diff --git a/core/api/test-current.txt b/core/api/test-current.txt
index 39f2737..a3cd3dc 100644
--- a/core/api/test-current.txt
+++ b/core/api/test-current.txt
@@ -2,6 +2,7 @@
 package android {
 
   public static final class Manifest.permission {
+    field @FlaggedApi("com.android.server.accessibility.motion_event_observing") public static final String ACCESSIBILITY_MOTION_EVENT_OBSERVING = "android.permission.ACCESSIBILITY_MOTION_EVENT_OBSERVING";
     field public static final String ACCESS_NOTIFICATIONS = "android.permission.ACCESS_NOTIFICATIONS";
     field public static final String ACTIVITY_EMBEDDING = "android.permission.ACTIVITY_EMBEDDING";
     field public static final String ADJUST_RUNTIME_PERMISSIONS_POLICY = "android.permission.ADJUST_RUNTIME_PERMISSIONS_POLICY";
@@ -99,6 +100,8 @@
 
   public class AccessibilityServiceInfo implements android.os.Parcelable {
     method @NonNull public android.content.ComponentName getComponentName();
+    method @FlaggedApi("android.view.accessibility.motion_event_observing") public int getObservedMotionEventSources();
+    method @FlaggedApi("android.view.accessibility.motion_event_observing") public void setObservedMotionEventSources(int);
   }
 
 }
diff --git a/core/java/android/accessibilityservice/AccessibilityServiceInfo.java b/core/java/android/accessibilityservice/AccessibilityServiceInfo.java
index 8ad6ea2..fc342fa 100644
--- a/core/java/android/accessibilityservice/AccessibilityServiceInfo.java
+++ b/core/java/android/accessibilityservice/AccessibilityServiceInfo.java
@@ -20,6 +20,7 @@
 import static android.accessibilityservice.util.AccessibilityUtils.loadSafeAnimatedImage;
 import static android.content.pm.PackageManager.FEATURE_FINGERPRINT;
 
+import android.annotation.FlaggedApi;
 import android.annotation.IntDef;
 import android.annotation.IntRange;
 import android.annotation.NonNull;
@@ -53,6 +54,7 @@
 import android.view.View;
 import android.view.accessibility.AccessibilityEvent;
 import android.view.accessibility.AccessibilityNodeInfo;
+import android.view.accessibility.Flags;
 
 import com.android.internal.R;
 import com.android.internal.compat.IPlatformCompat;
@@ -630,7 +632,8 @@
             InputDevice.SOURCE_TOUCH_NAVIGATION,
             InputDevice.SOURCE_ROTARY_ENCODER,
             InputDevice.SOURCE_JOYSTICK,
-            InputDevice.SOURCE_SENSOR
+            InputDevice.SOURCE_SENSOR,
+            InputDevice.SOURCE_TOUCHSCREEN
     })
     @Retention(RetentionPolicy.SOURCE)
     public @interface MotionEventSources {}
@@ -642,6 +645,8 @@
     @MotionEventSources
     private int mMotionEventSources = 0;
 
