Vitest giving TypeError: React.act is not a function with React version 19

I am using React version 19 with Vite and when run Vitest, it's giving error

FAIL  src/components/UserPopover/UserPopover.test.tsx > UserPopover > calls only         
onCancel when "Cancel" button is clicked

TypeError: React.act is not a function
 ❯ exports.act node_modules/react-dom/cjs/react-dom-test-utils.production.js:20:16
 ❯ node_modules/@testing-library/react/dist/act-compat.js:47:25
 ❯ node_modules/@testing-library/react/dist/pure.js:307:28
 ❯ cleanup node_modules/@testing-library/react/dist/pure.js:303:22
 ❯ node_modules/@testing-library/react/dist/index.js:28:25
 26|   if (typeof afterEach === 'function') {
 27|     afterEach(() => {
 28|       (0, _pure.cleanup)();
   |                         ^
 29|     });
 30|   } else if (typeof teardown === 'function') {

package.json - it is not installing dev dependencies, if I use -D or --save-dev

{
  "name": "my-app",
  "private": true,
  "version": "0.0.0",
  "type": "module",
  "scripts": {
    "dev": "vite",
    "build": "tsc -b && vite build",
    "lint": "eslint .",
    "preview": "vite preview",
    "test": "vitest --watch",
    "test:coverage": "vitest run --coverage"
  },
  "dependencies": {
    "@ant-design/icons": "^6.0.0",
    "@testing-library/jest-dom": "^6.6.3",
    "@testing-library/react": "^16.3.0",
    "@testing-library/user-event": "^14.6.1",
    "@types/react": "^19.1.8",
    "@types/react-dom": "^19.1.6",
    "@types/react-test-renderer": "^19.1.0",
    "@vitejs/plugin-react": "^4.6.0",
    "@vitest/coverage-v8": "^3.2.4",
    "ag-grid-react": "^34.0.0",
    "antd": "^5.26.4",
    "happy-dom": "^18.0.1",
    "jsdom": "^26.1.0",
    "react": "^19.1.0",
    "react-dom": "^19.1.0",
    "react-test-renderer": "^18.3.1",
    "vite": "^7.0.0",
    "vitest": "^3.2.4",
    "vitest-browser-react": "^1.0.0"
  },
  "devDependencies": {
    "@eslint/js": "^9.29.0",
    "eslint": "^9.29.0",
    "eslint-plugin-react-hooks": "^5.2.0",
    "eslint-plugin-react-refresh": "^0.4.20",
    "globals": "^16.2.0",
    "less": "^4.3.0",
    "typescript": "~5.8.3",
    "typescript-eslint": "^8.34.1"
  }
}

vite.config.ts

/// <reference types="vitest" />

import { defineConfig } from "vitest/config";
import react from "@vitejs/plugin-react";

export default defineConfig({
  plugins: [react()],
  test: {
    include: [
      "src/**/*.test.ts",
      "src/**/*.test.tsx",
      "src/**/*.test.js",
      "src/**/*.test.jsx",
    ],
    globals: true,
    environment: "happy-dom",
    setupFiles: "./src/setupTests.ts",
    css: true,
    /* browser: {
      enabled: true,
      instances: [{ browser: "chromium" }],
    }, */
  },
});

tsconfig.json

  "compilerOptions": {
    "jsx": "react-jsx",      // For React 17+ (with new JSX transform)
    "module": "ESNext",
    "target": "ESNext",
    "moduleResolution": "Node",
    "strict": true,
    "esModuleInterop": true,
    "skipLibCheck": true,
     "types": ["vitest/globals", "@testing-library/jest-dom"]
  },
  "include": ["src", "src/setupTests.ts"]
}

setupTest.ts

import "@testing-library/jest-dom";

import { render, screen, fireEvent } from "@testing-library/react";
import UserPopover from "./index";
import { describe, it, expect, vi, beforeEach } from "vitest";
import ReactDom from "react-dom/client";

describe("UserPopover", () => {
  const mockLogout = vi.fn();
  const mockCancel = vi.fn();
  const mockThemeToggle = vi.fn();

  beforeEach(() => {
    localStorage.setItem("userName", "Test User");
    mockLogout.mockClear();
    mockCancel.mockClear();
    mockThemeToggle.mockClear();
  });

  const userInfo = {
    email: "[email protected]",
  };

  it("renders user info correctly", () => {
    render(
      <UserPopover
        userInfo={userInfo}
        onLogout={mockLogout}
        onCancel={mockCancel}
        onThemeToggle={mockThemeToggle}
        theme="light"
      />
    );

    expect(screen.getByText("Test User")).toBeInTheDocument();
    expect(screen.getByText(userInfo.email)).toBeInTheDocument();
  });
});

Please suggest how to run unit test