diff --git a/change/@fluentui-react-avatar-1ab0ce5a-6046-4069-8ac6-496201496645.json b/change/@fluentui-react-avatar-1ab0ce5a-6046-4069-8ac6-496201496645.json
new file mode 100644
index 00000000000000..341b1123863243
--- /dev/null
+++ b/change/@fluentui-react-avatar-1ab0ce5a-6046-4069-8ac6-496201496645.json
@@ -0,0 +1,7 @@
+{
+  "type": "prerelease",
+  "comment": "Adding AvatarGroupItem implementation and AvatarGroup context.",
+  "packageName": "@fluentui/react-avatar",
+  "email": "esteban.230@hotmail.com",
+  "dependentChangeType": "patch"
+}
diff --git a/packages/react-components/react-avatar/etc/react-avatar.api.md b/packages/react-components/react-avatar/etc/react-avatar.api.md
index acd961b9ba29b7..8c49b7d03b5355 100644
--- a/packages/react-components/react-avatar/etc/react-avatar.api.md
+++ b/packages/react-components/react-avatar/etc/react-avatar.api.md
@@ -34,15 +34,19 @@ export const AvatarGroupItem: ForwardRefComponent<AvatarGroupItemProps>;
 export const avatarGroupItemClassNames: SlotClassNames<AvatarGroupItemSlots>;
 
 // @public
-export type AvatarGroupItemProps = ComponentProps<AvatarGroupItemSlots> & {};
+export type AvatarGroupItemProps = ComponentProps<Partial<AvatarGroupItemSlots>, 'avatar'>;
 
 // @public (undocumented)
 export type AvatarGroupItemSlots = {
-    root: Slot<'div'>;
+    root: NonNullable<Slot<'div', 'li'>>;
+    avatar: NonNullable<Slot<typeof Avatar>>;
+    overflowLabel: NonNullable<Slot<'span'>>;
 };
 
 // @public
-export type AvatarGroupItemState = ComponentState<AvatarGroupItemSlots>;
+export type AvatarGroupItemState = ComponentState<AvatarGroupItemSlots> & {
+    isOverflowItem?: boolean;
+};
 
 // @public
 export type AvatarGroupProps = ComponentProps<AvatarGroupSlots> & {
@@ -61,7 +65,7 @@ export type AvatarGroupSlots = {
 };
 
 // @public
-export type AvatarGroupState = ComponentState<AvatarGroupSlots> & {
+export type AvatarGroupState = ComponentState<AvatarGroupSlots> & Required<Pick<AvatarGroupProps, 'layout' | 'maxAvatars' | 'size' | 'overflowIndicator'>> & {
     tooltipContent: TooltipProps['content'];
 };
 
diff --git a/packages/react-components/react-avatar/package.json b/packages/react-components/react-avatar/package.json
index 6d4e1898bb65f6..e32a6c18d63ff8 100644
--- a/packages/react-components/react-avatar/package.json
+++ b/packages/react-components/react-avatar/package.json
@@ -35,6 +35,7 @@
   "dependencies": {
     "@fluentui/react-badge": "9.0.0-rc.12",
     "@fluentui/react-button": "9.0.0-rc.13",
+    "@fluentui/react-context-selector": "9.0.0-rc.10",
     "@fluentui/react-icons": "^2.0.166-rc.3",
     "@fluentui/react-popover": "9.0.0-rc.13",
     "@fluentui/react-tooltip": "9.0.0-rc.13",
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroup/AvatarGroup.types.ts b/packages/react-components/react-avatar/src/components/AvatarGroup/AvatarGroup.types.ts
index 390cdc9dfcb530..b774264753ddf9 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroup/AvatarGroup.types.ts
+++ b/packages/react-components/react-avatar/src/components/AvatarGroup/AvatarGroup.types.ts
@@ -1,8 +1,8 @@
-import type { ComponentProps, ComponentState, Slot } from '@fluentui/react-utilities';
-import { PopoverSurface } from '@fluentui/react-popover';
-import { AvatarSizes } from '../Avatar/Avatar.types';
 import { Button } from '@fluentui/react-button';
+import { PopoverSurface } from '@fluentui/react-popover';
 import { TooltipProps } from '@fluentui/react-tooltip';
+import type { AvatarSizes } from '../Avatar/Avatar.types';
+import type { ComponentProps, ComponentState, Slot } from '@fluentui/react-utilities';
 