+    private int mObservedMotionEventSources = 0;
+
     /**
      * Creates a new instance.
      */
@@ -817,6 +822,9 @@
         mInteractiveUiTimeout = other.mInteractiveUiTimeout;
         flags = other.flags;
         mMotionEventSources = other.mMotionEventSources;
+        if (Flags.motionEventObserving()) {
+            setObservedMotionEventSources(other.mObservedMotionEventSources);
+        }
         // NOTE: Ensure that only properties that are safe to be modified by the service itself
         // are included here (regardless of hidden setters, etc.).
     }
@@ -1024,16 +1032,75 @@
      */
     public void setMotionEventSources(@MotionEventSources int motionEventSources) {
         mMotionEventSources = motionEventSources;
+        mObservedMotionEventSources = 0;
+    }
+
+    /**
+     * Sets the bit mask of {@link android.view.InputDevice} sources that the accessibility service
+     * wants to observe generic {@link android.view.MotionEvent}s from if it has already requested
+     * to listen to them using {@link #setMotionEventSources(int)}. Events from these sources will
+     * be sent to the rest of the input pipeline without being consumed by accessibility services.
+     * This service will still be able to see them.
+     *
+     * <p><strong>Note:</strong> you will need to call this function every time you call {@link
+     * #setMotionEventSources(int)}. Calling {@link #setMotionEventSources(int)} clears the list of
+     * observed motion event sources for this service.
+     *
+     * <p><strong>Note:</strong> {@link android.view.InputDevice} sources contain source class bits
+     * that complicate bitwise flag removal operations. To remove a specific source you should
+     * rebuild the entire value using bitwise OR operations on the individual source constants.
+     *
+     * <p>Including an {@link android.view.InputDevice} source that does not send {@link
+     * android.view.MotionEvent}s is effectively a no-op for that source, since you will not receive
+     * any events from that source.
+     *
+     * <p><strong>Note:</strong> Calling this function with a source that has not been listened to
+     * using {@link #setMotionEventSources(int)} will throw an exception.
+     *
+     * @see AccessibilityService#onMotionEvent
+     * @see #MotionEventSources
+     * @see #setMotionEventSources(int)
+     * @hide
+     */
+    @FlaggedApi(Flags.FLAG_MOTION_EVENT_OBSERVING)
+    @TestApi
+    public void setObservedMotionEventSources(int observedMotionEventSources) {
+        // Confirm that any sources requested here have already been requested for listening.
+        if ((observedMotionEventSources & ~mMotionEventSources) != 0) {
+            String message =
+                    String.format(
+                            "Requested motion event sources for listening = 0x%x but requested"
+                                    + " motion event sources for observing = 0x%x.",
+                            mMotionEventSources, observedMotionEventSources);
+            throw new IllegalArgumentException(message);
+        }
+        mObservedMotionEventSources = observedMotionEventSources;
+    }
+
+    /**
+     * Returns the bit mask of {@link android.view.InputDevice} sources that the accessibility
+     * service wants to observe generic {@link android.view.MotionEvent}s from if it has already
+     * requested to listen to them using {@link #setMotionEventSources(int)}. Events from these
+     * sources will be sent to the rest of the input pipeline without being consumed by
+     * accessibility services. This service will still be able to see them.
+     *
+     * @hide
+     */
+    @FlaggedApi(Flags.FLAG_MOTION_EVENT_OBSERVING)
+    @MotionEventSources
+    @TestApi
+    public int getObservedMotionEventSources() {
+        return mObservedMotionEventSources;
     }
 
     /**
      * The localized summary of the accessibility service.
-     * <p>
-     *    <strong>Statically set from
-     *    {@link AccessibilityService#SERVICE_META_DATA meta-data}.</strong>
-     * </p>
-     * @return The localized summary if available, and {@code null} if a summary
-     * has not been provided.
+     *
+     * <p><strong>Statically set from {@link AccessibilityService#SERVICE_META_DATA
+     * meta-data}.</strong>
+     *
+     * @return The localized summary if available, and {@code null} if a summary has not been
+     *     provided.
      */
     public CharSequence loadSummary(PackageManager packageManager) {
         if (mSummaryResId == 0) {
@@ -1260,6 +1327,7 @@
         parcel.writeString(mTileServiceName);
         parcel.writeInt(mIntroResId);
         parcel.writeInt(mMotionEventSources);
+        parcel.writeInt(mObservedMotionEventSources);
     }
 
     private void initFromParcel(Parcel parcel) {
@@ -1285,6 +1353,8 @@
         mTileServiceName = parcel.readString();
         mIntroResId = parcel.readInt();
         mMotionEventSources = parcel.readInt();
+        // use the setter here because it throws an exception for invalid values.
+        setObservedMotionEventSources(parcel.readInt());
     }
 
