diff --git a/docs/content/Overlay.mdx b/docs/content/Overlay.mdx
index fc97fff6c14..34e4e8ba9fa 100644
--- a/docs/content/Overlay.mdx
+++ b/docs/content/Overlay.mdx
@@ -77,3 +77,4 @@ render(<Demo />)
 | onEscape        | `function`                        | `undefined` | Required. Function to call when user presses `Escape`. Typically this function sets the `Overlay` visibility state to `false`.                                                                                                                                                  |
 | width           | `'sm', 'md', 'lg', 'xl', 'auto'`  |   `auto`    | Sets the width of the `Overlay`, pick from our set list of widths, or pass `auto` to automatically set the width based on the content of the `Overlay`. `sm` corresponds to `256px`, `md` corresponds to `320px`, `lg` corresponds to `480px`, and `xl` corresponds to `640px`. |
 | height          | `'sm', 'md', 'auto'`              |   `auto`    | Sets the height of the `Overlay`, pick from our set list of heights, or pass `auto` to automatically set the height based on the content of the `Overlay`. `sm` corresponds to `480px` and `md` corresponds to `640px`.                                                         |
+| visibility      | `'visible', 'hidden'`             |  `visible`  | Sets the visibility of the `Overlay`.                                                                                                                                                                                                                                           |
diff --git a/src/ActionMenu.tsx b/src/ActionMenu.tsx
index 88b4b3066c8..3b77bb77889 100644
--- a/src/ActionMenu.tsx
+++ b/src/ActionMenu.tsx
@@ -75,7 +75,13 @@ const ActionMenuBase = ({
     [open]
   )
 
-  const {position} = useAnchoredPosition({anchorElementRef: anchorRef, floatingElementRef: overlayRef})
+  const {position} = useAnchoredPosition(
+    {
+      anchorElementRef: anchorRef,
+      floatingElementRef: overlayRef
+    },
+    [overlayRef.current]
+  )
 
   useFocusZone({containerRef: overlayRef, disabled: !open || state !== 'listFocus'}, [position])
   useFocusTrap({containerRef: overlayRef, disabled: !open || state !== 'listFocus'}, [position])
@@ -100,6 +106,7 @@ const ActionMenuBase = ({
           onClickOutside={onDismiss}
           onEscape={onDismiss}
           ref={updateOverlayRef}
+          visibility={position ? 'visible' : 'hidden'}
           {...position}
         >
           <List
diff --git a/src/DropdownMenu/DropdownMenu.tsx b/src/DropdownMenu/DropdownMenu.tsx
index d493786ef70..88b488a6c97 100644
--- a/src/DropdownMenu/DropdownMenu.tsx
+++ b/src/DropdownMenu/DropdownMenu.tsx
@@ -95,7 +95,13 @@ export function DropdownMenu({
     [open]
   )
 
-  const {position} = useAnchoredPosition({anchorElementRef: anchorRef, floatingElementRef: overlayRef})
+  const {position} = useAnchoredPosition(
+    {
+      anchorElementRef: anchorRef,
+      floatingElementRef: overlayRef
+    },
+    [overlayRef.current]
+  )
 
   useFocusZone({containerRef: overlayRef, disabled: !open || focusType !== 'list' || !position})
   useFocusTrap({containerRef: overlayRef, disabled: !open || focusType !== 'list' || !position})
@@ -147,6 +153,7 @@ export function DropdownMenu({
           onClickOutside={onDismiss}
           onEscape={onDismiss}
           ref={updateOverlayRef}
+          visibility={position ? 'visible' : 'hidden'}
           {...position}
         >
           <List {...listProps} role="listbox" renderItem={renderItemWithCallbacks} />
diff --git a/src/Overlay.tsx b/src/Overlay.tsx
index 3eb50a7154e..fa88c725153 100644
--- a/src/Overlay.tsx
+++ b/src/Overlay.tsx
@@ -10,6 +10,7 @@ import {useCombinedRefs} from './hooks/useCombinedRefs'
 type StyledOverlayProps = {
   width?: keyof typeof widthMap
   height?: keyof typeof heightMap
+  visibility?: 'visible' | 'hidden'
 }
 
 const heightMap = {
@@ -48,6 +49,7 @@ const StyledOverlay = styled.div<StyledOverlayProps & SystemCommonProps & System
       opacity: 1;
     }
   }
+  visibility: ${props => props.visibility || 'visible'};
   ${COMMON};
   ${POSITION};
   ${sx};
@@ -58,7 +60,8 @@ export type OverlayProps = {
   returnFocusRef: React.RefObject<HTMLElement>
   onClickOutside: (e: TouchOrMouseEvent) => void
   onEscape: (e: KeyboardEvent) => void
-} & Omit<ComponentProps<typeof StyledOverlay>, keyof SystemPositionProps>
+  visibility?: 'visible' | 'hidden'
+} & Omit<ComponentProps<typeof StyledOverlay>, 'visibility' | keyof SystemPositionProps>
 
