diff --git a/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabSystemScriptingHandler.cpp b/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabSystemScriptingHandler.cpp
index 93dfca3f13..d189ba6d3e 100644
--- a/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabSystemScriptingHandler.cpp
+++ b/Code/Framework/AzToolsFramework/AzToolsFramework/Prefab/PrefabSystemScriptingHandler.cpp
@@ -10,6 +10,7 @@
 #include <AzCore/Component/ComponentApplicationBus.h>
 #include <AzCore/Component/Entity.h>
 #include <AzCore/RTTI/BehaviorContext.h>
+#include <AzCore/Utils/TypeHash.h>
 #include <AzToolsFramework/ToolsComponents/EditorLockComponent.h>
 #include <AzToolsFramework/ToolsComponents/EditorVisibilityComponent.h>
 #include <Prefab/PrefabSystemComponentInterface.h>
@@ -73,12 +74,24 @@ namespace AzToolsFramework::Prefab
         AzToolsFramework::ToolsApplicationRequestBus::BroadcastResult(result, &AzToolsFramework::ToolsApplicationRequestBus::Events::FindCommonRootInactive,
             entities, commonRoot, &topLevelEntities);
 
+
         auto containerEntity = AZStd::make_unique<AZ::Entity>();
-        containerEntity->CreateComponent<Components::TransformComponent>();
+
         containerEntity->CreateComponent<Components::EditorLockComponent>();
         containerEntity->CreateComponent<Components::EditorVisibilityComponent>();
         containerEntity->CreateComponent<Prefab::EditorPrefabComponent>();
 
+        {
+            auto transformComponent = containerEntity->CreateComponent<Components::TransformComponent>();
+            // Because procedural prefabs need to be deterministic we need to set the component ID to something unique and non-random
+            // The prefab that references the proc prefab will store a patch that references the transform component by it's component ID
+            // If this ID is not stable, the proc prefab will lose its position, parenting, etc data next time it is regenerated
+            auto hash = TypeHash64(reinterpret_cast<const uint8_t*>(filePath.data()), filePath.length(), AZ::HashValue64{0});
+
+            transformComponent->SetId(static_cast<AZ::ComponentId>(hash));
+
+        }
+
         for (AZ::Entity* entity : topLevelEntities)
         {
             AzToolsFramework::Components::TransformComponent* transformComponent =
@@ -92,7 +105,7 @@ namespace AzToolsFramework::Prefab
 
         auto prefab = m_prefabSystemComponentInterface->CreatePrefab(
             entities, {}, AZ::IO::PathView(AZStd::string_view(filePath)), AZStd::move(containerEntity));
-        
+
         if (!prefab)
         {
             AZ_Error("PrefabSystemComponenent", false, "Failed to create prefab %s", filePath.c_str());
diff --git a/Code/Framework/AzToolsFramework/Tests/Prefab/PrefabScriptingTests.cpp b/Code/Framework/AzToolsFramework/Tests/Prefab/PrefabScriptingTests.cpp
index 7e61c50629..999f3e8c26 100644
--- a/Code/Framework/AzToolsFramework/Tests/Prefab/PrefabScriptingTests.cpp
+++ b/Code/Framework/AzToolsFramework/Tests/Prefab/PrefabScriptingTests.cpp
@@ -48,11 +48,45 @@ namespace UnitTest
         }
     };
 
+    TEST_F(PrefabScriptingTest, CreatePrefabTemplate_GeneratesContainerWithStableTransformComponentId)
+    {
+        AZ::EntityId entityId;
+        AzToolsFramework::EntityUtilityBus::BroadcastResult(entityId, &AzToolsFramework::EntityUtilityBus::Events::CreateEditorReadyEntity, "test");
+        TemplateId templateId1;
+        PrefabSystemScriptingBus::BroadcastResult(templateId1, &PrefabSystemScriptingBus::Events::CreatePrefabTemplate, AZStd::vector{ entityId }, "test.prefab");
+
+        auto prefabSystemComponentInterface = AZ::Interface<PrefabSystemComponentInterface>::Get();
+
+        auto instance1 = prefabSystemComponentInterface->InstantiatePrefab(templateId1);
+
+        // Clear all templates to reset the system
+        prefabSystemComponentInterface->RemoveAllTemplates();
+
+        TemplateId templateId2;
+        PrefabSystemScriptingBus::BroadcastResult(templateId2, &PrefabSystemScriptingBus::Events::CreatePrefabTemplate, AZStd::vector{ entityId }, "test.prefab");
+
+        auto instance2 = prefabSystemComponentInterface->InstantiatePrefab(templateId2);
+
+        auto referenceWrapper1 = instance1->GetContainerEntity();
+        auto referenceWrapper2 = instance2->GetContainerEntity();
+
+        ASSERT_TRUE(referenceWrapper1);
+        ASSERT_TRUE(referenceWrapper2);
+
+        auto transformComponent1 = referenceWrapper1->get().FindComponent<AzToolsFramework::Components::TransformComponent>();
+        auto transformComponent2 = referenceWrapper2->get().FindComponent<AzToolsFramework::Components::TransformComponent>();
+
+        ASSERT_NE(transformComponent1, nullptr);
+        ASSERT_NE(transformComponent2, nullptr);
+
+        ASSERT_EQ(transformComponent1->GetId(), transformComponent2->GetId());
+    }
+
     TEST_F(PrefabScriptingTest, PrefabScripting_CreatePrefab)
     {
         AZ::ScriptContext sc;
         auto behaviorContext = AZ::Interface<AZ::ComponentApplicationRequests>::Get()->GetBehaviorContext();
-        
+
         sc.BindTo(behaviorContext);
         sc.Execute(R"LUA(
             my_id = EntityUtilityBus.Broadcast.CreateEditorReadyEntity("test")
@@ -76,7 +110,7 @@ namespace UnitTest
     {
         AZ::ScriptContext sc;
         auto behaviorContext = AZ::Interface<AZ::ComponentApplicationRequests>::Get()->GetBehaviorContext();
-        
+
         sc.BindTo(behaviorContext);
         sc.Execute(R"LUA(
             my_id = EntityUtilityBus.Broadcast.CreateEditorReadyEntity("test")
@@ -99,7 +133,7 @@ namespace UnitTest
     {
         AZ::ScriptContext sc;
         auto behaviorContext = AZ::Interface<AZ::ComponentApplicationRequests>::Get()->GetBehaviorContext();
-        
+
         sc.BindTo(behaviorContext);
         AZ_TEST_START_TRACE_SUPPRESSION;
         sc.Execute(R"LUA(
@@ -119,7 +153,7 @@ namespace UnitTest
     {
         AZ::ScriptContext sc;
         auto behaviorContext = AZ::Interface<AZ::ComponentApplicationRequests>::Get()->GetBehaviorContext();
-        
+
         sc.BindTo(behaviorContext);
         sc.Execute(R"LUA(
             my_id = EntityUtilityBus.Broadcast.CreateEditorReadyEntity("test")
@@ -132,7 +166,7 @@ namespace UnitTest
                 g_globalPrefabString = my_result:GetValue()
             end
             )LUA");
-        
+
         auto prefabSystemComponentInterface = AZ::Interface<PrefabSystemComponentInterface>::Get();
         prefabSystemComponentInterface->RemoveAllTemplates();
 
@@ -169,5 +203,5 @@ namespace UnitTest
 
         g_globalPrefabString.set_capacity(0); // Free all memory
     }
-    
+
 }