 export type AvatarGroupSlots = {
   root: Slot<'div'>;
@@ -56,10 +56,12 @@ export type AvatarGroupProps = ComponentProps<AvatarGroupSlots> & {
 /**
  * State used in rendering AvatarGroup
  */
-export type AvatarGroupState = ComponentState<AvatarGroupSlots> & {
-  tooltipContent: TooltipProps['content'];
-};
+export type AvatarGroupState = ComponentState<AvatarGroupSlots> &
+  Required<Pick<AvatarGroupProps, 'layout' | 'maxAvatars' | 'size' | 'overflowIndicator'>> & {
+    tooltipContent: TooltipProps['content'];
+  };
 
+// TODO: Remove strings from AvatarGroup.
 export type AvatarGroupStrings = {
   /**
    * Text applied to the overflow indicator's tooltip.
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroup/useAvatarGroup.ts b/packages/react-components/react-avatar/src/components/AvatarGroup/useAvatarGroup.ts
index 77647222201e6b..8b3d74161ad6d6 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroup/useAvatarGroup.ts
+++ b/packages/react-components/react-avatar/src/components/AvatarGroup/useAvatarGroup.ts
@@ -15,10 +15,21 @@ import { avatarGroupDefaultStrings } from './AvatarGroup.strings';
  * @param ref - reference to root HTMLElement of AvatarGroup
  */
 export const useAvatarGroup_unstable = (props: AvatarGroupProps, ref: React.Ref<HTMLElement>): AvatarGroupState => {
-  const { children, strings = avatarGroupDefaultStrings } = props;
+  const {
+    children,
+    layout = 'spread',
+    maxAvatars = 5,
+    overflowIndicator = 'number-overflowed',
+    size = 32,
+    strings = avatarGroupDefaultStrings,
+  } = props;
 
   return {
     // TODO: Replace with actual logic.
+    layout,
+    maxAvatars,
+    overflowIndicator,
+    size,
     tooltipContent: strings.tooltipContent.replace('{numOverflowedAvatars}', String(10)),
     components: {
       // TODO add each slot's element type or component
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.test.tsx b/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.test.tsx
index 98a0be76fd4312..f0883e79bf27e6 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.test.tsx
+++ b/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.test.tsx
@@ -7,13 +7,19 @@ describe('AvatarGroupItem', () => {
   isConformant({
     Component: AvatarGroupItem,
     displayName: 'AvatarGroupItem',
-    disabledTests: ['component-has-static-classname', 'component-has-static-classname-exported'],
+    // TODO: enable component-has-static-classnames-object
+    disabledTests: [
+      'component-has-static-classname',
+      'component-has-static-classname-exported',
+      'component-has-static-classnames-object',
+    ],
+    primarySlot: 'avatar',
   });
 
   // TODO add more tests here, and create visual regression tests in /apps/vr-tests
 
   it('renders a default state', () => {
-    const result = render(<AvatarGroupItem>Default AvatarGroupItem</AvatarGroupItem>);
+    const result = render(<AvatarGroupItem name="Default AvatarGroupItem" />);
     expect(result.container).toMatchSnapshot();
   });
 });
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.tsx b/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.tsx
index 4cd0c1183f1a8c..9a579535f35e2e 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.tsx
+++ b/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.tsx
@@ -6,7 +6,8 @@ import type { AvatarGroupItemProps } from './AvatarGroupItem.types';
 import type { ForwardRefComponent } from '@fluentui/react-utilities';
 
