diff --git a/web_app/tests/test_vault.py b/web_app/tests/test_vault.py
new file mode 100644
index 00000000..7423426a
--- /dev/null
+++ b/web_app/tests/test_vault.py
@@ -0,0 +1,173 @@
+"""
+test_vault.py
+This module contains unit tests for the vault functionality within the web_app.
+It verifies deposit operations, balance retrieval, and balance updates.
+"""
+
+import pytest
+from fastapi import HTTPException
+from fastapi.testclient import TestClient
+from httpx import AsyncClient
+from unittest.mock import patch, MagicMock
+import uuid
+
+from web_app.api.main import app
+from web_app.db.crud import DepositDBConnector, UserDBConnector
+
+client = TestClient(app)
+
+
+@pytest.fixture
+async def async_client():
+    """Fixture that provides an async client for testing."""
+    async with AsyncClient(app=app, base_url="http://test") as ac:
+        yield ac
+
+
+@pytest.mark.anyio
+@pytest.mark.parametrize("test_data, expected_status, expected_response", [
+    (
+        {"wallet_id": "test_wallet", "symbol": "ETH", "amount": "1.0"},
+        200,
+        lambda vault_id: {
+            "deposit_id": vault_id,
+            "wallet_id": "test_wallet",
+            "amount": "1.0",
+            "symbol": "ETH"
+        }
+    ),
+    (
+        {"wallet_id": "invalid_wallet", "symbol": "ETH", "amount": "1.0"},
+        404,
+        {"detail": "User not found"}
+    ),
+])
+async def test_deposit_to_vault(
+    test_data, 
+    expected_status, 
+    expected_response, 
+    mock_user_db_connector, 
+    async_client
+):
+    """Test vault deposit with different scenarios."""
+    mock_user = MagicMock()
+    mock_vault = MagicMock()
+    mock_vault.id = str(uuid.uuid4())
+    mock_vault.amount = test_data["amount"]
+    
+    with patch.object(UserDBConnector, "__new__", return_value=mock_user_db_connector):
+        mock_user_db_connector.get_user_by_wallet_id.return_value = (
+            mock_user if test_data["wallet_id"] == "test_wallet" else None
+        )
+        
+        if test_data["wallet_id"] == "test_wallet":
+            with patch(
+                "web_app.db.crud.DepositDBConnector.create_vault", 
+                return_value=mock_vault
+            ):
+                response = await async_client.post("/api/vault/deposit", json=test_data)
+        else:
+            response = await async_client.post("/api/vault/deposit", json=test_data)
+    
+    assert response.status_code == expected_status
+    expected = (
+        expected_response(mock_vault.id) 
+        if callable(expected_response) 
+        else expected_response
+    )
+    assert response.json() == expected
+
+
+@pytest.mark.anyio
+@pytest.mark.parametrize(
+    "wallet_id, symbol, balance, expected_status, expected_response",
+    [
+        (
+            "test_wallet",
+            "ETH",
+            "1.5",
+            200,
+            lambda w, s, b: {"wallet_id": w, "symbol": s, "amount": b}
+        ),
+        (
+            "invalid_wallet",
+            "ETH",
+            None,
+            404,
+            {"detail": "Vault not found or user does not exist"}
+        ),
+    ]
+)
+async def test_get_vault_balance(
+    wallet_id, 
+    symbol, 
+    balance, 
+    expected_status, 
+    expected_response, 
+    async_client
+):
+    """Test vault balance retrieval with different scenarios."""
+    with patch(
+        "web_app.db.crud.DepositDBConnector.get_vault_balance", 
+        return_value=balance
+    ):
+        url = f"/api/vault/api/balance?wallet_id={wallet_id}&symbol={symbol}"
+        response = await async_client.get(url)
+        
+        assert response.status_code == expected_status
+        expected = (
+            expected_response(wallet_id, symbol, balance) 
+            if callable(expected_response) 
+            else expected_response
+        )
+        assert response.json() == expected
+
+
+@pytest.mark.anyio
+@pytest.mark.parametrize("test_data, expected_status, expected_response", [
+    (
+        {"wallet_id": "test_wallet", "symbol": "ETH", "amount": "0.5"},
+        200,
+        lambda amount: {"wallet_id": "test_wallet", "symbol": "ETH", "amount": amount}
+    ),
+    (
+        {"wallet_id": "test_wallet", "symbol": "ETH", "amount": "-1.0"},
+        400,
+        {"detail": "Failed to update vault balance: Amount must be positive"}
+    ),
+])
+async def test_add_vault_balance(
+    test_data, 
+    expected_status, 
+    expected_response, 
+    async_client
+):
+    """Test adding to vault balance with different scenarios."""
+    mock_vault = MagicMock()
+    mock_vault.amount = "2.0"
+    
+    if test_data["amount"].startswith("-"):
+        patch_kwargs = {
+            "side_effect": ValueError("Amount must be positive")
+        }
+    else:
+        patch_kwargs = {
+            "return_value": mock_vault
+        }
+    
+    with patch(
+        "web_app.db.crud.DepositDBConnector.add_vault_balance", 
+        **patch_kwargs
+    ):
+        response = await async_client.post(
+            "/api/vault/api/add_balance", 
+            json=test_data
+        )
+        
+        assert response.status_code == expected_status
+        expected = (
+            expected_response(mock_vault.amount) 
+            if callable(expected_response) 
+            else expected_response
+        )
+        assert response.json() == expected