MOTIVATION: One of the key applications of Unique Molecular Identifiers (UMIs) in high-throughput sequencing is to correct for PCR amplification bias and removal of PCR duplicates, thereby improving quantification in DNA-seq and RNA-seq applications. Accurately grouping error-bearing UMIs that originate from the same input molecule through a UMI deduplication method is a critical step in this process. However, many existing UMI deduplication tools rely on simple Hamming distance comparisons or suboptimal clustering algorithms, often resulting in erroneous UMI groupings, particularly in error-prone long-read sequencing or ultra-high-depth short-read sequencing. RESULTS: We introduce UMI-nea, a tool that utilizes Levenshtein distance comparisons and a novel clustering approach to optimize multithreading workflows. Compared against three other indel-aware UMI deduplication tools, UMI-nea achieves more accurate UMI groupings with efficient run time. It demonstrates robust performance across diverse sequencing platforms, depths, and UMI lengths. Additionally, UMI-nea incorporates a data-guided adaptive UMI filter, further enhancing quantification accuracy. AVAILABILITY AND IMPLEMENTATION: UMI-nea is available on github https://github.com/Qiaseq-research/UMI-nea.git or Zenodo https://doi.org/10.5281/zenodo.16745758. Sequencing data are stored at https://qiagenpublic.blob.core.windows.net/umi-nea-datasets/.