diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/Thumbnails/ThumbnailerBus.h b/Code/Framework/AzToolsFramework/AzToolsFramework/Thumbnails/ThumbnailerBus.h
index 6f074da878..acd8ba3966 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/Thumbnails/ThumbnailerBus.h
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/Thumbnails/ThumbnailerBus.h
@@ -90,7 +90,7 @@ namespace AzToolsFramework
             typedef SharedThumbnailKey BusIdType;
 
             //! notify product thumbnail that the data is ready
-            virtual void ThumbnailRendered(QPixmap& thumbnailImage) = 0;
+            virtual void ThumbnailRendered(const QPixmap& thumbnailImage) = 0;
             //! notify product thumbnail that the thumbnail failed to render
             virtual void ThumbnailFailedToRender() = 0;
         };
diff --git a/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.cpp b/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.cpp
index 084e38a2db..cdd63dca18 100644
--- a/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.cpp
+++ b/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.cpp
@@ -67,7 +67,7 @@ namespace ImageProcessingAtom
             m_renderWait.acquire();
         }
 
-        void ImageThumbnail::ThumbnailRendered(QPixmap& thumbnailImage)
+        void ImageThumbnail::ThumbnailRendered(const QPixmap& thumbnailImage)
         {
             m_pixmap = thumbnailImage;
             m_renderWait.release();
diff --git a/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.h b/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.h
index 45fd178285..eadbfca945 100644
--- a/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.h
+++ b/Gems/Atom/Asset/ImageProcessingAtom/Code/Source/Thumbnail/ImageThumbnail.h
@@ -34,7 +34,7 @@ namespace ImageProcessingAtom
             ~ImageThumbnail() override;
 
             //! AzToolsFramework::ThumbnailerRendererNotificationBus::Handler overrides...
-            void ThumbnailRendered(QPixmap& thumbnailImage) override;
+            void ThumbnailRendered(const QPixmap& thumbnailImage) override;
             void ThumbnailFailedToRender() override;
 
         protected:
diff --git a/Gems/Atom/Tools/AtomToolsFramework/Code/Include/AtomToolsFramework/PreviewRenderer/PreviewRenderer.h b/Gems/Atom/Tools/AtomToolsFramework/Code/Include/AtomToolsFramework/PreviewRenderer/PreviewRenderer.h
index b772bfcaf2..acedc77751 100644
--- a/Gems/Atom/Tools/AtomToolsFramework/Code/Include/AtomToolsFramework/PreviewRenderer/PreviewRenderer.h
+++ b/Gems/Atom/Tools/AtomToolsFramework/Code/Include/AtomToolsFramework/PreviewRenderer/PreviewRenderer.h
@@ -20,7 +20,7 @@ namespace AzFramework
     class Scene;
 }
 
-class QImage;
+class QPixmap;
 
 namespace AtomToolsFramework
 {
@@ -30,7 +30,7 @@ namespace AtomToolsFramework
     public:
         AZ_CLASS_ALLOCATOR(PreviewRenderer, AZ::SystemAllocator, 0);
 
-        PreviewRenderer();
+        PreviewRenderer(const AZStd::string& sceneName, const AZStd::string& pipelineName);
         ~PreviewRenderer();
 
         struct CaptureRequest final
@@ -38,15 +38,15 @@ namespace AtomToolsFramework
             int m_size = 512;
             AZStd::shared_ptr<PreviewContent> m_content;
             AZStd::function<void()> m_captureFailedCallback;
-            AZStd::function<void(const QImage&)> m_captureCompleteCallback;
+            AZStd::function<void(const QPixmap&)> m_captureCompleteCallback;
         };
 
+        void AddCaptureRequest(const CaptureRequest& captureRequest);
+
         AZ::RPI::ScenePtr GetScene() const;
         AZ::RPI::ViewPtr GetView() const;
         AZ::Uuid GetEntityContextId() const;
 
-        void AddCaptureRequest(const CaptureRequest& captureRequest);
-
         enum class State : AZ::s8
         {
             None,
@@ -81,8 +81,6 @@ namespace AtomToolsFramework
         static constexpr float FieldOfView = AZ::Constants::HalfPi;
 
         AZ::RPI::ScenePtr m_scene;
-        AZStd::string m_sceneName = "Preview Renderer Scene";
-        AZStd::string m_pipelineName = "Preview Renderer Pipeline";
         AZStd::shared_ptr<AzFramework::Scene> m_frameworkScene;
         AZ::RPI::RenderPipelinePtr m_renderPipeline;
         AZ::RPI::ViewPtr m_view;
diff --git a/Gems/Atom/Tools/AtomToolsFramework/Code/Source/PreviewRenderer/PreviewRenderer.cpp b/Gems/Atom/Tools/AtomToolsFramework/Code/Source/PreviewRenderer/PreviewRenderer.cpp
index dfefd0203e..06969abee4 100644
--- a/Gems/Atom/Tools/AtomToolsFramework/Code/Source/PreviewRenderer/PreviewRenderer.cpp
+++ b/Gems/Atom/Tools/AtomToolsFramework/Code/Source/PreviewRenderer/PreviewRenderer.cpp
@@ -24,9 +24,12 @@
 #include <PreviewRenderer/PreviewRendererIdleState.h>
 #include <PreviewRenderer/PreviewRendererLoadState.h>
 
+#include <QImage>
+#include <QPixmap>
+
 namespace AtomToolsFramework
 {
-    PreviewRenderer::PreviewRenderer()
+    PreviewRenderer::PreviewRenderer(const AZStd::string& sceneName, const AZStd::string& pipelineName)
     {
         PreviewerFeatureProcessorProviderBus::Handler::BusConnect();
 
@@ -46,7 +49,7 @@ namespace AtomToolsFramework
         auto sceneSystem = AzFramework::SceneSystemInterface::Get();
         AZ_Assert(sceneSystem, "Failed to get scene system implementation.");
 
-        AZ::Outcome<AZStd::shared_ptr<AzFramework::Scene>, AZStd::string> createSceneOutcome = sceneSystem->CreateScene(m_sceneName);
+        AZ::Outcome<AZStd::shared_ptr<AzFramework::Scene>, AZStd::string> createSceneOutcome = sceneSystem->CreateScene(sceneName);
         AZ_Assert(createSceneOutcome, createSceneOutcome.GetError().c_str());
 
         m_frameworkScene = createSceneOutcome.TakeValue();
@@ -56,7 +59,7 @@ namespace AtomToolsFramework
         // Create a render pipeline from the specified asset for the window context and add the pipeline to the scene
         AZ::RPI::RenderPipelineDescriptor pipelineDesc;
         pipelineDesc.m_mainViewTagName = "MainCamera";
-        pipelineDesc.m_name = m_pipelineName;
+        pipelineDesc.m_name = pipelineName;
         pipelineDesc.m_rootPassTemplate = "MainPipelineRenderToTexture";
 
         // We have to set the samples to 4 to match the pipeline passes' setting, otherwise it may lead to device lost issue
@@ -66,7 +69,7 @@ namespace AtomToolsFramework
         m_scene->AddRenderPipeline(m_renderPipeline);
         m_scene->Activate();
         AZ::RPI::RPISystemInterface::Get()->RegisterScene(m_scene);
-        m_passHierarchy.push_back(m_pipelineName);
+        m_passHierarchy.push_back(pipelineName);
         m_passHierarchy.push_back("CopyToSwapChain");
 
         // Connect camera to pipeline's default view after camera entity activated
@@ -97,6 +100,11 @@ namespace AtomToolsFramework
         m_frameworkScene->UnsetSubsystem(m_entityContext.get());
     }
 
+    void PreviewRenderer::AddCaptureRequest(const CaptureRequest& captureRequest)
+    {
+        m_captureRequestQueue.push(captureRequest);
+    }
+
     AZ::RPI::ScenePtr PreviewRenderer::GetScene() const
     {
         return m_scene;
@@ -112,11 +120,6 @@ namespace AtomToolsFramework
         return m_entityContext->GetContextId();
     }
 
