diff --git a/src/services/vectorSearchService.ts b/src/services/vectorSearchService.ts
index 537180e..33318d9 100644
--- a/src/services/vectorSearchService.ts
+++ b/src/services/vectorSearchService.ts
@@ -283,6 +283,12 @@ export const searchToolsByVector = async (
   }>
 > => {
   try {
+    // If serverNames is an empty array (not undefined), return empty results
+    // This happens when using $smart/{group} with an empty or non-existent group
+    if (serverNames !== undefined && serverNames.length === 0) {
+      return [];
+    }
+
     const vectorRepository = getRepositoryFactory(
       'vectorEmbeddings',
     )() as VectorEmbeddingRepository;
diff --git a/tests/services/vectorSearchService.test.ts b/tests/services/vectorSearchService.test.ts
new file mode 100644
index 0000000..58b6ac3
--- /dev/null
+++ b/tests/services/vectorSearchService.test.ts
@@ -0,0 +1,137 @@
+import { describe, it, expect, jest, beforeEach } from '@jest/globals';
+
+// Mock dependencies before importing vectorSearchService
+jest.mock('../../src/db/index.js', () => ({
+  getRepositoryFactory: jest.fn(() => () => ({
+    searchByText: jest.fn(),
+    saveEmbedding: jest.fn(),
+  })),
+}));
+
+jest.mock('../../src/db/connection.js', () => ({
+  getAppDataSource: jest.fn(() => ({
+    isInitialized: true,
+    query: jest.fn(),
+  })),
+  initializeDatabase: jest.fn(),
+}));
+
+jest.mock('../../src/utils/smartRouting.js', () => ({
+  getSmartRoutingConfig: jest.fn(() => ({
+    enabled: true,
+    openaiApiKey: 'test-key',
+    openaiApiBaseUrl: 'https://api.openai.com/v1',
+    openaiApiEmbeddingModel: 'text-embedding-3-small',
+  })),
+}));
+
+jest.mock('openai', () => {
+  return {
+    default: jest.fn().mockImplementation(() => ({
+      apiKey: 'test-key',
+      embeddings: {
+        create: jest.fn().mockResolvedValue({
+          data: [{ embedding: new Array(1536).fill(0.1) }],
+        }),
+      },
+    })),
+  };
+});
+
+// Import after mocks are set up
+import { searchToolsByVector } from '../../src/services/vectorSearchService.js';
+import { getRepositoryFactory } from '../../src/db/index.js';
+
+describe('vectorSearchService', () => {
+  beforeEach(() => {
+    jest.clearAllMocks();
+  });
+
+  describe('searchToolsByVector', () => {
+    it('should return empty array when serverNames is an empty array', async () => {
+      // This test verifies the fix for the $smart/group routing issue
+      // When serverNames is an empty array (empty group), no results should be returned
+      const result = await searchToolsByVector('test query', 10, 0.3, []);
+
+      // searchByText should NOT be called because we return early with empty results
+      const mockRepository = (getRepositoryFactory as jest.Mock)();
+      expect(mockRepository.searchByText).not.toHaveBeenCalled;
+
+      // Result should be empty
+      expect(result).toEqual([]);
+    });
+
+    it('should search all servers when serverNames is undefined', async () => {
+      const mockSearchResults = [
+        {
+          similarity: 0.9,
+          embedding: {
+            text_content: 'test tool description',
+            metadata: JSON.stringify({
+              serverName: 'server1',
+              toolName: 'tool1',
+              description: 'Test tool 1',
+              inputSchema: {},
+            }),
+          },
+        },
+      ];
+
+      const mockRepository = {
+        searchByText: jest.fn().mockResolvedValue(mockSearchResults),
+        saveEmbedding: jest.fn(),
+      };
+
+      (getRepositoryFactory as jest.Mock).mockReturnValue(() => mockRepository);
+
+      const result = await searchToolsByVector('test query', 10, 0.3, undefined);
+
+      // searchByText should be called since serverNames is undefined
+      expect(mockRepository.searchByText).toHaveBeenCalled();
+      expect(result.length).toBeGreaterThan(0);
+      expect(result[0].serverName).toBe('server1');
+    });
+
+    it('should filter results by serverNames when provided', async () => {
+      const mockSearchResults = [
+        {
+          similarity: 0.9,
+          embedding: {
+            text_content: 'test tool 1',
+            metadata: JSON.stringify({
+              serverName: 'server1',
+              toolName: 'tool1',
+              description: 'Test tool 1',
+              inputSchema: {},
+            }),
+          },
+        },
+        {
+          similarity: 0.85,
+          embedding: {
+            text_content: 'test tool 2',
+            metadata: JSON.stringify({
+              serverName: 'server2',
+              toolName: 'tool2',
+              description: 'Test tool 2',
+              inputSchema: {},
+            }),
+          },
+        },
+      ];
+
+      const mockRepository = {
+        searchByText: jest.fn().mockResolvedValue(mockSearchResults),
+        saveEmbedding: jest.fn(),
+      };
+
+      (getRepositoryFactory as jest.Mock).mockReturnValue(() => mockRepository);
+
+      // Filter to only server1
+      const result = await searchToolsByVector('test query', 10, 0.3, ['server1']);
+
+      expect(result.length).toBe(1);
+      expect(result[0].serverName).toBe('server1');
+    });
+  });
+});