diff --git a/docs/pages/api-docs/autocomplete.md b/docs/pages/api-docs/autocomplete.md
index 9b9b34aed76166..9ed93814f8528f 100644
--- a/docs/pages/api-docs/autocomplete.md
+++ b/docs/pages/api-docs/autocomplete.md
@@ -69,6 +69,7 @@ The `MuiAutocomplete` name can be used for providing [default props](/customizat
 | <span class="prop-name">noOptionsText</span> | <span class="prop-type">node</span> | <span class="prop-default">'No options'</span> | Text to display when there are no options.<br>For localization purposes, you can use the provided [translations](/guides/localization/). |
 | <span class="prop-name">onChange</span> | <span class="prop-type">func</span> |  | Callback fired when the value changes.<br><br>**Signature:**<br>`function(event: object, value: T, reason: string) => void`<br>*event:* The event source of the callback.<br>*value:* The new value of the component.<br>*reason:* One of "create-option", "select-option", "remove-option", "blur" or "clear". |
 | <span class="prop-name">onClose</span> | <span class="prop-type">func</span> |  | Callback fired when the popup requests to be closed. Use in controlled mode (see open).<br><br>**Signature:**<br>`function(event: object, reason: string) => void`<br>*event:* The event source of the callback.<br>*reason:* Can be: `"toggleInput"`, `"escape"`, `"select-option"`, `"blur"`. |
+| <span class="prop-name">onHighlightChange</span> | <span class="prop-type">func</span> |  | Callback fired when the highlight option changes.<br><br>**Signature:**<br>`function(event: object, option: T, reason: string) => void`<br>*event:* The event source of the callback.<br>*option:* The highlighted option.<br>*reason:* Can be: `"keyboard"`, `"auto"`, `"mouse"`. |
 | <span class="prop-name">onInputChange</span> | <span class="prop-type">func</span> |  | Callback fired when the input value changes.<br><br>**Signature:**<br>`function(event: object, value: string, reason: string) => void`<br>*event:* The event source of the callback.<br>*value:* The new value of the text input.<br>*reason:* Can be: `"input"` (user input), `"reset"` (programmatic change), `"clear"`. |
 | <span class="prop-name">onOpen</span> | <span class="prop-type">func</span> |  | Callback fired when the popup requests to be opened. Use in controlled mode (see open).<br><br>**Signature:**<br>`function(event: object) => void`<br>*event:* The event source of the callback. |
 | <span class="prop-name">open</span> | <span class="prop-type">bool</span> |  | Control the popup` open state. |
diff --git a/packages/material-ui-lab/src/Autocomplete/Autocomplete.js b/packages/material-ui-lab/src/Autocomplete/Autocomplete.js
index 3fd03bfc45aace..f6c58d99a54206 100644
--- a/packages/material-ui-lab/src/Autocomplete/Autocomplete.js
+++ b/packages/material-ui-lab/src/Autocomplete/Autocomplete.js
@@ -279,6 +279,7 @@ const Autocomplete = React.forwardRef(function Autocomplete(props, ref) {
     noOptionsText = 'No options',
     onChange,
     onClose,
+    onHighlightChange,
     onInputChange,
     onOpen,
     open,
@@ -729,6 +730,14 @@ Autocomplete.propTypes = {
    * @param {string} reason Can be: `"toggleInput"`, `"escape"`, `"select-option"`, `"blur"`.
    */
   onClose: PropTypes.func,
+  /**
+   * Callback fired when the highlight option changes.
+   *
+   * @param {object} event The event source of the callback.
+   * @param {T} option The highlighted option.
+   * @param {string} reason Can be: `"keyboard"`, `"auto"`, `"mouse"`.
+   */
+  onHighlightChange: PropTypes.func,
   /**
    * Callback fired when the input value changes.
    *
diff --git a/packages/material-ui-lab/src/Autocomplete/Autocomplete.test.js b/packages/material-ui-lab/src/Autocomplete/Autocomplete.test.js
index 1eade23ae29bba..b222c51665b0d6 100644
