diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.cpp b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.cpp
index 6399a64635..94795c44a9 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.cpp
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.cpp
@@ -115,6 +115,33 @@ namespace AzToolsFramework
         }
     }
 
+    CursorEntityIdQuery::CursorEntityIdQuery(AZ::EntityId entityId, AZ::EntityId rootEntityId)
+        : m_entityId(entityId)
+        , m_containerAncestorEntityId(rootEntityId)
+    {
+    }
+
+    AZ::EntityId CursorEntityIdQuery::EntityIdUnderCursor() const
+    {
+        return m_entityId;
+    }
+
+    AZ::EntityId CursorEntityIdQuery::ContainerAncestorEntityId() const
+    {
+        return m_containerAncestorEntityId;
+    }
+
+    bool CursorEntityIdQuery::HasContainerAncestorEntityId() const
+    {
+        if (m_entityId.IsValid())
+        {
+            return m_entityId != m_containerAncestorEntityId;
+        }
+
+        return false;
+    }
+
+
     EditorHelpers::EditorHelpers(const EditorVisibleEntityDataCache* entityDataCache)
         : m_entityDataCache(entityDataCache)
     {
@@ -131,7 +158,7 @@ namespace AzToolsFramework
         m_invalidClicks = AZStd::make_unique<InvalidClicks>(AZStd::move(invalidClicks));
     }
 
-    AZ::EntityId EditorHelpers::HandleMouseInteraction(
+    CursorEntityIdQuery EditorHelpers::FindEntityIdUnderCursor(
         const AzFramework::CameraState& cameraState, const ViewportInteraction::MouseInteractionEvent& mouseInteraction)
     {
         AZ_PROFILE_FUNCTION(AzToolsFramework);
@@ -202,17 +229,18 @@ namespace AzToolsFramework
                 m_invalidClicks->AddInvalidClick(mouseInteraction.m_mouseInteraction.m_mousePick.m_screenCoordinates);
             }
 
-            return AZ::EntityId();
+            return CursorEntityIdQuery(AZ::EntityId(), AZ::EntityId());
         }
 
         // container entity support - if the entity that is being selected is part of a closed container,
         // change the selection to the container instead.
         if (ContainerEntityInterface* containerEntityInterface = AZ::Interface<ContainerEntityInterface>::Get())
         {
-            return containerEntityInterface->FindHighestSelectableEntity(entityIdUnderCursor);
+            const auto highestSelectableEntity = containerEntityInterface->FindHighestSelectableEntity(entityIdUnderCursor);
+            return CursorEntityIdQuery(entityIdUnderCursor, highestSelectableEntity);
         }
 
-        return entityIdUnderCursor;
+        return CursorEntityIdQuery(entityIdUnderCursor, AZ::EntityId());
     }
 
     void EditorHelpers::Display2d(
diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.h b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.h
index 6623221bdc..458f15c1f2 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.h
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorHelpers.h
@@ -32,6 +32,28 @@ namespace AzToolsFramework
         struct MouseInteractionEvent;
     }
 
+    //!< Represents the result of a query to find the id of the entity under the cursor (if any).
+    class CursorEntityIdQuery
+    {
+    public:
+        CursorEntityIdQuery(AZ::EntityId entityId, AZ::EntityId rootEntityId);
+
+        //! Returns the entity id under the cursor (if any).
+        //! @note In the case of no entity id under the cursor, an invalid entity id is returned.
+        AZ::EntityId EntityIdUnderCursor() const;
+
+        //! Returns the topmost container entity id in the hierarchy if the entity id under the cursor is inside a container entity, otherwise returns the entity id.
+        //! @note In the case of no entity id under the cursor, an invalid entity id is returned.
+        AZ::EntityId ContainerAncestorEntityId() const;
+
+        //! Returns true if the query has a container ancestor entity id, otherwise false.
+        bool HasContainerAncestorEntityId() const;
+
+    private:
+        AZ::EntityId m_entityId; //<! The entity id under the cursor.
+        AZ::EntityId m_containerAncestorEntityId; //<! For entities in container entities, the topmost container entity id in the hierarchy, otherwise the entity id under the cursor.
+    };
+
     //! EditorHelpers are the visualizations that appear for entities
     //! when 'Display Helpers' is toggled on inside the editor.
     //! These include but are not limited to entity icons and shape visualizations.
@@ -47,9 +69,9 @@ namespace AzToolsFramework
         EditorHelpers& operator=(const EditorHelpers&) = delete;
         ~EditorHelpers() = default;
 
