from homeassistant.const import ATTR_ENTITY_ID, ATTR_TEMPERATURE, STATE_UNAVAILABLE
+from homeassistant.const import (
+    ATTR_ENTITY_ID,
+    ATTR_TEMPERATURE,
+    STATE_ON,
+    STATE_UNAVAILABLE,
+)
 from homeassistant.core import HomeAssistant, State
 from homeassistant.exceptions import HomeAssistantError, ServiceValidationError
 from homeassistant.helpers.device_registry import DeviceRegistry
@@ -711,3 +716,36 @@ async def test_wall_display_thermostat_mode(
     entry = entity_registry.async_get(climate_entity_id)
     assert entry
     assert entry.unique_id == "123456789ABC-thermostat:0"
+
+
+async def test_wall_display_thermostat_mode_external_actuator(
+    hass: HomeAssistant,
+    mock_rpc_device: Mock,
+    entity_registry: EntityRegistry,
+    monkeypatch: pytest.MonkeyPatch,
+) -> None:
+    """Test Wall Display in thermostat mode with an external actuator."""
+    climate_entity_id = "climate.test_name"
+    switch_entity_id = "switch.test_switch_0"
+
+    new_status = deepcopy(mock_rpc_device.status)
+    new_status["sys"]["relay_in_thermostat"] = False
+    monkeypatch.setattr(mock_rpc_device, "status", new_status)
+
+    await init_integration(hass, 2, model=MODEL_WALL_DISPLAY)
+
+    # the switch entity should be created
+    state = hass.states.get(switch_entity_id)
+    assert state
+    assert state.state == STATE_ON
+    assert len(hass.states.async_entity_ids(SWITCH_DOMAIN)) == 1
+
+    # the climate entity should be created
+    state = hass.states.get(climate_entity_id)
+    assert state
+    assert state.state == HVACMode.HEAT
+    assert len(hass.states.async_entity_ids(CLIMATE_DOMAIN)) == 1
+
+    entry = entity_registry.async_get(climate_entity_id)
+    assert entry
+    assert entry.unique_id == "123456789ABC-thermostat:0"
diff --git a/tests/components/shelly/test_switch.py b/tests/components/shelly/test_switch.py
index fe2c4354afc..dd214c8841d 100644
--- a/tests/components/shelly/test_switch.py
+++ b/tests/components/shelly/test_switch.py
@@ -330,6 +330,7 @@ async def test_wall_display_relay_mode(
 
     new_status = deepcopy(mock_rpc_device.status)
     new_status["sys"]["relay_in_thermostat"] = False
+    new_status.pop("thermostat:0")
     monkeypatch.setattr(mock_rpc_device, "status", new_status)
 
     await init_integration(hass, 2, model=MODEL_WALL_DISPLAY)