diff --git a/package-lock.json b/package-lock.json
index 680749124f7..a8504a0d680 100644
--- a/package-lock.json
+++ b/package-lock.json
@@ -81,8 +81,8 @@
         "react-dom": "^18.3.1"
       },
       "devDependencies": {
-        "@primer/react": "38.9.0",
-        "@primer/styled-react": "1.0.2",
+        "@primer/react": "38.10.0",
+        "@primer/styled-react": "1.0.3",
         "@types/react": "^18.3.11",
         "@types/react-dom": "^18.3.0",
         "@vitejs/plugin-react": "^4.3.3",
@@ -95,8 +95,8 @@
       "name": "example-nextjs",
       "version": "0.0.0",
       "dependencies": {
-        "@primer/react": "38.9.0",
-        "@primer/styled-react": "1.0.2",
+        "@primer/react": "38.10.0",
+        "@primer/styled-react": "1.0.3",
         "next": "^16.1.5",
         "react": "^19.2.0",
         "react-dom": "^19.2.0",
@@ -138,8 +138,8 @@
       "version": "0.0.0",
       "dependencies": {
         "@primer/octicons-react": "^19.21.0",
-        "@primer/react": "38.9.0",
-        "@primer/styled-react": "1.0.2",
+        "@primer/react": "38.10.0",
+        "@primer/styled-react": "1.0.3",
         "clsx": "^2.1.1",
         "next": "^16.1.5",
         "react": "^19.2.0",
@@ -6482,9 +6482,9 @@
       }
     },
     "node_modules/@primer/behaviors": {
-      "version": "1.10.0",
-      "resolved": "https://registry.npmjs.org/@primer/behaviors/-/behaviors-1.10.0.tgz",
-      "integrity": "sha512-+GaAqCJuoYVf0Sy67mJfhw7k17nrCnfanI4H6NFEyToDC1ghrOC9Yl7627WTWpqGg+1lPhjF7OHF7VClLz52oA==",
+      "version": "1.10.2",
+      "resolved": "https://registry.npmjs.org/@primer/behaviors/-/behaviors-1.10.2.tgz",
+      "integrity": "sha512-93juWZbWg2DRhC11+7RT7hMpY1VD3lBosLmccqEZ65yrCHqkBCjI8Uj8wxs3y0U+wWE07LAoLHAPylyWbifg5A==",
       "license": "MIT"
     },
     "node_modules/@primer/css": {
@@ -27004,7 +27004,7 @@
     },
     "packages/react": {
       "name": "@primer/react",
-      "version": "38.9.0",
+      "version": "38.10.0",
       "license": "MIT",
       "dependencies": {
         "@github/mini-throttle": "^2.1.1",
@@ -27012,7 +27012,7 @@
         "@github/tab-container-element": "^4.8.2",
         "@lit-labs/react": "1.2.1",
         "@oddbird/popover-polyfill": "^0.5.2",
-        "@primer/behaviors": "^1.10.0",
+        "@primer/behaviors": "^1.10.2",
         "@primer/live-region-element": "^0.7.1",
         "@primer/octicons-react": "^19.21.0",
         "@primer/primitives": "10.x || 11.x",
@@ -27374,7 +27374,7 @@
     },
     "packages/styled-react": {
       "name": "@primer/styled-react",
-      "version": "1.0.2",
+      "version": "1.0.3",
       "dependencies": {
         "@styled-system/css": "^5.1.5",
         "@styled-system/props": "^5.1.5",
@@ -27388,7 +27388,7 @@
         "@babel/preset-react": "^7.28.5",
         "@babel/preset-typescript": "^7.28.5",
         "@primer/primitives": "10.x || 11.x",
-        "@primer/react": "^38.4.0",
+        "@primer/react": "^38.10.0",
         "@rollup/plugin-babel": "^6.1.0",
         "@storybook/react-vite": "^10.1.11",
         "@types/react": "18.3.11",
diff --git a/packages/react/package.json b/packages/react/package.json
index b0961635f67..67fcd5e655e 100644
--- a/packages/react/package.json
+++ b/packages/react/package.json
@@ -79,7 +79,7 @@
     "@github/tab-container-element": "^4.8.2",
     "@lit-labs/react": "1.2.1",
     "@oddbird/popover-polyfill": "^0.5.2",
-    "@primer/behaviors": "^1.10.0",
+    "@primer/behaviors": "^1.10.2",
     "@primer/live-region-element": "^0.7.1",
     "@primer/octicons-react": "^19.21.0",
     "@primer/primitives": "10.x || 11.x",
diff --git a/packages/react/src/ActionMenu/ActionMenu.examples.stories.tsx b/packages/react/src/ActionMenu/ActionMenu.examples.stories.tsx
index 36f6481dd40..7391258896d 100644
--- a/packages/react/src/ActionMenu/ActionMenu.examples.stories.tsx
+++ b/packages/react/src/ActionMenu/ActionMenu.examples.stories.tsx
@@ -1,5 +1,5 @@
-import React from 'react'
-import {ActionMenu, ActionList, Button, IconButton, FormControl, TextInput} from '../'
+import React, {useState, useCallback} from 'react'
+import {ActionMenu, ActionList, Button, IconButton, FormControl, TextInput, Dialog, Text} from '../'
 import {
   GearIcon,
   MilestoneIcon,
@@ -654,3 +654,104 @@ export const DynamicAnchorSides = () => {
