JSFiddle - React, Tailwind, and code Playground

HTML

<div class="dungeon-action-select-container">
    <div class="scrollbar_wrap">
        <div class="dungeon-action-select"> <!-- changed overflow to none -->
            <div class="border"><div></div></div>
            <div class="border"><div></div></div>
            <div class="border selected"><div></div></div>
            <div class="border"><div></div></div>
            <div class="border"><div></div></div>
        </div>
    </div>
</div>

CSS

.dungeon-action-select-container {
    position: fixed;
    width: 125px; /* 80px + 2 * 15px + width of scrollbar */
    top: 60px;
    left: 25px;
}

.dungeon-action-select-container .dungeon-action-select {
    height: 320px;
    overflow: none;
    position: relative;
}

.dungeon-action-select-container .dungeon-action-select .border {
    background-color: #333;
    padding: 7px 15px;
}

.dungeon-action-select-container .dungeon-action-select .border div {
    width: 80px;
    height: 80px;
    background-color: black;
}

.scrollbar_wrap {height:200px;overflow:auto;}