-    void PreviewRenderer::AddCaptureRequest(const CaptureRequest& captureRequest)
-    {
-        m_captureRequestQueue.push(captureRequest);
-    }
-
     void PreviewRenderer::SetState(State state)
     {
         auto stepItr = m_states.find(m_currentState);
@@ -199,9 +202,9 @@ namespace AtomToolsFramework
         {
             if (result.m_dataBuffer)
             {
-                currentCaptureRequest.m_captureCompleteCallback(QImage(
+                currentCaptureRequest.m_captureCompleteCallback(QPixmap::fromImage(QImage(
                     result.m_dataBuffer.get()->data(), result.m_imageDescriptor.m_size.m_width, result.m_imageDescriptor.m_size.m_height,
-                    QImage::Format_RGBA8888));
+                    QImage::Format_RGBA8888)));
             }
             else
             {
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentNotificationBus.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentNotificationBus.h
new file mode 100644
index 0000000000..4e655c7835
--- /dev/null
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentNotificationBus.h
@@ -0,0 +1,35 @@
+/*
+ * Copyright (c) Contributors to the Open 3D Engine Project.
+ * For complete copyright and license terms please see the LICENSE at the root of this distribution.
+ *
+ * SPDX-License-Identifier: Apache-2.0 OR MIT
+ *
+ */
+#pragma once
+
+#include <Atom/Feature/Material/MaterialAssignmentId.h>
+#include <AzCore/Component/EntityId.h>
+#include <AzCore/EBus/EBus.h>
+#include <AzCore/std/string/string.h>
+
+class QPixmap;
+
+namespace AZ
+{
+    namespace Render
+    {
+        //! EditorMaterialSystemComponentNotifications provides an interface to communicate with EditorMaterialSystemComponent
+        class EditorMaterialSystemComponentNotifications : public AZ::EBusTraits
+        {
+        public:
+            // Only a single handler is allowed
+            static const AZ::EBusAddressPolicy AddressPolicy = AZ::EBusAddressPolicy::Single;
+            static const AZ::EBusHandlerPolicy HandlerPolicy = AZ::EBusHandlerPolicy::Multiple;
+
+            //! Notify that a material preview image is ready
+            virtual void OnRenderMaterialPreviewComplete(
+                const AZ::EntityId& entityId, const AZ::Render::MaterialAssignmentId& materialAssignmentId, const QPixmap& pixmap) = 0;
+        };
+        using EditorMaterialSystemComponentNotificationBus = AZ::EBus<EditorMaterialSystemComponentNotifications>;
+    } // namespace Render
+} // namespace AZ
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h
index 47fad038b6..059e6dec8e 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h
@@ -5,6 +5,7 @@
  * SPDX-License-Identifier: Apache-2.0 OR MIT
  *
  */
+
 #pragma once
 
 #include <Atom/Feature/Material/MaterialAssignmentId.h>
@@ -17,8 +18,7 @@ namespace AZ
     namespace Render
     {
         //! EditorMaterialSystemComponentRequests provides an interface to communicate with MaterialEditor
-        class EditorMaterialSystemComponentRequests
-            : public AZ::EBusTraits
+        class EditorMaterialSystemComponentRequests : public AZ::EBusTraits
         {
         public:
             // Only a single handler is allowed
@@ -31,6 +31,10 @@ namespace AZ
             //! Open material instance editor
             virtual void OpenMaterialInspector(
                 const AZ::EntityId& entityId, const AZ::Render::MaterialAssignmentId& materialAssignmentId) = 0;
+
+            //! Generate a material preview image
+            virtual void RenderMaterialPreview(
+                const AZ::EntityId& entityId, const AZ::Render::MaterialAssignmentId& materialAssignmentId) = 0;
         };
         using EditorMaterialSystemComponentRequestBus = AZ::EBus<EditorMaterialSystemComponentRequests>;
     } // namespace Render
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/EditorCommonFeaturesSystemComponent.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/EditorCommonFeaturesSystemComponent.cpp
index 19a7eda24b..34cd9f59d0 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/EditorCommonFeaturesSystemComponent.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/EditorCommonFeaturesSystemComponent.cpp
@@ -98,9 +98,9 @@ namespace AZ
 
         void EditorCommonFeaturesSystemComponent::Deactivate()
         {
-            AzToolsFramework::EditorLevelNotificationBus::Handler::BusDisconnect();
             AzFramework::ApplicationLifecycleEvents::Bus::Handler::BusDisconnect();
             AzFramework::AssetCatalogEventBus::Handler::BusDisconnect();
+            AzToolsFramework::EditorLevelNotificationBus::Handler::BusDisconnect();
             AzToolsFramework::AssetBrowser::PreviewerRequestBus::Handler::BusDisconnect();
 
             m_skinnedMeshDebugDisplay.reset();
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.cpp
index 665adcd568..7562049031 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.cpp
@@ -23,10 +23,6 @@
 #include <AzToolsFramework/API/EditorAssetSystemAPI.h>
 #include <AzToolsFramework/API/EditorWindowRequestBus.h>
 #include <AzToolsFramework/API/ToolsApplicationAPI.h>
-#include <AzToolsFramework/AssetBrowser/Thumbnails/ProductThumbnail.h>
-#include <AzToolsFramework/Thumbnails/ThumbnailContext.h>
-#include <AzToolsFramework/Thumbnails/ThumbnailWidget.h>
-#include <AzToolsFramework/Thumbnails/ThumbnailerBus.h>
 #include <AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h>
 #include <AtomLyIntegration/CommonFeatures/Material/MaterialComponentBus.h>
 #include <AtomLyIntegration/CommonFeatures/Material/MaterialComponentConfig.h>
@@ -49,29 +45,18 @@ namespace AZ
             MaterialPropertyInspector::MaterialPropertyInspector(QWidget* parent)
                 : AtomToolsFramework::InspectorWidget(parent)
             {
-                // Create the menu button
-                QToolButton* menuButton = new QToolButton(this);
-                menuButton->setAutoRaise(true);
-                menuButton->setIcon(QIcon(":/Cards/img/UI20/Cards/menu_ico.svg"));
-                menuButton->setVisible(true);
-                QObject::connect(menuButton, &QToolButton::clicked, this, [this]() { OpenMenu(); });
-                AddHeading(menuButton);
-
-                m_messageLabel = new QLabel(this);
-                m_messageLabel->setWordWrap(true);
-                m_messageLabel->setVisible(true);
-                m_messageLabel->setAlignment(Qt::AlignCenter);
-                m_messageLabel->setText(tr("Material not available"));
-                AddHeading(m_messageLabel);
-
+                CreateHeading();
+                AZ::TickBus::Handler::BusConnect();
                 AZ::EntitySystemBus::Handler::BusConnect();
+                EditorMaterialSystemComponentNotificationBus::Handler::BusConnect();
             }
 
             MaterialPropertyInspector::~MaterialPropertyInspector()
             {
                 AtomToolsFramework::InspectorRequestBus::Handler::BusDisconnect();
-                AZ::EntitySystemBus::Handler::BusDisconnect();
                 AZ::TickBus::Handler::BusDisconnect();
+                AZ::EntitySystemBus::Handler::BusDisconnect();
+                EditorMaterialSystemComponentNotificationBus::Handler::BusDisconnect();
                 MaterialComponentNotificationBus::Handler::BusDisconnect();
             }
 
@@ -140,7 +125,7 @@ namespace AZ
                 }
 
                 Populate();
-                m_messageLabel->setVisible(false);
+                LoadOverridesFromEntity();
                 return true;
             }
 