     </>
   )
 }
+
+export const InsideDialog = () => {
+  const [isDialogOpen, setIsDialogOpen] = useState(false)
+
+  const onDialogClose = useCallback(() => setIsDialogOpen(false), [])
+  const openDialog = useCallback(() => setIsDialogOpen(true), [])
+
+  // Create scrollable content with multiple paragraphs
+  const scrollableContent = Array.from({length: 50}, (_, index) => (
+    <Text key={index} as="p" style={{marginBottom: '12px'}}>
+      This is paragraph {index + 1}. Lorem ipsum dolor sit amet, consectetur adipiscing elit. Sed do eiusmod tempor
+      incididunt ut labore et dolore magna aliqua. Ut enim ad minim veniam, quis nostrud exercitation ullamco laboris
+      nisi ut aliquip ex ea commodo consequat. Duis aute irure dolor in reprehenderit in voluptate velit esse cillum
+      dolore eu fugiat nulla pariatur.
+    </Text>
+  ))
+
+  return (
+    <div style={{padding: '20px'}}>
+      {/* Main scrollable content */}
+      <div>
+        <Text as="h1" style={{marginBottom: '16px'}}>
+          Main Page Content
+        </Text>
+
+        <Button onClick={openDialog} style={{margin: '16px 0'}}>
+          Open Dialog with ActionMenu
+        </Button>
+
+        {/* Show more content after the button to make it scrollable */}
+        {scrollableContent}
+      </div>
+
+      {/* Dialog containing ActionMenu */}
+      {isDialogOpen && (
+        <Dialog title="Dialog with ActionMenu" onClose={onDialogClose} width="medium">
+          <Text as="p" style={{marginBottom: '12px'}}>
+            This dialog contains an ActionMenu. The main page content behind is long enough to be scrollable.
+          </Text>
+
+          <Text as="h3" style={{marginBottom: '8px', fontWeight: '600'}}>
+            Document Settings
+          </Text>
+
+          <Text as="p" style={{marginBottom: '16px', color: '#656d76'}}>
+            Configure the document properties and sharing settings. These options allow you to control how the document
+            is displayed and who has access to it.
+          </Text>
+
+          <ActionMenu>
+            <ActionMenu.Button>Actions</ActionMenu.Button>
+            <ActionMenu.Overlay width="medium" displayInViewport={true}>
+              <ActionList>
+                <ActionList.Item onSelect={() => alert('Save clicked')}>
+                  Save
+                  <ActionList.TrailingVisual>⌘S</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Item onSelect={() => alert('Save as clicked')}>
+                  Save as...
+                  <ActionList.TrailingVisual>⌘⇧S</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Item onSelect={() => alert('Export clicked')}>
+                  Export
+                  <ActionList.TrailingVisual>⌘E</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Item onSelect={() => alert('Print clicked')}>
+                  Print
+                  <ActionList.TrailingVisual>⌘P</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Divider />
+                <ActionList.Item onSelect={() => alert('Copy clicked')}>
+                  Copy
+                  <ActionList.TrailingVisual>⌘C</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Item onSelect={() => alert('Paste clicked')}>
+                  Paste
+                  <ActionList.TrailingVisual>⌘V</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Item onSelect={() => alert('Duplicate clicked')}>
+                  Duplicate
+                  <ActionList.TrailingVisual>⌘D</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Divider />
+                <ActionList.Item onSelect={() => alert('Share clicked')}>
+                  Share
+                  <ActionList.TrailingVisual>⌘⇧U</ActionList.TrailingVisual>
+                </ActionList.Item>
+                <ActionList.Item onSelect={() => alert('Share via email clicked')}>Share via email</ActionList.Item>
+                <ActionList.Item onSelect={() => alert('Share via link clicked')}>Share via link</ActionList.Item>
+              </ActionList>
+            </ActionMenu.Overlay>
+          </ActionMenu>
+
+          <Text as="p" style={{marginTop: '12px'}}>
+            You can interact with the ActionMenu above while the main page content remains scrollable in the background.