 /**
- * AvatarGroupItem component - TODO: add more docs
+ * The AvatarGroupItem component represents a single person or entity.
+ * AvatarGroupItem should only be used in an AvatarGroup component.
  */
 export const AvatarGroupItem: ForwardRefComponent<AvatarGroupItemProps> = React.forwardRef((props, ref) => {
   const state = useAvatarGroupItem_unstable(props, ref);
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.types.ts b/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.types.ts
index 1fdd7f36369153..d8d19638afcd7c 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.types.ts
+++ b/packages/react-components/react-avatar/src/components/AvatarGroupItem/AvatarGroupItem.types.ts
@@ -1,15 +1,34 @@
 import type { ComponentProps, ComponentState, Slot } from '@fluentui/react-utilities';
+import type { Avatar } from '../../Avatar';
 
 export type AvatarGroupItemSlots = {
-  root: Slot<'div'>;
+  root: NonNullable<Slot<'div', 'li'>>;
+
+  /**
+   * Avatar that represents a person or entity.
+   */
+  avatar: NonNullable<Slot<typeof Avatar>>;
+
+  /**
+   * Label used for the name of the AvatarGroupItem when rendered as an overflow item.
+   * The content of the label, by default, is the `name` prop from the `avatar` slot.
+   */
+  overflowLabel: NonNullable<Slot<'span'>>;
 };
 
 /**
  * AvatarGroupItem Props
  */
-export type AvatarGroupItemProps = ComponentProps<AvatarGroupItemSlots> & {};
+export type AvatarGroupItemProps = ComponentProps<Partial<AvatarGroupItemSlots>, 'avatar'>;
 
 /**
  * State used in rendering AvatarGroupItem
  */
-export type AvatarGroupItemState = ComponentState<AvatarGroupItemSlots>;
+export type AvatarGroupItemState = ComponentState<AvatarGroupItemSlots> & {
+  /**
+   * Whether the Avatar is an overflow item.
+   *
+   * @default false
+   */
+  isOverflowItem?: boolean;
+};
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroupItem/__snapshots__/AvatarGroupItem.test.tsx.snap b/packages/react-components/react-avatar/src/components/AvatarGroupItem/__snapshots__/AvatarGroupItem.test.tsx.snap
index 490dd390059bc5..9cb36e01df8569 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroupItem/__snapshots__/AvatarGroupItem.test.tsx.snap
+++ b/packages/react-components/react-avatar/src/components/AvatarGroupItem/__snapshots__/AvatarGroupItem.test.tsx.snap
@@ -5,7 +5,19 @@ exports[`AvatarGroupItem renders a default state 1`] = `
   <div
     class="fui-AvatarGroupItem"
   >
-    Default AvatarGroupItem
+    <span
+      aria-label="Default AvatarGroupItem"
+      class="fui-Avatar fui-AvatarGroupItem__avatar"
+      id="avatar-8"
+      role="img"
+    >
+      <span
+        class="fui-Avatar__initials"
+        id="avatar-8__initials"
+      >
+        DA
+      </span>
+    </span>
   </div>
 </div>
 `;
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroupItem/renderAvatarGroupItem.tsx b/packages/react-components/react-avatar/src/components/AvatarGroupItem/renderAvatarGroupItem.tsx
index 9ca22b9d585caf..6b8fac77d0ae91 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroupItem/renderAvatarGroupItem.tsx
+++ b/packages/react-components/react-avatar/src/components/AvatarGroupItem/renderAvatarGroupItem.tsx
@@ -8,6 +8,10 @@ import type { AvatarGroupItemState, AvatarGroupItemSlots } from './AvatarGroupIt
 export const renderAvatarGroupItem_unstable = (state: AvatarGroupItemState) => {
   const { slots, slotProps } = getSlots<AvatarGroupItemSlots>(state);
 