@@ -152,8 +137,9 @@ namespace AZ
                 m_dirtyPropertyFlags.set();
                 m_editorFunctors = {};
                 m_internalEditNotification = {};
-                m_messageLabel->setVisible(true);
-                m_messageLabel->setText(tr("Material not available"));
+                m_updateUI = {};
+                m_updatePreview = {};
+                UpdateHeading();
             }
 
             bool MaterialPropertyInspector::IsLoaded() const
@@ -168,49 +154,62 @@ namespace AZ
                 m_dirtyPropertyFlags.set();
                 m_internalEditNotification = {};
 
-                AZ::TickBus::Handler::BusDisconnect();
                 AtomToolsFramework::InspectorRequestBus::Handler::BusDisconnect();
                 AtomToolsFramework::InspectorWidget::Reset();
             }
 
-            void MaterialPropertyInspector::AddDetailsGroup()
+            void MaterialPropertyInspector::CreateHeading()
             {
-                const AZStd::string& groupName = "Details";
-                const AZStd::string& groupDisplayName = "Details";
-                const AZStd::string& groupDescription = "";
+                // Create the menu button
+                QToolButton* menuButton = new QToolButton(this);
+                menuButton->setAutoRaise(true);
+                menuButton->setIcon(QIcon(":/Cards/img/UI20/Cards/menu_ico.svg"));
+                menuButton->setVisible(true);
+                QObject::connect(menuButton, &QToolButton::clicked, this, [this]() { OpenMenu(); });
+                AddHeading(menuButton);
 
-                auto propertyGroupContainer = new QWidget(this);
-                propertyGroupContainer->setLayout(new QHBoxLayout());
+                m_overviewImage = new QLabel(this);
+                m_overviewImage->setFixedSize(QSize(120, 120));
+                m_overviewImage->setVisible(false);
 
-                AzToolsFramework::Thumbnailer::SharedThumbnailKey thumbnailKey =
-                    MAKE_TKEY(AzToolsFramework::AssetBrowser::ProductThumbnailKey, m_editData.m_materialAssetId);
-                auto thumbnailWidget = new AzToolsFramework::Thumbnailer::ThumbnailWidget(this);
-                thumbnailWidget->setFixedSize(QSize(120, 120));
-                thumbnailWidget->setVisible(true);
-                thumbnailWidget->SetThumbnailKey(thumbnailKey, AzToolsFramework::Thumbnailer::ThumbnailContext::DefaultContext);
-                propertyGroupContainer->layout()->addWidget(thumbnailWidget);
-
-                auto materialInfoWidget = new QLabel(this);
+                m_overviewText = new QLabel(this);
                 QSizePolicy sizePolicy1(QSizePolicy::Ignored, QSizePolicy::Preferred);
                 sizePolicy1.setHorizontalStretch(0);
                 sizePolicy1.setVerticalStretch(0);
-                sizePolicy1.setHeightForWidth(materialInfoWidget->sizePolicy().hasHeightForWidth());
-                materialInfoWidget->setSizePolicy(sizePolicy1);
-                materialInfoWidget->setMinimumSize(QSize(0, 0));
-                materialInfoWidget->setMaximumSize(QSize(16777215, 16777215));
-                materialInfoWidget->setTextFormat(Qt::AutoText);
-                materialInfoWidget->setScaledContents(false);
-                materialInfoWidget->setAlignment(Qt::AlignLeading | Qt::AlignLeft | Qt::AlignTop);
-                materialInfoWidget->setWordWrap(true);
+                sizePolicy1.setHeightForWidth(m_overviewText->sizePolicy().hasHeightForWidth());
+                m_overviewText->setSizePolicy(sizePolicy1);
+                m_overviewText->setMinimumSize(QSize(0, 0));
+                m_overviewText->setMaximumSize(QSize(16777215, 16777215));
+                m_overviewText->setTextFormat(Qt::AutoText);
+                m_overviewText->setScaledContents(false);
+                m_overviewText->setWordWrap(true);
+                m_overviewText->setVisible(true);
+
+                auto overviewContainer = new QWidget(this);
+                overviewContainer->setLayout(new QHBoxLayout());
+                overviewContainer->layout()->addWidget(m_overviewImage);
+                overviewContainer->layout()->addWidget(m_overviewText);
+                AddHeading(overviewContainer);
+            }
+
+            void MaterialPropertyInspector::UpdateHeading()
+            {
+                if (!IsLoaded())
+                {
+                    m_overviewText->setText(tr("Material not available"));
+                    m_overviewText->setAlignment(Qt::AlignCenter);
+                    m_overviewImage->setVisible(false);
+                    return;
+                }
 
                 QFileInfo materialFileInfo(AZ::RPI::AssetUtils::GetProductPathByAssetId(m_editData.m_materialAsset.GetId()).c_str());
                 QFileInfo materialSourceFileInfo(m_editData.m_materialSourcePath.c_str());
                 QFileInfo materialTypeSourceFileInfo(m_editData.m_materialTypeSourcePath.c_str());
-                QFileInfo materialParentSourceFileInfo(AZ::RPI::AssetUtils::GetSourcePathByAssetId(m_editData.m_materialParentAsset.GetId()).c_str());
+                QFileInfo materialParentSourceFileInfo(
+                    AZ::RPI::AssetUtils::GetSourcePathByAssetId(m_editData.m_materialParentAsset.GetId()).c_str());
 
                 AZStd::string entityName;
-                AZ::ComponentApplicationBus::BroadcastResult(
-                    entityName, &AZ::ComponentApplicationBus::Events::GetEntityName, m_entityId);
+                AZ::ComponentApplicationBus::BroadcastResult(entityName, &AZ::ComponentApplicationBus::Events::GetEntityName, m_entityId);
 
                 AZStd::string slotName;
                 MaterialComponentRequestBus::EventResult(
@@ -226,7 +225,8 @@ namespace AZ
                 }
                 if (!materialTypeSourceFileInfo.fileName().isEmpty())
                 {
-                    materialInfo += tr("<tr><td><b>Material Type&emsp;</b></td><td>%1</td></tr>").arg(materialTypeSourceFileInfo.fileName());
+                    materialInfo +=
+                        tr("<tr><td><b>Material Type&emsp;</b></td><td>%1</td></tr>").arg(materialTypeSourceFileInfo.fileName());
                 }
                 if (!materialSourceFileInfo.fileName().isEmpty())
                 {
@@ -234,14 +234,15 @@ namespace AZ
                 }
                 if (!materialParentSourceFileInfo.fileName().isEmpty())
                 {
-                    materialInfo += tr("<tr><td><b>Material Parent&emsp;</b></td><td>%1</td></tr>").arg(materialParentSourceFileInfo.fileName());
+                    materialInfo +=
+                        tr("<tr><td><b>Material Parent&emsp;</b></td><td>%1</td></tr>").arg(materialParentSourceFileInfo.fileName());
                 }
                 materialInfo += tr("</table>");
-                materialInfoWidget->setText(materialInfo);
 
-                propertyGroupContainer->layout()->addWidget(materialInfoWidget);
-
-                AddGroup(groupName, groupDisplayName, groupDescription, propertyGroupContainer);
+                m_overviewText->setText(materialInfo);
+                m_overviewText->setAlignment(Qt::AlignLeading | Qt::AlignLeft | Qt::AlignTop);
+                m_overviewImage->setVisible(true);
+                m_updatePreview = true;
             }
 
             void MaterialPropertyInspector::AddUvNamesGroup()
@@ -282,13 +283,8 @@ namespace AZ
                 AddGroup(groupName, groupDisplayName, groupDescription, propertyGroupWidget);
             }
 
-            void MaterialPropertyInspector::Populate()
+            void MaterialPropertyInspector::AddPropertiesGroup()
             {
-                AddGroupsBegin();
-
-                AddDetailsGroup();
-                AddUvNamesGroup();
-
                 // Copy all of the properties from the material asset to the source data that will be exported
                 for (const auto& groupDefinition : m_editData.m_materialTypeSourceData.GetGroupDefinitionsInDisplayOrder())
                 {
@@ -327,10 +323,14 @@ namespace AZ
                         [this](const auto node) { return GetInstanceNodePropertyIndicator(node); }, 0);
                     AddGroup(groupName, groupDisplayName, groupDescription, propertyGroupWidget);
                 }
+            }
 
