diff --git a/Composer/packages/client/__tests__/mocks/ResizeObserver.ts b/Composer/packages/client/__tests__/mocks/ResizeObserver.ts
new file mode 100644
index 0000000000..81607f4b4a
--- /dev/null
+++ b/Composer/packages/client/__tests__/mocks/ResizeObserver.ts
@@ -0,0 +1,14 @@
+// Copyright (c) Microsoft Corporation.
+// Licensed under the MIT License.
+
+export default class ResizeObserver {
+  observe() {
+    // do nothing
+  }
+  unobserve() {
+    // do nothing
+  }
+  disconnect() {
+    // do nothing
+  }
+}
diff --git a/Composer/packages/client/__tests__/pages/design/Design.test.tsx b/Composer/packages/client/__tests__/pages/design/Design.test.tsx
index d3b12856af..507ca29aa9 100644
--- a/Composer/packages/client/__tests__/pages/design/Design.test.tsx
+++ b/Composer/packages/client/__tests__/pages/design/Design.test.tsx
@@ -16,6 +16,9 @@ import { undoFunctionState } from '../../../src/recoilModel/undo/history';
 import mockProjectResponse from '../../../src/recoilModel/dispatchers/__tests__/mocks/mockProjectResponse.json';
 import DesignPage from '../../../src/pages/design/DesignPage';
 import { SAMPLE_DIALOG } from '../../mocks/sampleDialog';
+import ResizeObserver from '../../mocks/ResizeObserver';
+
+(global as any).ResizeObserver = ResizeObserver;
 
 const projectId = '12345.6789';
 const dialogId = SAMPLE_DIALOG.id;
diff --git a/Composer/packages/client/src/hooks/useResizeObserver.ts b/Composer/packages/client/src/hooks/useResizeObserver.ts
new file mode 100644
index 0000000000..6357cdebd8
--- /dev/null
+++ b/Composer/packages/client/src/hooks/useResizeObserver.ts
@@ -0,0 +1,39 @@
+/* eslint-disable @typescript-eslint/ban-ts-ignore */
+// Copyright (c) Microsoft Corporation.
+// Licensed under the MIT License.
+
+import React from 'react';
+
+/*
+ * TODO: remove ts-ignore after updating typescript to v4.
+ * current typescript version does not have definitions for ResizeObserver.
+ */
+
+/**
+ * Observes size changes of a given element and runs the provided callback.
+ * @param element Element to observe size changes.
+ * @param resizeCallback Callback to call when resize happens.
+ * @param options Optional options for resize observer.
+ */
+export const useResizeObserver = <T extends HTMLElement>(
+  element: T | null,
+  // @ts-ignore
+  resizeCallback: (entries: ResizeObserverEntry[]) => void,
+  // @ts-ignore
+  options?: ResizeObserverOptions
+) => {
+  // @ts-ignore
+  const resizeObserver = React.useRef(new ResizeObserver(resizeCallback));
+
+  React.useEffect(() => {
+    if (element) {
+      resizeObserver.current.observe(element, options);
+    }
+
+    return () => {
+      if (element) {
+        resizeObserver.current.unobserve(element);
+      }
+    };
+  }, [element]);
+};
diff --git a/Composer/packages/client/src/pages/design/VisualPanelHeader.tsx b/Composer/packages/client/src/pages/design/VisualPanelHeader.tsx
index 8cb60601e4..951ae1f1b2 100644
--- a/Composer/packages/client/src/pages/design/VisualPanelHeader.tsx
+++ b/Composer/packages/client/src/pages/design/VisualPanelHeader.tsx
@@ -17,8 +17,9 @@ import { getDialogData } from '../../utils/dialogUtil';
 import { decodeDesignerPathToArrayPath } from '../../utils/convertUtils/designerPathEncoder';
 import { getFocusPath } from '../../utils/navigation';
 import { TreeLink } from '../../components/ProjectTree/types';
+import { useResizeObserver } from '../../hooks/useResizeObserver';
 