-        //! Handle any mouse interaction with the EditorHelpers.
+        //! Finds the id of the entity under the cursor (if any). For entities in container entities, also finds the topmost container entity id in the hierarchy.
         //! Used to check if a particular entity was selected.
-        AZ::EntityId HandleMouseInteraction(
+        CursorEntityIdQuery FindEntityIdUnderCursor(
             const AzFramework::CameraState& cameraState, const ViewportInteraction::MouseInteractionEvent& mouseInteraction);
 
         //! Do the drawing responsible for the EditorHelpers.
diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorPickEntitySelection.cpp b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorPickEntitySelection.cpp
index 6e7777b31c..059b265f51 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorPickEntitySelection.cpp
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorPickEntitySelection.cpp
@@ -80,7 +80,7 @@ namespace AzToolsFramework
 
         const AzFramework::CameraState cameraState = GetCameraState(viewportId);
 
-        m_cachedEntityIdUnderCursor = m_editorHelpers->HandleMouseInteraction(cameraState, mouseInteraction);
+        m_cachedEntityIdUnderCursor = m_editorHelpers->FindEntityIdUnderCursor(cameraState, mouseInteraction).ContainerAncestorEntityId();
 
         // when left clicking, if we successfully clicked an entity, assign that
         // to the entity field selected in the entity inspector (RPE)
diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorTransformComponentSelection.cpp b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorTransformComponentSelection.cpp
index c73742da4d..39c882b766 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorTransformComponentSelection.cpp
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/ViewportSelection/EditorTransformComponentSelection.cpp
@@ -27,6 +27,7 @@
 #include <AzToolsFramework/Manipulators/ScaleManipulators.h>
 #include <AzToolsFramework/Manipulators/TranslationManipulators.h>
 #include <AzToolsFramework/Maths/TransformUtils.h>
+#include <AzToolsFramework/Prefab/PrefabFocusInterface.h>
 #include <AzToolsFramework/ToolsComponents/EditorLockComponentBus.h>
 #include <AzToolsFramework/ToolsComponents/EditorVisibilityBus.h>
 #include <AzToolsFramework/ToolsComponents/TransformComponent.h>
@@ -1799,7 +1800,8 @@ namespace AzToolsFramework
         const AzFramework::ViewportId viewportId = mouseInteraction.m_mouseInteraction.m_interactionId.m_viewportId;
         const AzFramework::CameraState cameraState = GetCameraState(viewportId);
 
-        m_cachedEntityIdUnderCursor = m_editorHelpers->HandleMouseInteraction(cameraState, mouseInteraction);
+        const auto cursorEntityIdQuery = m_editorHelpers->FindEntityIdUnderCursor(cameraState, mouseInteraction);
+        m_cachedEntityIdUnderCursor = cursorEntityIdQuery.ContainerAncestorEntityId();
 
         const auto selectClickEvent = ClickDetectorEventFromViewportInteraction(mouseInteraction);
         m_cursorState.SetCurrentPosition(mouseInteraction.m_mouseInteraction.m_mousePick.m_screenCoordinates);
@@ -1825,8 +1827,6 @@ namespace AzToolsFramework
             }
         }
 
-        const AZ::EntityId entityIdUnderCursor = m_cachedEntityIdUnderCursor;
-
         EditorContextMenuUpdate(m_contextMenu, mouseInteraction);
 
         m_boxSelect.HandleMouseInteraction(mouseInteraction);
@@ -1842,6 +1842,21 @@ namespace AzToolsFramework
             return true;
         }
 
+        const AZ::EntityId entityIdUnderCursor = m_cachedEntityIdUnderCursor;
+
+        if (mouseInteraction.m_mouseEvent == ViewportInteraction::MouseEvent::DoubleClick &&
+            mouseInteraction.m_mouseInteraction.m_mouseButtons.Left())
+        {
+            if (cursorEntityIdQuery.HasContainerAncestorEntityId())
+            {
+                if (auto prefabFocusInterface = AZ::Interface<Prefab::PrefabFocusInterface>::Get())
+                {
+                    prefabFocusInterface->FocusOnPrefabInstanceOwningEntityId(cursorEntityIdQuery.ContainerAncestorEntityId());
+                    return false;
+                }
+            }
+        }
+
         bool stickySelect = false;
         ViewportInteraction::ViewportSettingsRequestBus::EventResult(
             stickySelect, viewportId, &ViewportInteraction::ViewportSettingsRequestBus::Events::StickySelectEnabled);