diff --git a/Code/Framework/AzCore/AzCore/Utils/Utils.h b/Code/Framework/AzCore/AzCore/Utils/Utils.h
index 4e64ce5a39..d082a3ebe0 100644
--- a/Code/Framework/AzCore/AzCore/Utils/Utils.h
+++ b/Code/Framework/AzCore/AzCore/Utils/Utils.h
@@ -113,7 +113,8 @@ namespace AZ
         //! Save a string to a file. Otherwise returns a failure with error message.
         AZ::Outcome<void, AZStd::string> WriteFile(AZStd::string_view content, AZStd::string_view filePath);
 
-        //! Read a file into a string. Returns a failure with error message if the content could not be loaded.
+        //! Read a file into a string. Returns a failure with error message if the content could not be loaded or if
+        //! the file size is larger than the max file size provided.
         template<typename Container = AZStd::string>
         AZ::Outcome<Container, AZStd::string> ReadFile(AZStd::string_view filePath, size_t maxFileSize = DefaultMaxFileSize);
     }
diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/Entity/PrefabEditorEntityOwnershipService.cpp b/Code/Framework/AzToolsFramework/AzToolsFramework/Entity/PrefabEditorEntityOwnershipService.cpp
index 7fd11ff9bf..fa7d5f6e9b 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/Entity/PrefabEditorEntityOwnershipService.cpp
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/Entity/PrefabEditorEntityOwnershipService.cpp
@@ -185,13 +185,7 @@ namespace AzToolsFramework
     bool PrefabEditorEntityOwnershipService::LoadFromStream(AZ::IO::GenericStream& stream, AZStd::string_view filename)
     {
         Reset();
-        // Make loading from stream to behave the same in terms of filesize as regular loading of prefabs
-        // This may need to be revisited in the future for supporting higher sizes along with prefab loading
-        if (stream.GetLength() > Prefab::MaxPrefabFileSize)
-        {
-            AZ_Error("Prefab", false, "'%.*s' prefab content is bigger than the max supported size (%f MB)", AZ_STRING_ARG(filename), Prefab::MaxPrefabFileSize / (1024.f * 1024.f));
-            return false;
-        }
+
         const size_t bufSize = stream.GetLength();
         AZStd::unique_ptr<char[]> buf(new char[bufSize]);
         AZ::IO::SizeType bytes = stream.Read(bufSize, buf.get());
diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoader.cpp b/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoader.cpp
index d7de634c11..44dff93cb5 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoader.cpp
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoader.cpp
@@ -74,7 +74,7 @@ namespace AzToolsFramework
                 return InvalidTemplateId;
             }
 
-            auto readResult = AZ::Utils::ReadFile(GetFullPath(filePath).Native(), MaxPrefabFileSize);
+            auto readResult = AZ::Utils::ReadFile(GetFullPath(filePath).Native(), AZStd::numeric_limits<size_t>::max());
             if (!readResult.IsSuccess())
             {
                 AZ_Error(
diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoaderInterface.h b/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoaderInterface.h
index 0e551cee6b..a9a1ee0607 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoaderInterface.h
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabLoaderInterface.h
@@ -21,8 +21,6 @@ namespace AzToolsFramework
 {
     namespace Prefab
     {
-        constexpr size_t MaxPrefabFileSize = 1024 * 1024;
-
         /*!
          * PrefabLoaderInterface
          * Interface for saving/loading Prefab files.