--- a/packages/material-ui-lab/src/Autocomplete/Autocomplete.test.js
+++ b/packages/material-ui-lab/src/Autocomplete/Autocomplete.test.js
@@ -1549,4 +1549,66 @@ describe('<Autocomplete />', () => {
       expect(container.querySelector(`.${classes.root}`)).to.have.class(classes.fullWidth);
     });
   });
+
+  describe('prop: onHighlightChange', () => {
+    it('should trigger event when default value is passed', () => {
+      const handleChange = spy();
+      const options = ['one', 'two', 'three'];
+      render(
+        <Autocomplete
+          defaultValue={options[0]}
+          onHighlightChange={handleChange}
+          options={options}
+          open
+          renderInput={(params) => <TextField autoFocus {...params} />}
+        />,
+      );
+      expect(handleChange.callCount).to.equal(1);
+      expect(handleChange.args[0][0]).to.equal(undefined);
+      expect(handleChange.args[0][1]).to.equal(options[0]);
+      expect(handleChange.args[0][2]).to.equal('auto');
+    });
+
+    it('should support keyboard event', () => {
+      const handleChange = spy();
+      const options = ['one', 'two', 'three'];
+      render(
+        <Autocomplete
+          onHighlightChange={handleChange}
+          options={options}
+          open
+          renderInput={(params) => <TextField autoFocus {...params} />}
+        />,
+      );
+      fireEvent.keyDown(document.activeElement, { key: 'ArrowDown' });
+      expect(handleChange.callCount).to.equal(2);
+      expect(handleChange.args[1][0]).to.not.equal(undefined);
+      expect(handleChange.args[1][1]).to.equal(options[0]);
+      expect(handleChange.args[1][2]).to.equal('keyboard');
+      fireEvent.keyDown(document.activeElement, { key: 'ArrowDown' });
+      expect(handleChange.callCount).to.equal(3);
+      expect(handleChange.args[2][0]).to.not.equal(undefined);
+      expect(handleChange.args[2][1]).to.equal(options[1]);
+      expect(handleChange.args[2][2]).to.equal('keyboard');
+    });
+
+    it('should support mouse event', () => {
+      const handleChange = spy();
+      const options = ['one', 'two', 'three'];
+      const { getAllByRole } = render(
+        <Autocomplete
+          onHighlightChange={handleChange}
+          options={options}
+          open
+          renderInput={(params) => <TextField autoFocus {...params} />}
+        />,
+      );
+      const firstOption = getAllByRole('option')[0];
+      fireEvent.mouseOver(firstOption);
+      expect(handleChange.callCount).to.equal(2);
+      expect(handleChange.args[1][0]).to.not.equal(undefined);
+      expect(handleChange.args[1][1]).to.equal(options[0]);
+      expect(handleChange.args[1][2]).to.equal('mouse');
+    });
+  });
 });
diff --git a/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.d.ts b/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.d.ts
index 22d3e470954b7c..4d6132cdbf1f1e 100644
--- a/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.d.ts
+++ b/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.d.ts
@@ -170,6 +170,18 @@ export interface UseAutocompleteCommonProps<T> {
    * @param {object} event The event source of the callback.
    */
   onOpen?: (event: React.ChangeEvent<{}>) => void;
+  /**
+   * Callback fired when the highlight option changes.
+   *
+   * @param {object} event The event source of the callback.
+   * @param {T} option The highlighted option.
+   * @param {string} reason Can be: `"keyboard"`, `"auto"`, `"mouse"`.
+   */
+  onHighlightChange?: (
+    event: React.ChangeEvent<{}>,
+    option: T | null,
+    reason: AutocompleteHighlightChangeReason
+  ) => void;
   /**
    * Control the popup` open state.
    */
@@ -189,6 +201,8 @@ export interface UseAutocompleteCommonProps<T> {
   selectOnFocus?: boolean;
 }
 
