diff --git a/packages/react-components/react-tooltip/stories/src/Tooltip/TooltipWithOverflow.stories.tsx b/packages/react-components/react-tooltip/stories/src/Tooltip/TooltipWithOverflow.stories.tsx
new file mode 100644
index 00000000000000..af26b84dfc4cf3
--- /dev/null
+++ b/packages/react-components/react-tooltip/stories/src/Tooltip/TooltipWithOverflow.stories.tsx
@@ -0,0 +1,170 @@
+import * as React from 'react';
+import {
+  Tooltip,
+  Text,
+  tokens,
+  mergeClasses,
+  useIsomorphicLayoutEffect,
+  useFluent,
+  makeStyles,
+  Switch,
+} from '@fluentui/react-components';
+
+const useStyles = makeStyles({
+  wrapper: {
+    display: 'flex',
+    flexDirection: 'column',
+    padding: '20px',
+    gap: '30px',
+  },
+  overflowTextWrapper: {
+    border: `2px dashed ${tokens.colorNeutralStroke1}`,
+  },
+  reducedWrapper: {
+    maxWidth: '300px',
+    border: `2px dashed ${tokens.colorStatusDangerBorder2}`,
+  },
+  overflowContainer: {
+    overflow: 'hidden',
+    textOverflow: 'ellipsis',
+    whiteSpace: 'nowrap',
+  },
+  resizableArea: {
+    minWidth: '200px',
+    maxWidth: '800px',
+    border: `2px solid ${tokens.colorBrandBackground}`,
+    padding: '20px 10px 10px 10px',
+    position: 'relative',
+    resize: 'horizontal',
+    '::after': {
+      content: `'Resizable Area'`,
+      position: 'absolute',
+      padding: '1px 4px 1px',
+      top: '-2px',
+      left: '-2px',
+      fontFamily: 'monospace',
+      fontSize: '15px',
+      fontWeight: 900,
+      lineHeight: 1,
+      letterSpacing: '1px',
+      color: tokens.colorNeutralForegroundOnBrand,
+      backgroundColor: tokens.colorBrandBackground,
+    },
+  },
+});
+
+type Overflow = {
+  x: boolean;
+  y: boolean;
+};
+
+const useIsOverflow = (ref: React.RefObject<HTMLElement>, callback?: (overflow: Overflow) => void) => {
+  const { targetDocument } = useFluent();
+  const [overflow, setOverflow] = React.useState<Overflow>({ x: false, y: false });
+
+  const observer = React.useRef<ResizeObserver | null>(null);
+
+  useIsomorphicLayoutEffect(() => {
+    const { current } = ref;
+
+    if (!current || !targetDocument) {
+      return;
+    }
+
+    const trigger = () => {
+      const overflowX = current.scrollWidth > current.clientWidth;
+      const overflowY = current.scrollHeight > current.clientHeight;
+
+      const newOverflow = { x: overflowX, y: overflowY };
+
+      setOverflow(prev => {
+        if (prev.x !== newOverflow.x || prev.y !== newOverflow.y) {
+          if (callback) {
+            callback(newOverflow);
+          }
+
+          return newOverflow;
+        }
+        return prev;
+      });
+    };
+
+    if (targetDocument.defaultView && 'ResizeObserver' in targetDocument.defaultView) {
+      observer.current = new ResizeObserver(trigger);
+      observer.current.observe(current);
+    }
+
+    trigger();
+
+    return () => {
+      observer.current?.disconnect();
+    };
+  }, [ref, callback, targetDocument]);
+
+  return overflow;
+};
+
+export const WithOverflow = () => {
+  const styles = useStyles();
+  const parentRef = React.useRef<HTMLDivElement>(null);
+  const textRef = React.useRef<HTMLDivElement>(null);
+
+  const [isForced, setIsForced] = React.useState(false);
+  const [isVisibleFirst, setIsVisibleFirst] = React.useState(false);
+  const [isVisibleSecond, setIsVisibleSecond] = React.useState(false);
+
+  const { x: overflowXParent } = useIsOverflow(parentRef);
+  const { x: overflowXText } = useIsOverflow(textRef);
+
+  const handleForceOverflow = React.useCallback(ev => {
+    setIsForced(ev.currentTarget.checked);
+  }, []);
+
+  return (
+    <div className={mergeClasses(styles.wrapper)}>
+      <Switch label="Force text to overflow" onChange={handleForceOverflow} />
+      <div ref={parentRef} className={mergeClasses(styles.overflowContainer, styles.resizableArea)}>
+        <Tooltip
+          relationship="label"
+          withArrow
+          positioning={{
+            target: parentRef.current,
+          }}
+          visible={isVisibleFirst && overflowXParent}
+          onVisibleChange={(_, data) => {
+            setIsVisibleFirst(data.visible);
+          }}
+          content="Tooltip content"
+        >
+          <Text wrap={false} truncate>
+            If the parent element's content overflows, hovering here will show a tooltip (anchored to the parent
+            element).
+          </Text>
+        </Tooltip>
+      </div>
+      <div className={mergeClasses(styles.overflowTextWrapper, isForced && styles.reducedWrapper)}>
+        <Tooltip
+          relationship="label"
+          withArrow
+          visible={overflowXText && isVisibleSecond}
+          onVisibleChange={(_, data) => {
+            setIsVisibleSecond(data.visible);
+          }}
+          content="Tooltip content"
+        >
+          <Text wrap={false} truncate block ref={textRef}>
+            If the Tooltip's content overflows, hovering here will show a tooltip.
+          </Text>
+        </Tooltip>
+      </div>
+    </div>
+  );
+};
+
+WithOverflow.parameters = {
+  docs: {
+    description: {
+      story: 'Tooltip can be controlled and shown only based on overflow condition',
+    },
+  },
+};
diff --git a/packages/react-components/react-tooltip/stories/src/Tooltip/index.stories.tsx b/packages/react-components/react-tooltip/stories/src/Tooltip/index.stories.tsx
index b8b7caaa06bdd8..d422902b38e11c 100644
--- a/packages/react-components/react-tooltip/stories/src/Tooltip/index.stories.tsx
+++ b/packages/react-components/react-tooltip/stories/src/Tooltip/index.stories.tsx
@@ -13,6 +13,7 @@ export { Controlled } from './TooltipControlled.stories';
 export { Positioning } from './TooltipPositioning.stories';
 export { Target } from './TooltipTarget.stories';
 export { Icon } from './TooltipIcon.stories';
+export { WithOverflow } from './TooltipWithOverflow.stories';
 
 export default {
   title: 'Components/Tooltip',