diff --git a/.changeset/smooth-badgers-sell.md b/.changeset/smooth-badgers-sell.md
new file mode 100644
index 0000000000..dacbefb676
--- /dev/null
+++ b/.changeset/smooth-badgers-sell.md
@@ -0,0 +1,5 @@
+---
+'@backstage/theme': patch
+---
+
+Removed the hard coded color and background color in the `MuiChip` overrides so that they work better with custom themes
diff --git a/packages/theme/src/v5/defaultComponentThemes.ts b/packages/theme/src/v5/defaultComponentThemes.ts
index 08f54b8509..e484300818 100644
--- a/packages/theme/src/v5/defaultComponentThemes.ts
+++ b/packages/theme/src/v5/defaultComponentThemes.ts
@@ -168,14 +168,9 @@ export const defaultComponentThemes: ThemeOptions['components'] = {
   MuiChip: {
     styleOverrides: {
       root: ({ theme }) => ({
-        backgroundColor: '#D9D9D9',
         // By default there's no margin, but it's usually wanted, so we add some trailing margin
         marginRight: theme.spacing(1),
         marginBottom: theme.spacing(1),
-        color: theme.palette.grey[900],
-      }),
-      outlined: ({ theme }) => ({
-        color: theme.palette.text.primary,
       }),
       label: ({ theme }) => ({
         lineHeight: theme.spacing(2.5),
@@ -186,7 +181,6 @@ export const defaultComponentThemes: ThemeOptions['components'] = {
         fontSize: theme.spacing(1.5),
       }),
       deleteIcon: ({ theme }) => ({
-        color: theme.palette.grey[500],
         width: theme.spacing(3),
         height: theme.spacing(3),
         margin: theme.spacing(0, 0.75, 0, -0.75),