+            void MaterialPropertyInspector::Populate()
+            {
+                AddGroupsBegin();
+                AddUvNamesGroup();
+                AddPropertiesGroup();
                 AddGroupsEnd();
-
-                LoadOverridesFromEntity();
             }
 
             void MaterialPropertyInspector::LoadOverridesFromEntity()
@@ -375,6 +375,7 @@ namespace AZ
                 m_dirtyPropertyFlags.set();
                 RunEditorMaterialFunctors();
                 RebuildAll();
+                UpdateHeading();
             }
 
             void MaterialPropertyInspector::SaveOverridesToEntity(bool commitChanges)
@@ -398,6 +399,8 @@ namespace AZ
                     MaterialComponentNotificationBus::Event(m_entityId, &MaterialComponentNotifications::OnMaterialsEdited);
                     m_internalEditNotification = false;
                 }
+
+                m_updatePreview = true;
             }
 
             void MaterialPropertyInspector::RunEditorMaterialFunctors()
@@ -607,7 +610,8 @@ namespace AZ
                     MaterialComponentRequestBus::Event(
                         m_entityId, &MaterialComponentRequestBus::Events::SetPropertyOverrides, m_materialAssignmentId,
                         MaterialPropertyOverrideMap());
-                    QueueUpdateUI();
+                    m_updateUI = true;
+                    m_updatePreview = true;
                 });
                 action->setEnabled(IsLoaded());
 
@@ -702,10 +706,7 @@ namespace AZ
 
             void MaterialPropertyInspector::OnEntityActivated(const AZ::EntityId& entityId)
             {
-                if (m_entityId == entityId)
-                {
-                    QueueUpdateUI();
-                }
+                m_updateUI |= (m_entityId == entityId);
             }
 
             void MaterialPropertyInspector::OnEntityDeactivated(const AZ::EntityId& entityId)
@@ -719,25 +720,39 @@ namespace AZ
             void MaterialPropertyInspector::OnEntityNameChanged(const AZ::EntityId& entityId, const AZStd::string& name)
             {
                 AZ_UNUSED(name);
-                if (m_entityId == entityId)
-                {
-                    QueueUpdateUI();
-                }
+                m_updateUI |= (m_entityId == entityId);
             }
 
             void MaterialPropertyInspector::OnTick(float deltaTime, ScriptTimePoint time)
             {
                 AZ_UNUSED(time);
                 AZ_UNUSED(deltaTime);
-                UpdateUI();
-                AZ::TickBus::Handler::BusDisconnect();
+                if (m_updateUI)
+                {
+                    m_updateUI = false;
+                    UpdateUI();
+                }
+
+                if (m_updatePreview)
+                {
+                    m_updatePreview = false;
+                    EditorMaterialSystemComponentRequestBus::Broadcast(
+                        &EditorMaterialSystemComponentRequestBus::Events::RenderMaterialPreview, m_entityId, m_materialAssignmentId);
+                }
             }
 
             void MaterialPropertyInspector::OnMaterialsEdited()
             {
-                if (!m_internalEditNotification)
+                m_updateUI |= !m_internalEditNotification;
+                m_updatePreview = true;
+            }
+
+            void MaterialPropertyInspector::OnRenderMaterialPreviewComplete(
+                const AZ::EntityId& entityId, const AZ::Render::MaterialAssignmentId& materialAssignmentId, const QPixmap& pixmap)
+            {
+                if (m_overviewImage && m_entityId == entityId && m_materialAssignmentId == materialAssignmentId)
                 {
-                    QueueUpdateUI();
+                    m_overviewImage->setPixmap(pixmap);
                 }
             }
 
@@ -761,14 +776,6 @@ namespace AZ
                     LoadMaterial(m_entityId, m_materialAssignmentId);
                 }
             }
-
-            void MaterialPropertyInspector::QueueUpdateUI()
-            {
-                if (!AZ::TickBus::Handler::BusIsConnected())
-                {
-                    AZ::TickBus::Handler::BusConnect();
-                }
-            }
         } // namespace EditorMaterialComponentInspector
     } // namespace Render
 } // namespace AZ
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.h
index 048c1e19cb..6199fba179 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentInspector.h
@@ -9,6 +9,7 @@
 #pragma once
 
 #if !defined(Q_MOC_RUN)
+#include <AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentNotificationBus.h>
 #include <AtomLyIntegration/CommonFeatures/Material/MaterialComponentBus.h>
 #include <AtomToolsFramework/DynamicProperty/DynamicPropertyGroup.h>
 #include <AtomToolsFramework/Inspector/InspectorWidget.h>
@@ -39,6 +40,7 @@ namespace AZ
                 , public AZ::EntitySystemBus::Handler
                 , public AZ::TickBus::Handler
                 , public MaterialComponentNotificationBus::Handler
+                , public EditorMaterialSystemComponentNotificationBus::Handler
            {
                 Q_OBJECT
             public:
@@ -89,11 +91,19 @@ namespace AZ
                 //! MaterialComponentNotificationBus::Handler overrides...
                 void OnMaterialsEdited() override;
 
-                void UpdateUI();
-                void QueueUpdateUI();
+                //! EditorMaterialSystemComponentNotificationBus::Handler overrides...
+                void OnRenderMaterialPreviewComplete(
+                    const AZ::EntityId& entityId,
+                    const AZ::Render::MaterialAssignmentId& materialAssignmentId,
+                    const QPixmap& pixmap) override;
+
+                void UpdateUI();
+
+                void CreateHeading();
+                void UpdateHeading();
 
-                void AddDetailsGroup();
                 void AddUvNamesGroup();
+                void AddPropertiesGroup();
 
                 void LoadOverridesFromEntity();
                 void SaveOverridesToEntity(bool commitChanges);
@@ -115,7 +125,10 @@ namespace AZ
                 AZ::RPI::MaterialPropertyFlags m_dirtyPropertyFlags = {};
                 AZStd::unordered_map<AZStd::string, AtomToolsFramework::DynamicPropertyGroup> m_groups = {};
                 bool m_internalEditNotification = {};
-                QLabel* m_messageLabel = {};
+                bool m_updateUI = {};
+                bool m_updatePreview = {};
+                QLabel* m_overviewText = {};
+                QLabel* m_overviewImage = {};
            };
         } // namespace EditorMaterialComponentInspector
     } // namespace Render
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentSlot.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentSlot.cpp
index f5d38f48c4..21d045a072 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentSlot.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialComponentSlot.cpp
@@ -315,6 +315,9 @@ namespace AZ
             AzToolsFramework::ToolsApplicationRequests::Bus::Broadcast(
                 &AzToolsFramework::ToolsApplicationRequests::Bus::Events::AddDirtyEntity, m_entityId);
 
+            EditorMaterialSystemComponentRequestBus::Broadcast(
+                &EditorMaterialSystemComponentRequestBus::Events::RenderMaterialPreview, m_entityId, m_id);
+
             MaterialComponentNotificationBus::Event(m_entityId, &MaterialComponentNotifications::OnMaterialsEdited);
 
             AzToolsFramework::ToolsApplicationEvents::Bus::Broadcast(
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.cpp
index 9efa8eb333..e18cc0b907 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.cpp
@@ -6,7 +6,10 @@
  *
  */
 
+#include <AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentNotificationBus.h>
 #include <Atom/RHI/Factory.h>
+#include <Atom/RPI.Reflect/Asset/AssetUtils.h>
+#include <AtomLyIntegration/CommonFeatures/Material/MaterialComponentBus.h>
 #include <AtomToolsFramework/Util/Util.h>
 #include <AzCore/Serialization/EditContext.h>
 #include <AzCore/Serialization/EditContextConstants.inl>
@@ -19,6 +22,7 @@
 #include <Editor/LyViewPaneNames.h>
 #include <Material/EditorMaterialComponentInspector.h>
 #include <Material/EditorMaterialSystemComponent.h>
+#include <Previewer/CommonPreviewContent.h>
 