     @Override
diff --git a/core/java/android/view/accessibility/flags/accessibility_flags.aconfig b/core/java/android/view/accessibility/flags/accessibility_flags.aconfig
index e057660..0cc19fb 100644
--- a/core/java/android/view/accessibility/flags/accessibility_flags.aconfig
+++ b/core/java/android/view/accessibility/flags/accessibility_flags.aconfig
@@ -59,6 +59,13 @@
 }
 
 flag {
+    name: "motion_event_observing"
+    namespace: "accessibility"
+    description: "Allows accessibility services to intercept but not consume motion events from specified sources."
+    bug: "297595990"
+}
+
+flag {
     namespace: "accessibility"
     name: "granular_scrolling"
     description: "Allow the use of granular scrolling. This allows scrollable nodes to scroll by increments other than a full screen"
diff --git a/core/res/AndroidManifest.xml b/core/res/AndroidManifest.xml
index dd93586..c6a241f 100644
--- a/core/res/AndroidManifest.xml
+++ b/core/res/AndroidManifest.xml
@@ -4806,6 +4806,13 @@
     <permission android:name="android.permission.CHANGE_ACCESSIBILITY_VOLUME"
                 android:protectionLevel="signature" />
 
+    <!-- @FlaggedApi("com.android.server.accessibility.motion_event_observing")
+    @hide
+    @TestApi
+    Allows an accessibility service to observe motion events without consuming them. -->
+    <permission android:name="android.permission.ACCESSIBILITY_MOTION_EVENT_OBSERVING"
+                android:protectionLevel="signature" />
+
     <!-- @hide Allows an application to collect frame statistics -->
     <permission android:name="android.permission.FRAME_STATS"
          android:protectionLevel="signature" />
diff --git a/packages/Shell/AndroidManifest.xml b/packages/Shell/AndroidManifest.xml
index d12d9d6..bacab0f 100644
--- a/packages/Shell/AndroidManifest.xml
+++ b/packages/Shell/AndroidManifest.xml
@@ -879,6 +879,9 @@
 
     <uses-permission android:name="android.permission.GET_BINDING_UID_IMPORTANCE" />
 
+    <!-- Permissions required for CTS test - CtsAccessibilityServiceTestCases-->
+    <uses-permission android:name="android.permission.ACCESSIBILITY_MOTION_EVENT_OBSERVING" />
+
     <application
         android:label="@string/app_label"
         android:theme="@android:style/Theme.DeviceDefault.DayNight"
diff --git a/services/accessibility/java/com/android/server/accessibility/AbstractAccessibilityServiceConnection.java b/services/accessibility/java/com/android/server/accessibility/AbstractAccessibilityServiceConnection.java
index 0696807..97d36d4 100644
--- a/services/accessibility/java/com/android/server/accessibility/AbstractAccessibilityServiceConnection.java
+++ b/services/accessibility/java/com/android/server/accessibility/AbstractAccessibilityServiceConnection.java
@@ -209,6 +209,7 @@
     final ComponentName mComponentName;
 
     int mGenericMotionEventSources;
+    int mObservedMotionEventSources;
 
     // the events pending events to be dispatched to this service
     final SparseArray<AccessibilityEvent> mPendingEvents = new SparseArray<>();
@@ -397,6 +398,19 @@
         mNotificationTimeout = info.notificationTimeout;
         mIsDefault = (info.flags & DEFAULT) != 0;
         mGenericMotionEventSources = info.getMotionEventSources();
+        if (android.view.accessibility.Flags.motionEventObserving()) {
+            if (mContext.checkCallingOrSelfPermission(
+                            android.Manifest.permission.ACCESSIBILITY_MOTION_EVENT_OBSERVING)
+                    == PackageManager.PERMISSION_GRANTED) {
+                mObservedMotionEventSources = info.getObservedMotionEventSources();
+            } else {
+                Slog.e(
+                        LOG_TAG,
+                        "Observing motion events requires"
+                            + " android.Manifest.permission.ACCESSIBILITY_MOTION_EVENT_OBSERVING.");
+                mObservedMotionEventSources = 0;
+            }
+        }
 
