diff --git a/Gems/Terrain/Code/Tests/SurfaceMaterialsListTest.cpp b/Gems/Terrain/Code/Tests/SurfaceMaterialsListTest.cpp
new file mode 100644
index 0000000000..fb70b1366f
--- /dev/null
+++ b/Gems/Terrain/Code/Tests/SurfaceMaterialsListTest.cpp
@@ -0,0 +1,73 @@
+/*
+ * 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
+ *
+ */
+
+#include <AzTest/AzTest.h>
+#include <AzCore/Component/ComponentApplication.h>
+#include <TerrainRenderer/Components/TerrainSurfaceMaterialsListComponent.h>
+#include <MockAxisAlignedBoxShapeComponent.h>
+#include <Terrain/MockTerrainAreaMaterialRequestBus.h>
+
+using ::testing::NiceMock;
+using ::testing::AtLeast;
+using ::testing::_;
+
+namespace UnitTest
+{
+    class TerrainSurfaceMaterialsListTest : public ::testing::Test
+    {
+    protected:
+        AZ::ComponentApplication m_app;
+
+        void SetUp() override
+        {
+            AZ::ComponentApplication::Descriptor appDesc;
+            appDesc.m_memoryBlocksByteSize = 20 * 1024 * 1024;
+            appDesc.m_recordingMode = AZ::Debug::AllocationRecords::RECORD_NO_RECORDS;
+            appDesc.m_stackRecordLevels = 20;
+
+            m_app.Create(appDesc);
+        }
+
+        AZStd::unique_ptr<AZ::Entity> CreateEntityWithShapeComponents()
+        {
+            auto entity = AZStd::make_unique<AZ::Entity>();
+            entity->Init();
+
+            auto shapeComponent = entity->CreateComponent<UnitTest::MockAxisAlignedBoxShapeComponent>();
+            m_app.RegisterComponentDescriptor(shapeComponent->CreateDescriptor());
+
+            return entity;
+        }
+
+        Terrain::TerrainSurfaceMaterialsListComponent* AddSurfaceMaterialListComponent(AZ::Entity* entity)
+        {
+            auto surfaceMaterialsListComponent = entity->CreateComponent<Terrain::TerrainSurfaceMaterialsListComponent>();
+            m_app.RegisterComponentDescriptor(surfaceMaterialsListComponent->CreateDescriptor());
+
+            return surfaceMaterialsListComponent;
+        }
+
+        void TearDown() override
+        {
+            m_app.Destroy();
+        }
+    };
+
+    TEST_F(TerrainSurfaceMaterialsListTest, SurfaceGradientListActivatesSuccessfully)
+    {
+        auto entity = CreateEntityWithShapeComponents();
+
+        AddSurfaceMaterialListComponent(entity.get());
+
+        entity->Activate();
+
+        EXPECT_EQ(entity->GetState(), AZ::Entity::State::Active);
+                
+        entity.reset();
+    }
+} // namespace UnitTest
diff --git a/Gems/Terrain/Code/terrain_tests_files.cmake b/Gems/Terrain/Code/terrain_tests_files.cmake
index 3ce1d05003..793bc01ac5 100644
--- a/Gems/Terrain/Code/terrain_tests_files.cmake
+++ b/Gems/Terrain/Code/terrain_tests_files.cmake
@@ -10,5 +10,6 @@ set(FILES
     Tests/TerrainTest.cpp
     Tests/TerrainSystemTest.cpp
     Tests/LayerSpawnerTests.cpp
+    Tests/SurfaceMaterialsListTest.cpp
     Tests/MockAxisAlignedBoxShapeComponent.h
 )