-  // TODO Add additional slots in the appropriate place
-  return <slots.root {...slotProps.root} />;
+  return (
+    <slots.root {...slotProps.root}>
+      <slots.avatar {...slotProps.avatar} />
+      {state.isOverflowItem && <slots.overflowLabel {...slotProps.overflowLabel} />}
+    </slots.root>
+  );
 };
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItem.ts b/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItem.ts
index e6f737437e460b..8203a44a83f064 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItem.ts
+++ b/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItem.ts
@@ -1,5 +1,8 @@
 import * as React from 'react';
-import { getNativeElementProps } from '@fluentui/react-utilities';
+import { Avatar } from '../Avatar/Avatar';
+import { AvatarGroupContext } from '../../contexts/AvatarGroupContext';
+import { resolveShorthand } from '@fluentui/react-utilities';
+import { useContextSelector } from '@fluentui/react-context-selector';
 import type { AvatarGroupItemProps, AvatarGroupItemState } from './AvatarGroupItem.types';
 
 /**
@@ -15,17 +18,41 @@ export const useAvatarGroupItem_unstable = (
   props: AvatarGroupItemProps,
   ref: React.Ref<HTMLElement>,
 ): AvatarGroupItemState => {
+  const groupIsOverflow = useContextSelector(AvatarGroupContext, ctx => ctx.isOverflow);
+  const groupSize = useContextSelector(AvatarGroupContext, ctx => ctx.size);
+  // Since the primary slot is not an intrinsic element, getPartitionedNativeProps cannot be used here.
+  const { style, className, ...avatarSlotProps } = props;
+
   return {
-    // TODO add appropriate props/defaults
+    isOverflowItem: groupIsOverflow,
     components: {
-      // TODO add each slot's element type or component
       root: 'div',
+      avatar: Avatar,
+      overflowLabel: 'span',
     },
-    // TODO add appropriate slots, for example:
-    // mySlot: resolveShorthand(props.mySlot),
-    root: getNativeElementProps('div', {
-      ref,
-      ...props,
+    root: resolveShorthand(props.root, {
+      required: true,
+      defaultProps: {
+        style,
+        className,
+        as: groupIsOverflow ? 'li' : 'div',
+        role: groupIsOverflow ? 'listitem' : undefined,
+      },
+    }),
+    avatar: resolveShorthand(props.avatar, {
+      required: true,
+      defaultProps: {
+        ref,
+        size: groupSize,
+        color: 'colorful',
+        ...avatarSlotProps,
+      },
+    }),
+    overflowLabel: resolveShorthand(props.overflowLabel, {
+      required: true,
+      defaultProps: {
+        children: props.name,
+      },
     }),
   };
 };
diff --git a/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItemStyles.ts b/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItemStyles.ts
index c369ce15091e24..c051ce8e461061 100644
--- a/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItemStyles.ts
+++ b/packages/react-components/react-avatar/src/components/AvatarGroupItem/useAvatarGroupItemStyles.ts
@@ -1,33 +1,63 @@
-import { makeStyles, mergeClasses } from '@griffel/react';
+import { makeStyles, mergeClasses, shorthands } from '@griffel/react';
+import { tokens } from '@fluentui/react-theme';
 import type { AvatarGroupItemSlots, AvatarGroupItemState } from './AvatarGroupItem.types';
 import type { SlotClassNames } from '@fluentui/react-utilities';
 
 export const avatarGroupItemClassNames: SlotClassNames<AvatarGroupItemSlots> = {
   root: 'fui-AvatarGroupItem',
-  // TODO: add class names for all slots on AvatarGroupItemSlots.
-  // Should be of the form `<slotName>: 'fui-AvatarGroupItem__<slotName>`
+  avatar: 'fui-AvatarGroupItem__avatar',
+  overflowLabel: 'fui-AvatarGroupItem__overflowLabel',
 };
 
 /**
  * Styles for the root slot
  */
-const useStyles = makeStyles({
-  root: {
-    // TODO Add default styles for the root element
+const useRootStyles = makeStyles({
+  base: {
+    alignItems: 'center',
+    display: 'flex',
   },
+  overflowItem: {
+    '&:not(:first-child)': {
+      ...shorthands.padding(tokens.spacingVerticalXS, tokens.spacingVerticalXS),
+    },
+  },
+});
 
-  // TODO add additional classes for different states and/or slots
+/**
+ * Styles for the label slot
+ */
+const useOverflowLabelStyles = makeStyles({
+  overflowItem: {
+    marginLeft: tokens.spacingHorizontalS,
+  },
 });
 