-import { breadcrumbClass } from './styles';
+import * as pageStyles from './styles';
 
 type BreadcrumbItem = {
   key: string;
@@ -155,11 +156,40 @@ const useBreadcrumbs = (projectId: string, pluginConfig?: PluginConfig) => {
   }, [currentDialog?.content, initialBreadcrumbArray]);
   return breadcrumbArray;
 };
-
+const defaultToggleButtonWidth = 100;
+const spaceBetweenContainers = 6;
 const VisualPanelHeader: React.FC<VisualPanelHeaderProps> = React.memo((props) => {
   const { showCode, projectId, onShowCodeClick, pluginConfig } = props;
+
   const breadcrumbs = useBreadcrumbs(projectId, pluginConfig);
 
+  const toggleButtonContainerRef = React.useRef<HTMLDivElement>(null);
+  const containerRef = React.useRef<HTMLDivElement>(null);
+
+  const [toggleButtonWidth, setToggleButtonWidth] = React.useState(defaultToggleButtonWidth);
+  const [breadcrumbContainerWidth, setBreadcrumbContainerWidth] = React.useState<number | string>(
+    `calc(100% - ${toggleButtonWidth}px)`
+  );
+
+  // Set the width of the toggle button based on its text (locale)
+  React.useEffect(() => {
+    if (toggleButtonContainerRef.current) {
+      const toggleButton = toggleButtonContainerRef.current.querySelector<HTMLButtonElement>('button');
+      if (toggleButton) {
+        const { width } = toggleButton?.getBoundingClientRect();
+        setToggleButtonWidth(width);
+      }
+    }
+  }, []);
+
+  // Observe width changes of the container to re-set the available width for breadcrumb container
+  useResizeObserver<HTMLDivElement>(containerRef.current, (entries) => {
+    if (entries.length) {
+      const { width } = entries[0].contentRect;
+      setBreadcrumbContainerWidth(width - toggleButtonWidth - spaceBetweenContainers);
+    }
+  });
+
   const createBreadcrumbItem: (breadcrumb: BreadcrumbItem) => IBreadcrumbItem = (breadcrumb: BreadcrumbItem) => {
     return {
       key: breadcrumb.key,
@@ -171,16 +201,16 @@ const VisualPanelHeader: React.FC<VisualPanelHeaderProps> = React.memo((props) =
   const items = breadcrumbs.map(createBreadcrumbItem);
 
   return (
-    <div style={{ display: 'flex', justifyContent: 'space-between', height: '65px' }}>
-      <Breadcrumb
-        ariaLabel={formatMessage('Navigation Path')}
-        data-testid="Breadcrumb"
-        items={items}
-        maxDisplayedItems={3}
-        styles={breadcrumbClass}
-        onReduceData={() => undefined}
-      />
-      <div style={{ padding: '10px' }}>
+    <div ref={containerRef} css={pageStyles.visualPanelHeaderContainer}>
+      <div style={{ width: breadcrumbContainerWidth }}>
+        <Breadcrumb
+          ariaLabel={formatMessage('Navigation Path')}
+          data-testid="Breadcrumb"
+          items={items}
+          styles={pageStyles.breadcrumbClass}
+        />
+      </div>
+      <div ref={toggleButtonContainerRef} css={pageStyles.visualPanelHeaderShowCodeButton}>
         <ActionButton onClick={onShowCodeClick}>
           {showCode ? formatMessage('Hide code') : formatMessage('Show code')}
         </ActionButton>
diff --git a/Composer/packages/client/src/pages/design/styles.ts b/Composer/packages/client/src/pages/design/styles.ts
index 9d0e9a70be..cfe8679dee 100644
--- a/Composer/packages/client/src/pages/design/styles.ts
+++ b/Composer/packages/client/src/pages/design/styles.ts
@@ -103,9 +103,19 @@ export const formEditor = css`
   min-width: 300px;
 `;
 
+export const visualPanelHeaderContainer = css`
+  display: flex;
+  align-items: center;
+  height: 65px;
+`;
+
+export const visualPanelHeaderShowCodeButton = css`
+  padding: 10px;
+  width: fit-content;
+`;
+
 export const breadcrumbClass = mergeStyleSets({
   root: {
-    width: '500px',
     margin: '0',
     padding: '10px',
   },