 // Disables warning messages triggered by the Qt library
 // 4251: class needs to have dll-interface to be used by clients of class 
@@ -28,6 +32,8 @@ AZ_PUSH_DISABLE_WARNING(4251 4800, "-Wunknown-warning-option")
 #include <QApplication>
 #include <QDockWidget>
 #include <QObject>
+#include <QPixmap>
+#include <QImage>
 #include <QProcessEnvironment>
 AZ_POP_DISABLE_WARNING
 
@@ -86,17 +92,20 @@ namespace AZ
             AzToolsFramework::AssetBrowser::AssetBrowserInteractionNotificationBus::Handler::BusConnect();
             AzToolsFramework::EditorMenuNotificationBus::Handler::BusConnect();
             AzToolsFramework::EditorEvents::Bus::Handler::BusConnect();
-
-            m_materialBrowserInteractions.reset(aznew MaterialBrowserInteractions);
+            AzFramework::AssetCatalogEventBus::Handler::BusConnect();
+            AzFramework::ApplicationLifecycleEvents::Bus::Handler::BusConnect();
         }
 
         void EditorMaterialSystemComponent::Deactivate()
         {
+            AzFramework::ApplicationLifecycleEvents::Bus::Handler::BusDisconnect();
+            AzFramework::AssetCatalogEventBus::Handler::BusDisconnect();
             EditorMaterialSystemComponentRequestBus::Handler::BusDisconnect();
             AzToolsFramework::AssetBrowser::AssetBrowserInteractionNotificationBus::Handler::BusDisconnect();
             AzToolsFramework::EditorMenuNotificationBus::Handler::BusDisconnect();
             AzToolsFramework::EditorEvents::Bus::Handler::BusDisconnect(); 
 
+            m_previewRenderer.reset();
             m_materialBrowserInteractions.reset();
 
             if (m_openMaterialEditorAction)
@@ -143,6 +152,47 @@ namespace AZ
             }
         }
 
+        void EditorMaterialSystemComponent::RenderMaterialPreview(
+            const AZ::EntityId& entityId, const AZ::Render::MaterialAssignmentId& materialAssignmentId)
+        {
+            static constexpr const char* DefaultModelPath = "models/sphere.azmodel";
+            static constexpr const char* DefaultLightingPresetPath = "lightingpresets/thumbnail.lightingpreset.azasset";
+
+            if (m_previewRenderer)
+            {
+                AZ::Data::AssetId materialAssetId = {};
+                MaterialComponentRequestBus::EventResult(
+                    materialAssetId, entityId, &MaterialComponentRequestBus::Events::GetMaterialOverride, materialAssignmentId);
+                if (!materialAssetId.IsValid())
+                {
+                    MaterialComponentRequestBus::EventResult(
+                        materialAssetId, entityId, &MaterialComponentRequestBus::Events::GetDefaultMaterialAssetId, materialAssignmentId);
+                }
+
+                AZ::Render::MaterialPropertyOverrideMap propertyOverrides;
+                AZ::Render::MaterialComponentRequestBus::EventResult(
+                    propertyOverrides, entityId, &AZ::Render::MaterialComponentRequestBus::Events::GetPropertyOverrides,
+                    materialAssignmentId);
+
+                m_previewRenderer->AddCaptureRequest(
+                    { 128,
+                      AZStd::make_shared<AZ::LyIntegration::CommonPreviewContent>(
+                          m_previewRenderer->GetScene(), m_previewRenderer->GetView(), m_previewRenderer->GetEntityContextId(),
+                          AZ::RPI::AssetUtils::GetAssetIdForProductPath(DefaultModelPath), materialAssetId,
+                          AZ::RPI::AssetUtils::GetAssetIdForProductPath(DefaultLightingPresetPath), propertyOverrides),
+                      []()
+                      {
+                          // failed
+                      },
+                      [entityId, materialAssignmentId](const QPixmap& pixmap)
+                      {
+                          AZ::Render::EditorMaterialSystemComponentNotificationBus::Broadcast(
+                              &AZ::Render::EditorMaterialSystemComponentNotificationBus::Events::OnRenderMaterialPreviewComplete, entityId,
+                              materialAssignmentId, pixmap);
+                      } });
+            }
+        }
+
         void EditorMaterialSystemComponent::OnPopulateToolMenuItems()
         {
             if (!m_openMaterialEditorAction)
@@ -185,6 +235,21 @@ namespace AZ
                 "Material Property Inspector", LyViewPane::CategoryTools, inspectorOptions);
         }
 
+        void EditorMaterialSystemComponent::OnCatalogLoaded([[maybe_unused]] const char* catalogFile)
+        {
+            AZ::TickBus::QueueFunction([this](){
+                m_materialBrowserInteractions.reset(aznew MaterialBrowserInteractions);
+                m_previewRenderer.reset(aznew AtomToolsFramework::PreviewRenderer(
+                    "EditorMaterialSystemComponent Preview Scene", "EditorMaterialSystemComponent Preview Pipeline"));
+            });
+        }
+
+        void EditorMaterialSystemComponent::OnApplicationAboutToStop()
+        {
+            m_previewRenderer.reset();
+            m_materialBrowserInteractions.reset();
+        }
+
         AzToolsFramework::AssetBrowser::SourceFileDetails EditorMaterialSystemComponent::GetSourceFileDetails(
             const char* fullSourceFileName)
         {
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.h
index 60e489f55e..f2ccbdc435 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Material/EditorMaterialSystemComponent.h
@@ -7,13 +7,14 @@
  */
 #pragma once
 
+#include <AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h>
+#include <AtomToolsFramework/PreviewRenderer/PreviewRenderer.h>
+#include <AzCore/Asset/AssetCommon.h>
 #include <AzCore/Component/Component.h>
+#include <AzFramework/Application/Application.h>
 #include <AzToolsFramework/API/ToolsApplicationAPI.h>
 #include <AzToolsFramework/AssetBrowser/AssetBrowserBus.h>
 #include <AzToolsFramework/Viewport/ActionBus.h>
-
-#include <AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h>
-
 #include <Material/MaterialBrowserInteractions.h>
 
 namespace AZ
@@ -21,12 +22,14 @@ namespace AZ
     namespace Render
     {
         //! System component that manages launching and maintaining connections with the material editor.
-        class EditorMaterialSystemComponent
+        class EditorMaterialSystemComponent final
             : public AZ::Component
-            , private EditorMaterialSystemComponentRequestBus::Handler
-            , private AzToolsFramework::AssetBrowser::AssetBrowserInteractionNotificationBus::Handler
-            , private AzToolsFramework::EditorMenuNotificationBus::Handler
-            , private AzToolsFramework::EditorEvents::Bus::Handler
+            , public EditorMaterialSystemComponentRequestBus::Handler
+            , public AzToolsFramework::AssetBrowser::AssetBrowserInteractionNotificationBus::Handler
+            , public AzToolsFramework::EditorMenuNotificationBus::Handler
+            , public AzToolsFramework::EditorEvents::Bus::Handler
+            , public AzFramework::AssetCatalogEventBus::Handler
+            , public AzFramework::ApplicationLifecycleEvents::Bus::Handler
         {
         public:
             AZ_COMPONENT(EditorMaterialSystemComponent, "{96652157-DA0B-420F-B49C-0207C585144C}");
@@ -47,6 +50,8 @@ namespace AZ
             //! EditorMaterialSystemComponentRequestBus::Handler overrides...
             void OpenMaterialEditor(const AZStd::string& sourcePath) override;
             void OpenMaterialInspector(const AZ::EntityId& entityId, const AZ::Render::MaterialAssignmentId& materialAssignmentId) override;
+            void RenderMaterialPreview(
+                const AZ::EntityId& entityId, const AZ::Render::MaterialAssignmentId& materialAssignmentId) override;
 
