diff --git a/packages/SystemUI/aconfig/systemui.aconfig b/packages/SystemUI/aconfig/systemui.aconfig
index 201aaed..22bfe90 100644
--- a/packages/SystemUI/aconfig/systemui.aconfig
+++ b/packages/SystemUI/aconfig/systemui.aconfig
@@ -1304,4 +1304,14 @@
    namespace: "systemui"
    description: "Adding haptic component infrastructure to sliders in Compose."
    bug: "341968766"
+}
+
+flag {
+  namespace: "systemui"
+  name: "settings_ext_register_content_observer_on_bg_thread"
+  description: "Register content observer in callback flow APIs on background thread in SettingsProxyExt."
+  bug: "355389014"
+  metadata {
+    purpose: PURPOSE_BUGFIX
+  }
 }
\ No newline at end of file
diff --git a/packages/SystemUI/multivalentTests/src/com/android/systemui/util/settings/SettingsProxyExtTest.kt b/packages/SystemUI/multivalentTests/src/com/android/systemui/util/settings/SettingsProxyExtTest.kt
new file mode 100644
index 0000000..e281894
--- /dev/null
+++ b/packages/SystemUI/multivalentTests/src/com/android/systemui/util/settings/SettingsProxyExtTest.kt
@@ -0,0 +1,165 @@
+/*
+ * Copyright (C) 2024 The Android Open Source Project
+ *
+ * Licensed under the Apache License, Version 2.0 (the "License");
+ * you may not use this file except in compliance with the License.
+ * You may obtain a copy of the License at
+ *
+ *      http://www.apache.org/licenses/LICENSE-2.0
+ *
+ * Unless required by applicable law or agreed to in writing, software
+ * distributed under the License is distributed on an "AS IS" BASIS,
+ * WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+ * See the License for the specific language governing permissions and
+ * limitations under the License.
+ */
+package com.android.systemui.util.settings
+
+import android.database.ContentObserver
+import android.platform.test.annotations.DisableFlags
+import android.platform.test.annotations.EnableFlags
+import androidx.test.ext.junit.runners.AndroidJUnit4
+import androidx.test.filters.SmallTest
+import com.android.systemui.Flags
+import com.android.systemui.SysuiTestCase
+import com.android.systemui.coroutines.collectLastValue
+import com.android.systemui.kosmos.testScope
+import com.android.systemui.testKosmos
+import com.android.systemui.util.settings.SettingsProxyExt.observerFlow
+import kotlinx.coroutines.ExperimentalCoroutinesApi
+import kotlinx.coroutines.Job
+import kotlinx.coroutines.test.runCurrent
+import kotlinx.coroutines.test.runTest
+import org.junit.Before
+import org.junit.Test
+import org.junit.runner.RunWith
+import org.mockito.Mock
+import org.mockito.MockitoAnnotations
+import org.mockito.kotlin.any
+import org.mockito.kotlin.times
+import org.mockito.kotlin.verify
+
+/** Tests for [SettingsProxyExt]. */
+@RunWith(AndroidJUnit4::class)
+@SmallTest
+@OptIn(ExperimentalCoroutinesApi::class)
+class SettingsProxyExtTest : SysuiTestCase() {
+    private val kosmos = testKosmos()
+    private val testScope = kosmos.testScope
+    @Mock lateinit var settingsProxy: SettingsProxy
+    @Mock lateinit var userSettingsProxy: UserSettingsProxy
+
+    @Before
+    fun setUp() {
+        MockitoAnnotations.initMocks(this)
+    }
+
+    @Test
+    @EnableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagEnabled_settingsProxy_registerContentObserverInvoked() =
+        testScope.runTest {
+            val unused by collectLastValue(settingsProxy.observerFlow(SETTING_1, SETTING_2))
+            runCurrent()
+            verify(settingsProxy, times(2))
+                .registerContentObserver(any<String>(), any<ContentObserver>())
+        }
+
+    @Test
+    @DisableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagDisabled_multipleSettings_SettingsProxy_registerContentObserverInvoked() =
+        testScope.runTest {
+            val unused by collectLastValue(settingsProxy.observerFlow(SETTING_1, SETTING_2))
+            runCurrent()
+            verify(settingsProxy, times(2))
+                .registerContentObserverSync(any<String>(), any<ContentObserver>())
+        }
+
+    @Test
+    @EnableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagEnabled_channelClosed_settingsProxy_unregisterContentObserverInvoked() =
+        testScope.runTest {
+            val job = Job()
+            val unused by
+                collectLastValue(settingsProxy.observerFlow(SETTING_1, SETTING_2), context = job)
+            runCurrent()
+            job.cancel()
+            runCurrent()
+            verify(settingsProxy).unregisterContentObserverAsync(any<ContentObserver>())
+        }
+
+    @Test
+    @DisableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagDisabled_channelClosed_settingsProxy_unregisterContentObserverInvoked() =
+        testScope.runTest {
+            val job = Job()
+            val unused by
+                collectLastValue(settingsProxy.observerFlow(SETTING_1, SETTING_2), context = job)
+            runCurrent()
+            job.cancel()
+            runCurrent()
+            verify(settingsProxy).unregisterContentObserverSync(any<ContentObserver>())
+        }
+
+    @Test
+    @EnableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagEnabled_userSettingsProxy_registerContentObserverForUserInvoked() =
+        testScope.runTest {
+            val unused by
+                collectLastValue(userSettingsProxy.observerFlow(userId = 0, SETTING_1, SETTING_2))
+            runCurrent()
+            verify(userSettingsProxy, times(2))
+                .registerContentObserverForUser(any<String>(), any<ContentObserver>(), any<Int>())
+        }
+
+    @Test
+    @DisableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagDisabled_userSettingsProxy_registerContentObserverForUserInvoked() =
+        testScope.runTest {
+            val unused by
+                collectLastValue(userSettingsProxy.observerFlow(userId = 0, SETTING_1, SETTING_2))
+            runCurrent()
+            verify(userSettingsProxy, times(2))
+                .registerContentObserverForUserSync(
+                    any<String>(),
+                    any<ContentObserver>(),
+                    any<Int>()
+                )
+        }
+
+    @Test
+    @EnableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagEnabled_channelClosed_userSettingsProxy_unregisterContentObserverInvoked() =
+        testScope.runTest {
+            val job = Job()
+            val unused by
+                collectLastValue(
+                    userSettingsProxy.observerFlow(userId = 0, SETTING_1, SETTING_2),
+                    context = job
+                )
+            runCurrent()
+            job.cancel()
+            runCurrent()
+            verify(userSettingsProxy).unregisterContentObserverAsync(any<ContentObserver>())
+        }
+
+    @Test
+    @DisableFlags(Flags.FLAG_SETTINGS_EXT_REGISTER_CONTENT_OBSERVER_ON_BG_THREAD)
+    fun observeFlow_bgFlagDisabled_channelClosed_userSettingsProxy_unregisterContentObserverInvoked() =
+        testScope.runTest {
+            val job = Job()
+            val unused by
+                collectLastValue(
+                    userSettingsProxy.observerFlow(userId = 0, SETTING_1, SETTING_2),
+                    context = job
+                )
+            runCurrent()
+            job.cancel()
+            runCurrent()
+            verify(userSettingsProxy).unregisterContentObserverSync(any<ContentObserver>())
+        }
+
+    private companion object {
+        val SETTING_1 = "settings_1"
+        val SETTING_2 = "settings_2"
+    }
+}
diff --git a/packages/SystemUI/src/com/android/systemui/util/settings/SettingsProxyExt.kt b/packages/SystemUI/src/com/android/systemui/util/settings/SettingsProxyExt.kt
index d757e33..36468144 100644
--- a/packages/SystemUI/src/com/android/systemui/util/settings/SettingsProxyExt.kt
+++ b/packages/SystemUI/src/com/android/systemui/util/settings/SettingsProxyExt.kt
@@ -19,6 +19,7 @@
 