+          </Text>
+        </Dialog>
+      )}
+    </div>
+  )
+}
diff --git a/packages/react/src/ActionMenu/ActionMenu.module.css b/packages/react/src/ActionMenu/ActionMenu.module.css
index 4c9b063d239..a6faaed8413 100644
--- a/packages/react/src/ActionMenu/ActionMenu.module.css
+++ b/packages/react/src/ActionMenu/ActionMenu.module.css
@@ -1,4 +1,7 @@
 .ActionMenuContainer {
+  /* add default max height */
+  max-height: 100vh;
+
   &:where([data-variant='fullscreen']) {
     padding-top: var(--base-size-36);
   }
diff --git a/packages/react/src/ActionMenu/ActionMenu.tsx b/packages/react/src/ActionMenu/ActionMenu.tsx
index 7e97ae4d673..3e1233ff55b 100644
--- a/packages/react/src/ActionMenu/ActionMenu.tsx
+++ b/packages/react/src/ActionMenu/ActionMenu.tsx
@@ -256,7 +256,7 @@ const defaultVariant: ResponsiveValue<'anchored', 'anchored' | 'fullscreen'> = {
 }
 
 type MenuOverlayProps = Partial<OverlayProps> &
-  Pick<AnchoredOverlayProps, 'align' | 'side' | 'variant'> & {
+  Pick<AnchoredOverlayProps, 'align' | 'side' | 'variant' | 'displayInViewport'> & {
     /**
      * Recommended: `ActionList`
      */
@@ -268,6 +268,7 @@ const Overlay: FCWithSlotMarker<React.PropsWithChildren<MenuOverlayProps>> = ({
   align = 'start',
   side,
   onPositionChange,
+  displayInViewport,
   'aria-labelledby': ariaLabelledby,
   variant = defaultVariant,
   ...overlayProps
@@ -331,6 +332,7 @@ const Overlay: FCWithSlotMarker<React.PropsWithChildren<MenuOverlayProps>> = ({
       focusZoneSettings={isNarrowFullscreen ? {disabled: true} : {focusOutBehavior: 'wrap'}}
       onPositionChange={onPositionChange}
       variant={variant}
+      displayInViewport={displayInViewport}
     >
       <div
         ref={containerRef}
diff --git a/packages/react/src/AnchoredOverlay/AnchoredOverlay.tsx b/packages/react/src/AnchoredOverlay/AnchoredOverlay.tsx
index c0cd18f64ef..f60070447b3 100644
--- a/packages/react/src/AnchoredOverlay/AnchoredOverlay.tsx
+++ b/packages/react/src/AnchoredOverlay/AnchoredOverlay.tsx
@@ -121,7 +121,7 @@ interface AnchoredOverlayBaseProps extends Pick<OverlayProps, 'height' | 'width'
 
 export type AnchoredOverlayProps = AnchoredOverlayBaseProps &
   (AnchoredOverlayPropsWithAnchor | AnchoredOverlayPropsWithoutAnchor) &
-  Partial<Pick<PositionSettings, 'align' | 'side' | 'anchorOffset' | 'alignmentOffset'>>
+  Partial<Pick<PositionSettings, 'align' | 'side' | 'anchorOffset' | 'alignmentOffset' | 'displayInViewport'>>
 
 const defaultVariant = {
   regular: 'anchored',
@@ -151,6 +151,7 @@ export const AnchoredOverlay: React.FC<React.PropsWithChildren<AnchoredOverlayPr
   align = 'start',
   alignmentOffset,
   anchorOffset,
+  displayInViewport,
   className,
   pinPosition,
   variant = defaultVariant,
@@ -206,6 +207,7 @@ export const AnchoredOverlay: React.FC<React.PropsWithChildren<AnchoredOverlayPr
       align,
       alignmentOffset,
       anchorOffset,
+      displayInViewport,
       onPositionChange: positionChange,
     },
     [overlayRef.current],