+export type AutocompleteHighlightChangeReason = 'keyboard' | 'mouse' | 'auto';
+
 export type AutocompleteChangeReason =
   | 'create-option'
   | 'select-option'
diff --git a/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.js b/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.js
index f01076949360ff..f53b23e23b8d4c 100644
--- a/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.js
+++ b/packages/material-ui-lab/src/useAutocomplete/useAutocomplete.js
@@ -99,6 +99,7 @@ export default function useAutocomplete(props) {
     multiple = false,
     onChange,
     onClose,
+    onHighlightChange,
     onInputChange,
     onOpen,
     open: openProp,
@@ -120,7 +121,7 @@ export default function useAutocomplete(props) {
   const defaultHighlighted = autoHighlight ? 0 : -1;
   const highlightedIndexRef = React.useRef(defaultHighlighted);
 
-  const setHighlightedIndex = useEventCallback((index, mouse = false) => {
+  const setHighlightedIndex = useEventCallback((index, reason = 'auto', event) => {
     highlightedIndexRef.current = index;
     // does the index exist?
     if (index === -1) {
@@ -145,6 +146,10 @@ export default function useAutocomplete(props) {
       return;
     }
 
+    if (onHighlightChange) {
+      onHighlightChange(event, options[index], reason);
+    }
+
     if (index === -1) {
       listboxNode.scrollTop = 0;
       return;
@@ -163,7 +168,7 @@ export default function useAutocomplete(props) {
     //
     // Consider this API instead once it has a better browser support:
     // .scrollIntoView({ scrollMode: 'if-needed', block: 'nearest' });
-    if (listboxNode.scrollHeight > listboxNode.clientHeight && !mouse) {
+    if (listboxNode.scrollHeight > listboxNode.clientHeight && reason !== 'mouse') {
       const element = option;
 
       const scrollBottom = listboxNode.clientHeight + listboxNode.scrollTop;
@@ -332,7 +337,7 @@ export default function useAutocomplete(props) {
     }
   }
 
-  const changeHighlightedIndex = useEventCallback((diff, direction) => {
+  const changeHighlightedIndex = useEventCallback((diff, direction, reason = 'auto', event) => {
     if (!popupOpen) {
       return;
     }
@@ -382,7 +387,7 @@ export default function useAutocomplete(props) {
     };
 
     const nextIndex = validOptionIndex(getNextIndex(), direction);
-    setHighlightedIndex(nextIndex);
+    setHighlightedIndex(nextIndex, reason, event);
 
     if (autoComplete && diff !== 'reset') {
       if (nextIndex === -1) {
@@ -627,38 +632,38 @@ export default function useAutocomplete(props) {
         if (popupOpen) {
           // Prevent scroll of the page
           event.preventDefault();
-          changeHighlightedIndex('start', 'next');
+          changeHighlightedIndex('start', 'next', 'keyboard', event);
         }
         break;
       case 'End':
         if (popupOpen) {
           // Prevent scroll of the page
           event.preventDefault();
-          changeHighlightedIndex('end', 'previous');
+          changeHighlightedIndex('end', 'previous', 'keyboard', event);
         }
         break;
       case 'PageUp':
         // Prevent scroll of the page
         event.preventDefault();
-        changeHighlightedIndex(-pageSize, 'previous');
+        changeHighlightedIndex(-pageSize, 'previous', 'keyboard', event);
         handleOpen(event);
         break;
       case 'PageDown':
         // Prevent scroll of the page
         event.preventDefault();
-        changeHighlightedIndex(pageSize, 'next');
+        changeHighlightedIndex(pageSize, 'next', 'keyboard', event);
         handleOpen(event);
         break;
       case 'ArrowDown':
         // Prevent cursor move
         event.preventDefault();
-        changeHighlightedIndex(1, 'next');
+        changeHighlightedIndex(1, 'next', 'keyboard', event);
         handleOpen(event);
         break;
       case 'ArrowUp':
         // Prevent cursor move
         event.preventDefault();
-        changeHighlightedIndex(-1, 'previous');
+        changeHighlightedIndex(-1, 'previous', 'keyboard', event);
         handleOpen(event);
         break;
       case 'ArrowLeft':
@@ -791,7 +796,7 @@ export default function useAutocomplete(props) {
 
   const handleOptionMouseOver = (event) => {
     const index = Number(event.currentTarget.getAttribute('data-option-index'));
-    setHighlightedIndex(index, 'mouse');
+    setHighlightedIndex(index, 'mouse', event);
   };
 
   const handleOptionTouchStart = () => {