 import android.annotation.UserIdInt
 import android.database.ContentObserver
+import com.android.systemui.Flags
 import com.android.systemui.common.coroutine.ConflatedCallbackFlow.conflatedCallbackFlow
 import kotlinx.coroutines.channels.awaitClose
 import kotlinx.coroutines.flow.Flow
@@ -39,9 +40,21 @@
                     }
                 }
 
-            names.forEach { name -> registerContentObserverForUserSync(name, observer, userId) }
+            names.forEach { name ->
+                if (Flags.settingsExtRegisterContentObserverOnBgThread()) {
+                    registerContentObserverForUser(name, observer, userId)
+                } else {
+                    registerContentObserverForUserSync(name, observer, userId)
+                }
+            }
 
-            awaitClose { unregisterContentObserverSync(observer) }
+            awaitClose {
+                if (Flags.settingsExtRegisterContentObserverOnBgThread()) {
+                    unregisterContentObserverAsync(observer)
+                } else {
+                    unregisterContentObserverSync(observer)
+                }
+            }
         }
     }
 
@@ -57,9 +70,21 @@
                     }
                 }
 
-            names.forEach { name -> registerContentObserverSync(name, observer) }
+            names.forEach { name ->
+                if (Flags.settingsExtRegisterContentObserverOnBgThread()) {
+                    registerContentObserver(name, observer)
+                } else {
+                    registerContentObserverSync(name, observer)
+                }
+            }
 
-            awaitClose { unregisterContentObserverSync(observer) }
+            awaitClose {
+                if (Flags.settingsExtRegisterContentObserverOnBgThread()) {
+                    unregisterContentObserverAsync(observer)
+                } else {
+                    unregisterContentObserverSync(observer)
+                }
+            }
         }
     }
 }