             //! AssetBrowserInteractionNotificationBus::Handler overrides...
             AzToolsFramework::AssetBrowser::SourceFileDetails GetSourceFileDetails(const char* fullSourceFileName) override;
@@ -58,9 +63,16 @@ namespace AZ
             // AztoolsFramework::EditorEvents::Bus::Handler overrides...
             void NotifyRegisterViews() override;
 
-            QAction* m_openMaterialEditorAction = nullptr;
 
+            // AzFramework::AssetCatalogEventBus::Handler overrides ...
+            void OnCatalogLoaded(const char* catalogFile) override;
+
+            // AzFramework::ApplicationLifecycleEvents overrides...
+            void OnApplicationAboutToStop() override;
+
+            QAction* m_openMaterialEditorAction = nullptr;
             AZStd::unique_ptr<MaterialBrowserInteractions> m_materialBrowserInteractions;
+            AZStd::unique_ptr<AtomToolsFramework::PreviewRenderer> m_previewRenderer;
         };
     } // namespace Render
 } // namespace AZ
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.cpp
index 6890fabb01..966877317c 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.cpp
@@ -35,10 +35,12 @@ namespace AZ
             AZ::Uuid entityContextId,
             const Data::AssetId& modelAssetId,
             const Data::AssetId& materialAssetId,
-            const Data::AssetId& lightingPresetAssetId)
+            const Data::AssetId& lightingPresetAssetId,
+            const Render::MaterialPropertyOverrideMap& materialPropertyOverrides)
             : m_scene(scene)
             , m_view(view)
             , m_entityContextId(entityContextId)
+            , m_materialPropertyOverrides(materialPropertyOverrides)
         {
             // Create preview model
             AzFramework::EntityContextRequestBus::EventResult(
@@ -49,13 +51,9 @@ namespace AZ
             m_modelEntity->Init();
             m_modelEntity->Activate();
 
-            m_defaultModelAsset.Create(DefaultModelAssetId, true);
-            m_defaultMaterialAsset.Create(DefaultMaterialAssetId, true);
-            m_defaultLightingPresetAsset.Create(DefaultLightingPresetAssetId, true);
-
-            m_modelAsset.Create(modelAssetId.IsValid() ? modelAssetId : DefaultModelAssetId, false);
-            m_materialAsset.Create(materialAssetId.IsValid() ? materialAssetId : DefaultMaterialAssetId, false);
-            m_lightingPresetAsset.Create(lightingPresetAssetId.IsValid() ? lightingPresetAssetId : DefaultLightingPresetAssetId, false);
+            m_modelAsset.Create(modelAssetId);
+            m_materialAsset.Create(materialAssetId);
+            m_lightingPresetAsset.Create(lightingPresetAssetId);
         }
 
         CommonPreviewContent::~CommonPreviewContent()
@@ -113,35 +111,44 @@ namespace AZ
                 m_modelEntity->GetId(), &Render::MeshComponentRequestBus::Events::SetModelAsset, m_modelAsset);
 
             Render::MaterialComponentRequestBus::Event(
-                m_modelEntity->GetId(), &Render::MaterialComponentRequestBus::Events::SetDefaultMaterialOverride, m_materialAsset.GetId());
+                m_modelEntity->GetId(), &Render::MaterialComponentRequestBus::Events::SetMaterialOverride,
+                Render::DefaultMaterialAssignmentId, m_materialAsset.GetId());
+
+            Render::MaterialComponentRequestBus::Event(
+                m_modelEntity->GetId(), &Render::MaterialComponentRequestBus::Events::SetPropertyOverrides,
+                Render::DefaultMaterialAssignmentId, m_materialPropertyOverrides);
         }
 
         void CommonPreviewContent::UpdateLighting()
         {
-            auto preset = m_lightingPresetAsset->GetDataAs<Render::LightingPreset>();
-            if (preset)
+            if (m_lightingPresetAsset.IsReady())
             {
-                auto iblFeatureProcessor = m_scene->GetFeatureProcessor<Render::ImageBasedLightFeatureProcessorInterface>();
-                auto postProcessFeatureProcessor = m_scene->GetFeatureProcessor<Render::PostProcessFeatureProcessorInterface>();
-                auto postProcessSettingInterface = postProcessFeatureProcessor->GetOrCreateSettingsInterface(EntityId());
-                auto exposureControlSettingInterface = postProcessSettingInterface->GetOrCreateExposureControlSettingsInterface();
-                auto directionalLightFeatureProcessor = m_scene->GetFeatureProcessor<Render::DirectionalLightFeatureProcessorInterface>();
-                auto skyboxFeatureProcessor = m_scene->GetFeatureProcessor<Render::SkyBoxFeatureProcessorInterface>();
-                skyboxFeatureProcessor->Enable(true);
-                skyboxFeatureProcessor->SetSkyboxMode(Render::SkyBoxMode::Cubemap);
+                auto preset = m_lightingPresetAsset->GetDataAs<Render::LightingPreset>();
+                if (preset)
+                {
+                    auto iblFeatureProcessor = m_scene->GetFeatureProcessor<Render::ImageBasedLightFeatureProcessorInterface>();
+                    auto postProcessFeatureProcessor = m_scene->GetFeatureProcessor<Render::PostProcessFeatureProcessorInterface>();
+                    auto postProcessSettingInterface = postProcessFeatureProcessor->GetOrCreateSettingsInterface(EntityId());
+                    auto exposureControlSettingInterface = postProcessSettingInterface->GetOrCreateExposureControlSettingsInterface();
+                    auto directionalLightFeatureProcessor =
+                        m_scene->GetFeatureProcessor<Render::DirectionalLightFeatureProcessorInterface>();
+                    auto skyboxFeatureProcessor = m_scene->GetFeatureProcessor<Render::SkyBoxFeatureProcessorInterface>();
+                    skyboxFeatureProcessor->Enable(true);
+                    skyboxFeatureProcessor->SetSkyboxMode(Render::SkyBoxMode::Cubemap);
 
-                Camera::Configuration cameraConfig;
-                cameraConfig.m_fovRadians = FieldOfView;
-                cameraConfig.m_nearClipDistance = NearDist;
-                cameraConfig.m_farClipDistance = FarDist;
-                cameraConfig.m_frustumWidth = 100.0f;
-                cameraConfig.m_frustumHeight = 100.0f;
+                    Camera::Configuration cameraConfig;
+                    cameraConfig.m_fovRadians = FieldOfView;
+                    cameraConfig.m_nearClipDistance = NearDist;
+                    cameraConfig.m_farClipDistance = FarDist;
+                    cameraConfig.m_frustumWidth = 100.0f;
+                    cameraConfig.m_frustumHeight = 100.0f;
 
-                AZStd::vector<Render::DirectionalLightFeatureProcessorInterface::LightHandle> lightHandles;
+                    AZStd::vector<Render::DirectionalLightFeatureProcessorInterface::LightHandle> lightHandles;
 
-                preset->ApplyLightingPreset(
-                    iblFeatureProcessor, skyboxFeatureProcessor, exposureControlSettingInterface, directionalLightFeatureProcessor,
-                    cameraConfig, lightHandles);
+                    preset->ApplyLightingPreset(
+                        iblFeatureProcessor, skyboxFeatureProcessor, exposureControlSettingInterface, directionalLightFeatureProcessor,
+                        cameraConfig, lightHandles);
+                }
             }
         }
 