 /**
  * An `Overlay` is a flexible floating surface, used to display transient content such as menus,
@@ -71,10 +74,11 @@ export type OverlayProps = {
  * @param onEscape Required. Function to call when user presses `Escape`. Typically this function sets the `Overlay` visibility state to `false`.
  * @param width Sets the width of the `Overlay`, pick from our set list of widths, or pass `auto` to automatically set the width based on the content of the `Overlay`. `sm` corresponds to `256px`, `md` corresponds to `320px`, `lg` corresponds to `480px`, and `xl` corresponds to `640px`.
  * @param height Sets the height of the `Overlay`, pick from our set list of heights, or pass `auto` to automatically set the height based on the content of the `Overlay`. `sm` corresponds to `480px` and `md` corresponds to `640px`.
+ * @param visibility Sets the visibility of the `Overlay`
  */
 const Overlay = React.forwardRef<HTMLDivElement, OverlayProps>(
   (
-    {onClickOutside, role = 'dialog', initialFocusRef, returnFocusRef, ignoreClickRefs, onEscape, ...rest},
+    {onClickOutside, role = 'dialog', initialFocusRef, returnFocusRef, ignoreClickRefs, onEscape, visibility, ...rest},
     forwardedRef
   ): ReactElement => {
     const overlayRef = useRef<HTMLDivElement>(null)
@@ -90,7 +94,14 @@ const Overlay = React.forwardRef<HTMLDivElement, OverlayProps>(
     })
     return (
       <Portal>
-        <StyledOverlay {...overlayProps} aria-modal="true" role={role} {...rest} ref={combinedRef} />
+        <StyledOverlay
+          {...overlayProps}
+          aria-modal="true"
+          role={role}
+          {...rest}
+          ref={combinedRef}
+          visibility={visibility}
+        />
       </Portal>
     )
   }
diff --git a/src/hooks/useAnchoredPosition.ts b/src/hooks/useAnchoredPosition.ts
index 1e5f6e6be43..7ba0a40a4fb 100644
--- a/src/hooks/useAnchoredPosition.ts
+++ b/src/hooks/useAnchoredPosition.ts
@@ -34,7 +34,7 @@ export function useAnchoredPosition(
       setPosition(undefined)
     }
     // eslint-disable-next-line react-hooks/exhaustive-deps
-  }, [floatingElementRef.current, anchorElementRef.current, ...dependencies])
+  }, [floatingElementRef, anchorElementRef, ...dependencies])
   return {
     floatingElementRef,
     anchorElementRef,
diff --git a/src/hooks/useCombinedRefs.ts b/src/hooks/useCombinedRefs.ts
index c5915b152c2..0fef707de7d 100644
--- a/src/hooks/useCombinedRefs.ts
+++ b/src/hooks/useCombinedRefs.ts
@@ -12,16 +12,27 @@ export function useCombinedRefs<T>(...refs: (ForwardedRef<T> | null | undefined)
   const combinedRef = useRef<T | null>(null)
 
   React.useEffect(() => {
-    for (const ref of refs) {
-      if (!ref) {
-        return
-      }
-      if (typeof ref === 'function') {
-        ref(combinedRef.current ?? null)
-      } else {
-        ref.current = combinedRef.current ?? null
+    function setRefs(current: T | null = null) {
+      for (const ref of refs) {
+        if (!ref) {
+          return
+        }
+        if (typeof ref === 'function') {
+          ref(current)
+        } else {
+          ref.current = current
+        }
       }
     }
+
+    setRefs(combinedRef.current)
+
+    return () => {
+      // ensure the refs get updated on unmount
+      // eslint-disable-next-line react-hooks/exhaustive-deps
+      setRefs(combinedRef.current)
+    }
+
     // eslint-disable-next-line react-hooks/exhaustive-deps
   }, [...refs, combinedRef.current])