diff --git a/src/lib/menu/menu-directive.ts b/src/lib/menu/menu-directive.ts
index 3863103b3f4..9ff5f9aeb15 100644
--- a/src/lib/menu/menu-directive.ts
+++ b/src/lib/menu/menu-directive.ts
@@ -196,8 +196,8 @@ export class MatMenu implements OnInit, AfterContentInit, MatMenuPanel, OnDestro
   set classList(classes: string) { this.panelClass = classes; }
 
   /** Event emitted when the menu is closed. */
-  @Output() readonly closed: EventEmitter<void | 'click' | 'keydown'> =
-      new EventEmitter<void | 'click' | 'keydown'>();
+  @Output() readonly closed: EventEmitter<void | 'click' | 'keydown' | 'tab'> =
+      new EventEmitter<void | 'click' | 'keydown' | 'tab'>();
 
   /**
    * Event emitted when the menu is closed.
@@ -217,7 +217,7 @@ export class MatMenu implements OnInit, AfterContentInit, MatMenuPanel, OnDestro
 
   ngAfterContentInit() {
     this._keyManager = new FocusKeyManager<MatMenuItem>(this.items).withWrap().withTypeAhead();
-    this._tabSubscription = this._keyManager.tabOut.subscribe(() => this.close.emit('keydown'));
+    this._tabSubscription = this._keyManager.tabOut.subscribe(() => this.close.emit('tab'));
   }
 
   ngOnDestroy() {
diff --git a/src/lib/menu/menu-panel.ts b/src/lib/menu/menu-panel.ts
index 9e140a1d819..344841a81f5 100644
--- a/src/lib/menu/menu-panel.ts
+++ b/src/lib/menu/menu-panel.ts
@@ -21,7 +21,7 @@ export interface MatMenuPanel {
   yPosition: MenuPositionY;
   overlapTrigger: boolean;
   templateRef: TemplateRef<any>;
-  close: EventEmitter<void | 'click' | 'keydown'>;
+  close: EventEmitter<void | 'click' | 'keydown' | 'tab'>;
   parentMenu?: MatMenuPanel | undefined;
   direction?: Direction;
   focusFirstItem: (origin?: FocusOrigin) => void;
diff --git a/src/lib/menu/menu-trigger.ts b/src/lib/menu/menu-trigger.ts
index ea5fc92a6ff..46e42754ddc 100644
--- a/src/lib/menu/menu-trigger.ts
+++ b/src/lib/menu/menu-trigger.ts
@@ -155,7 +155,7 @@ export class MatMenuTrigger implements AfterContentInit, OnDestroy {
       this._destroyMenu();
 
       // If a click closed the menu, we should close the entire chain of nested menus.
-      if (reason === 'click' && this._parentMenu) {
+      if ((reason === 'click' || reason === 'tab') && this._parentMenu) {
         this._parentMenu.closed.emit(reason);
       }
     });
diff --git a/src/lib/menu/menu.spec.ts b/src/lib/menu/menu.spec.ts
index 55676f8d6fd..39209f5fbd5 100644
--- a/src/lib/menu/menu.spec.ts
+++ b/src/lib/menu/menu.spec.ts
@@ -15,7 +15,7 @@ import {
 } from '@angular/core';
 import {Direction, Directionality} from '@angular/cdk/bidi';
 import {OverlayContainer, Overlay} from '@angular/cdk/overlay';
-import {ESCAPE, LEFT_ARROW, RIGHT_ARROW} from '@angular/cdk/keycodes';
+import {ESCAPE, LEFT_ARROW, RIGHT_ARROW, TAB} from '@angular/cdk/keycodes';
 import {
   MAT_MENU_DEFAULT_OPTIONS,
   MatMenu,
@@ -1168,6 +1168,28 @@ describe('MatMenu', () => {
       expect(overlay.querySelectorAll('.mat-menu-panel').length).toBe(0, 'Expected no open menus');
     }));
 
+    it('should close all of the menus when the user tabs away', fakeAsync(() => {
+      compileTestComponent();
+      instance.rootTriggerEl.nativeElement.click();
+      fixture.detectChanges();
+
+      instance.levelOneTrigger.openMenu();
+      fixture.detectChanges();
+
+      instance.levelTwoTrigger.openMenu();
+      fixture.detectChanges();
+
+      const menus = overlay.querySelectorAll('.mat-menu-panel');
+
+      expect(menus.length).toBe(3, 'Expected three open menus');
+
+      dispatchKeyboardEvent(menus[menus.length - 1], 'keydown', TAB);
+      fixture.detectChanges();
+      tick(500);
+
+      expect(overlay.querySelectorAll('.mat-menu-panel').length).toBe(0, 'Expected no open menus');
+    }));
+
     it('should set a class on the menu items that trigger a sub-menu', () => {
       compileTestComponent();
       instance.rootTrigger.openMenu();