@@ -157,8 +164,8 @@ namespace AZ
 
             const auto distance = radius + NearDist;
             const auto cameraRotation = Quaternion::CreateFromAxisAngle(Vector3::CreateAxisZ(), CameraRotationAngle);
-            const auto cameraPosition = center - cameraRotation.TransformVector(Vector3(0.0f, distance, 0.0f));
-            const auto cameraTransform = Transform::CreateFromQuaternionAndTranslation(cameraRotation, cameraPosition);
+            const auto cameraPosition = center + cameraRotation.TransformVector(Vector3(0.0f, distance, 0.0f));
+            const auto cameraTransform = Transform::CreateLookAt(cameraPosition, center);
             m_view->SetCameraTransform(Matrix3x4::CreateFromTransform(cameraTransform));
         }
     } // namespace LyIntegration
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.h
index 482dde2986..a6bb2f6c4e 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonPreviewContent.h
@@ -8,8 +8,8 @@
 
 #pragma once
 
+#include <Atom/Feature/Material/MaterialAssignment.h>
 #include <Atom/RPI.Public/Base.h>
-#include <Atom/RPI.Reflect/Asset/AssetUtils.h>
 #include <Atom/RPI.Reflect/Material/MaterialAsset.h>
 #include <Atom/RPI.Reflect/Model/ModelAsset.h>
 #include <Atom/RPI.Reflect/System/AnyAsset.h>
@@ -31,7 +31,8 @@ namespace AZ
                 AZ::Uuid entityContextId,
                 const Data::AssetId& modelAssetId,
                 const Data::AssetId& materialAssetId,
-                const Data::AssetId& lightingPresetAssetId);
+                const Data::AssetId& lightingPresetAssetId,
+                const Render::MaterialPropertyOverrideMap& materialPropertyOverrides);
 
             ~CommonPreviewContent() override;
 
@@ -57,22 +58,10 @@ namespace AZ
             AZ::Uuid m_entityContextId;
             Entity* m_modelEntity = nullptr;
 
-            static constexpr const char* DefaultLightingPresetPath = "lightingpresets/thumbnail.lightingpreset.azasset";
-            const Data::AssetId DefaultLightingPresetAssetId = AZ::RPI::AssetUtils::GetAssetIdForProductPath(DefaultLightingPresetPath);
-            Data::Asset<RPI::AnyAsset> m_defaultLightingPresetAsset;
-            Data::Asset<RPI::AnyAsset> m_lightingPresetAsset;
-
-            //! Model asset about to be rendered
-            static constexpr const char* DefaultModelPath = "models/sphere.azmodel";
-            const Data::AssetId DefaultModelAssetId = AZ::RPI::AssetUtils::GetAssetIdForProductPath(DefaultModelPath);
-            Data::Asset<RPI::ModelAsset> m_defaultModelAsset;
             Data::Asset<RPI::ModelAsset> m_modelAsset;
-
-            //! Material asset about to be rendered
-            static constexpr const char* DefaultMaterialPath = "materials/basic_grey.azmaterial";
-            const Data::AssetId DefaultMaterialAssetId = AZ::RPI::AssetUtils::GetAssetIdForProductPath(DefaultMaterialPath);
-            Data::Asset<RPI::MaterialAsset> m_defaultMaterialAsset;
             Data::Asset<RPI::MaterialAsset> m_materialAsset;
+            Data::Asset<RPI::AnyAsset> m_lightingPresetAsset;
+            Render::MaterialPropertyOverrideMap m_materialPropertyOverrides;
         };
     } // namespace LyIntegration
 } // namespace AZ
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.cpp
index e9eba7a08d..f29762b563 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.cpp
@@ -20,6 +20,13 @@ namespace AZ
         {
             CommonThumbnailRenderer::CommonThumbnailRenderer()
             {
+                m_previewRenderer.reset(aznew AtomToolsFramework::PreviewRenderer(
+                    "CommonThumbnailRenderer Preview Scene", "CommonThumbnailRenderer Preview Pipeline"));
+
+                m_defaultModelAsset.Create(DefaultModelAssetId, true);
+                m_defaultMaterialAsset.Create(DefaultMaterialAssetId, true);
+                m_defaultLightingPresetAsset.Create(DefaultLightingPresetAssetId, true);
+
                 // CommonThumbnailRenderer supports both models and materials
                 AzToolsFramework::Thumbnailer::ThumbnailerRendererRequestBus::MultiHandler::BusConnect(RPI::MaterialAsset::RTTI_Type());
                 AzToolsFramework::Thumbnailer::ThumbnailerRendererRequestBus::MultiHandler::BusConnect(RPI::ModelAsset::RTTI_Type());
@@ -35,26 +42,24 @@ namespace AZ
 
             void CommonThumbnailRenderer::RenderThumbnail(AzToolsFramework::Thumbnailer::SharedThumbnailKey thumbnailKey, int thumbnailSize)
             {
-                m_previewRenderer.AddCaptureRequest(
+                m_previewRenderer->AddCaptureRequest(
                     { thumbnailSize,
                       AZStd::make_shared<CommonPreviewContent>(
-                          m_previewRenderer.GetScene(),
-                          m_previewRenderer.GetView(),
-                          m_previewRenderer.GetEntityContextId(),
-                          GetAssetId(thumbnailKey, RPI::ModelAsset::RTTI_Type()),
-                          GetAssetId(thumbnailKey, RPI::MaterialAsset::RTTI_Type()),
-                          GetAssetId(thumbnailKey, RPI::AnyAsset::RTTI_Type())),
-                          [thumbnailKey]()
-                          {
-                              AzToolsFramework::Thumbnailer::ThumbnailerRendererNotificationBus::Event(
-                                  thumbnailKey, &AzToolsFramework::Thumbnailer::ThumbnailerRendererNotifications::ThumbnailFailedToRender);
-                          },
-                          [thumbnailKey](const QImage& image)
-                          {
-                              AzToolsFramework::Thumbnailer::ThumbnailerRendererNotificationBus::Event(
-                                  thumbnailKey, &AzToolsFramework::Thumbnailer::ThumbnailerRendererNotifications::ThumbnailRendered,
-                                  QPixmap::fromImage(image));
-                          } });
+                          m_previewRenderer->GetScene(), m_previewRenderer->GetView(), m_previewRenderer->GetEntityContextId(),
+                          GetAssetId(thumbnailKey, RPI::ModelAsset::RTTI_Type(), DefaultModelAssetId),
+                          GetAssetId(thumbnailKey, RPI::MaterialAsset::RTTI_Type(), DefaultMaterialAssetId),
+                          GetAssetId(thumbnailKey, RPI::AnyAsset::RTTI_Type(), DefaultLightingPresetAssetId),
+                          Render::MaterialPropertyOverrideMap()),
+                      [thumbnailKey]()
+                      {
+                          AzToolsFramework::Thumbnailer::ThumbnailerRendererNotificationBus::Event(
+                              thumbnailKey, &AzToolsFramework::Thumbnailer::ThumbnailerRendererNotifications::ThumbnailFailedToRender);
+                      },
+                      [thumbnailKey](const QPixmap& pixmap)
+                      {
+                          AzToolsFramework::Thumbnailer::ThumbnailerRendererNotificationBus::Event(
+                              thumbnailKey, &AzToolsFramework::Thumbnailer::ThumbnailerRendererNotifications::ThumbnailRendered, pixmap);
+                      } });
             }
 
             bool CommonThumbnailRenderer::Installed() const
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.h
index 0497521d44..a57c3dae8e 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/CommonThumbnailRenderer.h
@@ -8,6 +8,10 @@
 
 #pragma once
 
+#include <Atom/RPI.Reflect/Asset/AssetUtils.h>
+#include <Atom/RPI.Reflect/Material/MaterialAsset.h>
+#include <Atom/RPI.Reflect/Model/ModelAsset.h>
+#include <Atom/RPI.Reflect/System/AnyAsset.h>
 #include <AtomToolsFramework/PreviewRenderer/PreviewRenderer.h>
 #include <AzCore/Component/TickBus.h>
 #include <AzToolsFramework/Thumbnails/Thumbnail.h>
@@ -39,7 +43,19 @@ namespace AZ
                 //! SystemTickBus::Handler interface overrides...
                 void OnSystemTick() override;
 
