Larian Studios Forums Divinity: Original Sin 2 Divinity - Original Sin 2 - Bugs & Technical Problems NPCs think my weapon is unsheathed

Did you try hitting Tab (default hotkey) to Toggle Combat Mode?

Does it help if you select a skill or grenade, etc (anything that needs a target) and then right click to cancel?
This would fix a rare glitch in D:OS EE that can cause the draw/sheath weapon toggle not to work, though in that case the models would show the character with a drawn weapon.