         if (supportsFlagForNotImportantViews(info)) {
             if ((info.flags & AccessibilityServiceInfo.FLAG_INCLUDE_NOT_IMPORTANT_VIEWS) != 0) {
@@ -1599,7 +1613,7 @@
             final int displayId = displays[i].getDisplayId();
             onDisplayRemoved(displayId);
         }
-        if (Flags.cleanupA11yOverlays()) {
+        if (com.android.server.accessibility.Flags.cleanupA11yOverlays()) {
             detachAllOverlays();
         }
     }
@@ -1919,6 +1933,7 @@
         return (mGenericMotionEventSources & eventSourceWithoutClass) != 0;
     }
 
+
     /**
      * Called by the invocation handler to notify the service that the
      * state of magnification has changed.
diff --git a/services/accessibility/java/com/android/server/accessibility/AccessibilityInputFilter.java b/services/accessibility/java/com/android/server/accessibility/AccessibilityInputFilter.java
index 6cac6a4..9ddc35a 100644
--- a/services/accessibility/java/com/android/server/accessibility/AccessibilityInputFilter.java
+++ b/services/accessibility/java/com/android/server/accessibility/AccessibilityInputFilter.java
@@ -198,6 +198,7 @@
     // State tracking for generic MotionEvents is display-agnostic so we only need one.
     private GenericMotionEventStreamState mGenericMotionEventStreamState;
     private int mCombinedGenericMotionEventSources = 0;
+    private int mCombinedMotionEventObservedSources = 0;
 
     private EventStreamState mKeyboardStreamState;
 
@@ -525,16 +526,33 @@
         }
 
         if ((mEnabledFeatures & FLAG_FEATURE_INTERCEPT_GENERIC_MOTION_EVENTS) != 0) {
-            addFirstEventHandler(displayId, new BaseEventStreamTransformation() {
-                @Override
-                public void onMotionEvent(MotionEvent event, MotionEvent rawEvent,
-                        int policyFlags) {
-                    if (!anyServiceWantsGenericMotionEvent(rawEvent)
-                            || !mAms.sendMotionEventToListeningServices(rawEvent)) {
-                        super.onMotionEvent(event, rawEvent, policyFlags);
-                    }
-                }
-            });
+            addFirstEventHandler(
+                    displayId,
+                    new BaseEventStreamTransformation() {
+                        @Override
+                        public void onMotionEvent(
+                                MotionEvent event, MotionEvent rawEvent, int policyFlags) {
+                            boolean passAlongEvent = true;
+                            if (anyServiceWantsGenericMotionEvent(event)) {
+                                // Some service wants this event, so try to deliver it to at least
+                                // one service.
+                                if (mAms.sendMotionEventToListeningServices(event)) {
+                                    // A service accepted this event, so prevent it from passing
+                                    // down the stream by default.
+                                    passAlongEvent = false;
+                                }
+                                // However, if a service is observing these events instead of
+                                // consuming them then ensure
+                                // it is always passed along to the next stage of the event stream.
+                                if (anyServiceWantsToObserveMotionEvent(event)) {
+                                    passAlongEvent = true;
+                                }
+                            }
+                            if (passAlongEvent) {
+                                super.onMotionEvent(event, rawEvent, policyFlags);
+                            }
+                        }
+                    });
         }
 