 /**
  * Apply styling to the AvatarGroupItem slots based on the state
  */
 export const useAvatarGroupItemStyles_unstable = (state: AvatarGroupItemState): AvatarGroupItemState => {
-  const styles = useStyles();
-  state.root.className = mergeClasses(avatarGroupItemClassNames.root, styles.root, state.root.className);
+  const { isOverflowItem } = state;
+
+  const rootStyles = useRootStyles();
+  const overflowLabelStyles = useOverflowLabelStyles();
+
+  state.root.className = mergeClasses(
+    avatarGroupItemClassNames.root,
+    rootStyles.base,
+    isOverflowItem && rootStyles.overflowItem,
+    state.root.className,
+  );
+
+  state.avatar.className = mergeClasses(avatarGroupItemClassNames.avatar, state.avatar.className);
 
-  // TODO Add class names to slots, for example:
-  // state.mySlot.className = mergeClasses(styles.mySlot, state.mySlot.className);
+  if (state.overflowLabel) {
+    state.overflowLabel.className = mergeClasses(
+      avatarGroupItemClassNames.overflowLabel,
+      isOverflowItem && overflowLabelStyles.overflowItem,
+      state.overflowLabel.className,
+    );
+  }
 
   return state;
 };
diff --git a/packages/react-components/react-avatar/src/contexts/AvatarGroupContext.ts b/packages/react-components/react-avatar/src/contexts/AvatarGroupContext.ts
new file mode 100644
index 00000000000000..3b7a9f578f6b69
--- /dev/null
+++ b/packages/react-components/react-avatar/src/contexts/AvatarGroupContext.ts
@@ -0,0 +1,8 @@
+import { createContext } from '@fluentui/react-context-selector';
+import type { Context } from '@fluentui/react-context-selector';
+import type { AvatarGroupContextValue } from './AvatarGroupContext.types';
+
+/**
+ * AvatarGroupContext is provided by AvatarGroup, and is consumed by Avatar to determine default values of some props.
+ */
+export const AvatarGroupContext: Context<AvatarGroupContextValue> = createContext({});
diff --git a/packages/react-components/react-avatar/src/contexts/AvatarGroupContext.types.ts b/packages/react-components/react-avatar/src/contexts/AvatarGroupContext.types.ts
new file mode 100644
index 00000000000000..e55c72213a1e53
--- /dev/null
+++ b/packages/react-components/react-avatar/src/contexts/AvatarGroupContext.types.ts
@@ -0,0 +1,5 @@
+import type { AvatarGroupProps } from '../AvatarGroup';
+
+export type AvatarGroupContextValue = Pick<AvatarGroupProps, 'size' | 'layout'> & {
+  isOverflow?: boolean;
+};
diff --git a/packages/react-components/react-avatar/src/contexts/index.ts b/packages/react-components/react-avatar/src/contexts/index.ts
new file mode 100644
index 00000000000000..5316e465d33035
--- /dev/null
+++ b/packages/react-components/react-avatar/src/contexts/index.ts
@@ -0,0 +1 @@
+export * from './AvatarGroupContext';
diff --git a/packages/react-components/react-avatar/src/stories/AvatarGroupItemDefault.stories.tsx b/packages/react-components/react-avatar/src/stories/AvatarGroupItemDefault.stories.tsx
index 7e3f4d5ed610fe..06409ddcbbab69 100644
--- a/packages/react-components/react-avatar/src/stories/AvatarGroupItemDefault.stories.tsx
+++ b/packages/react-components/react-avatar/src/stories/AvatarGroupItemDefault.stories.tsx
@@ -1,4 +1,4 @@
 import * as React from 'react';
 import { AvatarGroupItem, AvatarGroupItemProps } from '../index';
 
-export const Default = (props: Partial<AvatarGroupItemProps>) => <AvatarGroupItem {...props} />;
+export const Default = (props: Partial<AvatarGroupItemProps>) => <AvatarGroupItem name="Katri Athokas" {...props} />;