-                AtomToolsFramework::PreviewRenderer m_previewRenderer;
+                static constexpr const char* DefaultLightingPresetPath = "lightingpresets/thumbnail.lightingpreset.azasset";
+                const Data::AssetId DefaultLightingPresetAssetId = AZ::RPI::AssetUtils::GetAssetIdForProductPath(DefaultLightingPresetPath);
+                Data::Asset<RPI::AnyAsset> m_defaultLightingPresetAsset;
+
+                static constexpr const char* DefaultModelPath = "models/sphere.azmodel";
+                const Data::AssetId DefaultModelAssetId = AZ::RPI::AssetUtils::GetAssetIdForProductPath(DefaultModelPath);
+                Data::Asset<RPI::ModelAsset> m_defaultModelAsset;
+
+                static constexpr const char* DefaultMaterialPath = "";
+                const Data::AssetId DefaultMaterialAssetId;
+                Data::Asset<RPI::MaterialAsset> m_defaultMaterialAsset;
+
+                AZStd::unique_ptr<AtomToolsFramework::PreviewRenderer> m_previewRenderer;
             };
         } // namespace Thumbnails
     } // namespace LyIntegration
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.cpp
index 566a8d7b58..6a9c2ca2ca 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.cpp
@@ -53,7 +53,7 @@ namespace AZ
                 AzFramework::AssetCatalogEventBus::Handler::BusDisconnect();
             }
 
-            void LightingPresetThumbnail::ThumbnailRendered(QPixmap& thumbnailImage)
+            void LightingPresetThumbnail::ThumbnailRendered(const QPixmap& thumbnailImage)
             {
                 m_pixmap = thumbnailImage;
                 m_renderWait.release();
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.h
index efbfe5b7d5..437a372c3c 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/LightingPresetThumbnail.h
@@ -33,7 +33,7 @@ namespace AZ
                 ~LightingPresetThumbnail() override;
 
                 //! AzToolsFramework::ThumbnailerRendererNotificationBus::Handler overrides...
-                void ThumbnailRendered(QPixmap& thumbnailImage) override;
+                void ThumbnailRendered(const QPixmap& thumbnailImage) override;
                 void ThumbnailFailedToRender() override;
 
             protected:
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.cpp
index b6a93aa59c..b9a3412d0e 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.cpp
@@ -53,7 +53,7 @@ namespace AZ
                 AzFramework::AssetCatalogEventBus::Handler::BusDisconnect();
             }
 
-            void MaterialThumbnail::ThumbnailRendered(QPixmap& thumbnailImage)
+            void MaterialThumbnail::ThumbnailRendered(const QPixmap& thumbnailImage)
             {
                 m_pixmap = thumbnailImage;
                 m_renderWait.release();
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.h
index 9a580d07ce..1349336245 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/MaterialThumbnail.h
@@ -33,7 +33,7 @@ namespace AZ
                 ~MaterialThumbnail() override;
 
                 //! AzToolsFramework::ThumbnailerRendererNotificationBus::Handler overrides...
-                void ThumbnailRendered(QPixmap& thumbnailImage) override;
+                void ThumbnailRendered(const QPixmap& thumbnailImage) override;
                 void ThumbnailFailedToRender() override;
 
             protected:
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.cpp
index 6fe490e9dc..e3eb7a3af6 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.cpp
@@ -53,7 +53,7 @@ namespace AZ
                 AzFramework::AssetCatalogEventBus::Handler::BusDisconnect();
             }
 
-            void ModelThumbnail::ThumbnailRendered(QPixmap& thumbnailImage)
+            void ModelThumbnail::ThumbnailRendered(const QPixmap& thumbnailImage)
             {
                 m_pixmap = thumbnailImage;
                 m_renderWait.release();
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.h
index 2925abe36e..5d9449e988 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ModelThumbnail.h
@@ -33,7 +33,7 @@ namespace AZ
                 ~ModelThumbnail() override;
 
                 //! AzToolsFramework::ThumbnailerRendererNotificationBus::Handler overrides...
-                void ThumbnailRendered(QPixmap& thumbnailImage) override;
+                void ThumbnailRendered(const QPixmap& thumbnailImage) override;
                 void ThumbnailFailedToRender() override;
 
             protected:
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.cpp b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.cpp
index 8293b33763..6d3d07faef 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.cpp
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.cpp
@@ -19,10 +19,11 @@ namespace AZ
     {
         namespace Thumbnails
         {
-            Data::AssetId GetAssetId(AzToolsFramework::Thumbnailer::SharedThumbnailKey key, const Data::AssetType& assetType)
+            Data::AssetId GetAssetId(
+                AzToolsFramework::Thumbnailer::SharedThumbnailKey key,
+                const Data::AssetType& assetType,
+                const Data::AssetId& defaultAssetId)
             {
-                static const Data::AssetId invalidAssetId;
-
                 // if it's a source thumbnail key, find first product with a matching asset type
                 auto sourceKey = azrtti_cast<const AzToolsFramework::AssetBrowser::SourceThumbnailKey*>(key.data());
                 if (sourceKey)
@@ -32,7 +33,7 @@ namespace AZ
                     AzToolsFramework::AssetSystemRequestBus::BroadcastResult(foundIt, &AzToolsFramework::AssetSystemRequestBus::Events::GetAssetsProducedBySourceUUID, sourceKey->GetSourceUuid(), productsAssetInfo);
                     if (!foundIt)
                     {
-                        return invalidAssetId;
+                        return defaultAssetId;
                     }
                     auto assetInfoIt = AZStd::find_if(productsAssetInfo.begin(), productsAssetInfo.end(),
                         [&assetType](const Data::AssetInfo& assetInfo)
@@ -41,7 +42,7 @@ namespace AZ
                         });
                     if (assetInfoIt == productsAssetInfo.end())
                     {
-                        return invalidAssetId;
+                        return defaultAssetId;
                     }
 
                     return assetInfoIt->m_assetId;
@@ -53,7 +54,7 @@ namespace AZ
                 {
                     return productKey->GetAssetId();
                 }
-                return invalidAssetId;
+                return defaultAssetId;
             }
 
 
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.h b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.h
index e4efcd6b49..a88a25c2b7 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.h
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/Source/Previewer/ThumbnailUtils.h
@@ -21,7 +21,10 @@ namespace AZ
         namespace Thumbnails
         {
             //! Get assetId by assetType that belongs to either source or product thumbnail key
-            Data::AssetId GetAssetId(AzToolsFramework::Thumbnailer::SharedThumbnailKey key, const Data::AssetType& assetType);
+            Data::AssetId GetAssetId(
+                AzToolsFramework::Thumbnailer::SharedThumbnailKey key,
+                const Data::AssetType& assetType,
+                const Data::AssetId& defaultAssetId = {});
 
             //! Word wrap function for previewer QLabel, since by default it does not break long words such as filenames, so manual word wrap needed
             QString WordWrap(const QString& string, int maxLength);
diff --git a/Gems/AtomLyIntegration/CommonFeatures/Code/atomlyintegration_commonfeatures_editor_files.cmake b/Gems/AtomLyIntegration/CommonFeatures/Code/atomlyintegration_commonfeatures_editor_files.cmake
index 32f1bd882e..7c7765d3af 100644
--- a/Gems/AtomLyIntegration/CommonFeatures/Code/atomlyintegration_commonfeatures_editor_files.cmake
+++ b/Gems/AtomLyIntegration/CommonFeatures/Code/atomlyintegration_commonfeatures_editor_files.cmake
@@ -7,6 +7,7 @@
 #
 
 set(FILES
+    Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentNotificationBus.h
     Include/AtomLyIntegration/CommonFeatures/Material/EditorMaterialSystemComponentRequestBus.h
     Include/AtomLyIntegration/CommonFeatures/ReflectionProbe/EditorReflectionProbeBus.h
     Source/Module.cpp