         if ((mEnabledFeatures & FLAG_FEATURE_CONTROL_SCREEN_MAGNIFIER) != 0
@@ -542,15 +560,14 @@
                 || ((mEnabledFeatures & FLAG_FEATURE_MAGNIFICATION_TWO_FINGER_TRIPLE_TAP) != 0)
                 || ((mEnabledFeatures & FLAG_FEATURE_TRIGGERED_SCREEN_MAGNIFIER) != 0)) {
             final MagnificationGestureHandler magnificationGestureHandler =
-                    createMagnificationGestureHandler(displayId,
-                            displayContext);
+                    createMagnificationGestureHandler(displayId, displayContext);
             addFirstEventHandler(displayId, magnificationGestureHandler);
             mMagnificationGestureHandler.put(displayId, magnificationGestureHandler);
         }
 
         if ((mEnabledFeatures & FLAG_FEATURE_INJECT_MOTION_EVENTS) != 0) {
-            MotionEventInjector injector = new MotionEventInjector(
-                    mContext.getMainLooper(), mAms.getTraceManager());
+            MotionEventInjector injector =
+                    new MotionEventInjector(mContext.getMainLooper(), mAms.getTraceManager());
             addFirstEventHandler(displayId, injector);
             mMotionEventInjectors.put(displayId, injector);
         }
@@ -923,6 +940,20 @@
         }
     }
 
+    private boolean anyServiceWantsToObserveMotionEvent(MotionEvent event) {
+        // Disable SOURCE_TOUCHSCREEN generic event interception if any service is performing
+        // touch exploration.
+        if (event.isFromSource(InputDevice.SOURCE_TOUCHSCREEN)
+                && (mEnabledFeatures & FLAG_FEATURE_TOUCH_EXPLORATION) != 0) {
+            return false;
+        }
+        final int eventSourceWithoutClass = event.getSource() & ~InputDevice.SOURCE_CLASS_MASK;
+        return (mCombinedGenericMotionEventSources
+                        & mCombinedMotionEventObservedSources
+                        & eventSourceWithoutClass)
+                != 0;
+    }
+
     private boolean anyServiceWantsGenericMotionEvent(MotionEvent event) {
         // Disable SOURCE_TOUCHSCREEN generic event interception if any service is performing
         // touch exploration.
@@ -938,6 +969,10 @@
         mCombinedGenericMotionEventSources = sources;
     }
 
+    public void setCombinedMotionEventObservedSources(int sources) {
+        mCombinedMotionEventObservedSources = sources;
+    }
+
     /**
      * Keeps state of streams of events from all keyboard devices.
      */
diff --git a/services/accessibility/java/com/android/server/accessibility/AccessibilityManagerService.java b/services/accessibility/java/com/android/server/accessibility/AccessibilityManagerService.java
index 440e996..edb41639 100644
--- a/services/accessibility/java/com/android/server/accessibility/AccessibilityManagerService.java
+++ b/services/accessibility/java/com/android/server/accessibility/AccessibilityManagerService.java
@@ -2825,8 +2825,10 @@
                 flags |= AccessibilityInputFilter.FLAG_FEATURE_INJECT_MOTION_EVENTS;
             }
             int combinedGenericMotionEventSources = 0;
+            int combinedMotionEventObservedSources = 0;
             for (AccessibilityServiceConnection connection : userState.mBoundServices) {
                 combinedGenericMotionEventSources |= connection.mGenericMotionEventSources;
+                combinedMotionEventObservedSources |= connection.mObservedMotionEventSources;
             }
             if (combinedGenericMotionEventSources != 0) {
                 flags |= AccessibilityInputFilter.FLAG_FEATURE_INTERCEPT_GENERIC_MOTION_EVENTS;
@@ -2845,6 +2847,8 @@
                 mInputFilter.setUserAndEnabledFeatures(userState.mUserId, flags);
                 mInputFilter.setCombinedGenericMotionEventSources(
                         combinedGenericMotionEventSources);
+                mInputFilter.setCombinedMotionEventObservedSources(
+                        combinedMotionEventObservedSources);
             } else {
                 if (mHasInputFilter) {
                     mHasInputFilter = false;