diff --git a/browser/components/newtab/test/browser/abouthomecache/browser.toml b/browser/components/newtab/test/browser/abouthomecache/browser.toml
index 1db3a3b74f68..5408e25e3501 100644
--- a/browser/components/newtab/test/browser/abouthomecache/browser.toml
+++ b/browser/components/newtab/test/browser/abouthomecache/browser.toml
@@ -20,6 +20,7 @@ prefs = [
   "browser.newtabpage.activity-stream.discoverystream.sections.region-content-config=",
   "dom.ipc.processPrelaunch.delayMs=0",
   # Bug 1694957 is why we need dom.ipc.processPrelaunch.delayMs=0
+  "browser.newtabpage.activity-stream.newtabWallpapers.system.enabled=false",
 ]
 
 ["browser_basic_endtoend.js"]
diff --git a/browser/components/newtab/test/browser/browser.toml b/browser/components/newtab/test/browser/browser.toml
index 0a7579d2b01d..bda8ab96f212 100644
--- a/browser/components/newtab/test/browser/browser.toml
+++ b/browser/components/newtab/test/browser/browser.toml
@@ -7,6 +7,7 @@ prefs = [
   "browser.newtabpage.activity-stream.feeds.system.topstories=true",
   "browser.newtabpage.activity-stream.feeds.section.topstories=true",
   "messaging-system.log=all",
+  "browser.newtabpage.activity-stream.newtabWallpapers.system.enabled=false",
   "browser.newtabpage.sponsor-protection.enabled=true",
   "browser.newtabpage.sponsor-protection.debug=true",
 ]
diff --git a/browser/extensions/newtab/content-src/components/Base/Base.jsx b/browser/extensions/newtab/content-src/components/Base/Base.jsx
index cd6180d87389..b30da57e35d0 100644
--- a/browser/extensions/newtab/content-src/components/Base/Base.jsx
+++ b/browser/extensions/newtab/content-src/components/Base/Base.jsx
@@ -209,6 +209,8 @@ export class BaseContent extends React.PureComponent {
     this.applyBodyClasses();
     global.addEventListener("scroll", this.onWindowScroll);
     const prefs = this.props.Prefs.values;
+    const novaEnabled = prefs[PREF_NOVA_ENABLED];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
     const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
 
     if (this.props.document.visibilityState === VISIBLE) {
@@ -239,7 +241,10 @@ export class BaseContent extends React.PureComponent {
       this.handleColorModeChange
     );
     this.handleColorModeChange();
-    if (wallpapersEnabled) {
+    const isWallpaperVisible = novaEnabled
+      ? wallpapersSystemEnabled && wallpapersEnabled
+      : wallpapersSystemEnabled;
+    if (isWallpaperVisible) {
       this.updateWallpaper();
     }
 
@@ -285,8 +290,27 @@ export class BaseContent extends React.PureComponent {
       this.props.dispatch(ac.SetPref("weather.optInDisplayed", true));
     }
 
+    const novaEnabled = prefs[PREF_NOVA_ENABLED];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
     const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
-    if (wallpapersEnabled) {
+    // Previous values of the wallpaper prefs, used to compare against the
+    // current values and detect what changed since the last render.
+    const prevNovaEnabled = prevProps.Prefs.values[PREF_NOVA_ENABLED];
+    const prevWallpapersSystemEnabled =
+      prevProps.Prefs.values["newtabWallpapers.system.enabled"];
+    const prevWallpapersEnabled =
+      prevProps.Prefs.values["newtabWallpapers.enabled"];
+
+    const isWallpaperActive = novaEnabled
+      ? wallpapersSystemEnabled && wallpapersEnabled
+      : wallpapersSystemEnabled;
+    // This checks if the wallpaper was active before this update so that we can
+    // detect when it just turned off and clear it from the background.
+    const wasWallpaperActive = prevNovaEnabled
+      ? prevWallpapersSystemEnabled && prevWallpapersEnabled
+      : prevWallpapersSystemEnabled;
+
+    if (isWallpaperActive) {
       // destructure current and previous props with fallbacks
       // (preventing undefined errors)
       const {
@@ -313,6 +337,7 @@ export class BaseContent extends React.PureComponent {
 
       // don't update wallpaper unless the wallpaper is being changed.
       if (
+        !wasWallpaperActive || // the wallpaper wasn't active last render but is now, meaning it was just enabled, force an apply even if nothing else changed
         selectedWallpaper !== prevSelectedWallpaper || // selecting a new wallpaper
         initialWallpaper !== prevInitialWallpaper || // experiment sets initial wallpaper
         uploadedWallpaper !== prevUploadedWallpaper || // uploading a new wallpaper
@@ -323,6 +348,9 @@ export class BaseContent extends React.PureComponent {
       ) {
         this.updateWallpaper();
       }
+    } else if (wasWallpaperActive) {
+      // The wallpaper was active last render but isn't anymore, meaning it was just turned off — clear it from the background
+      this.updateWallpaper();
     }
 
     this.spocsOnDemandUpdated();
@@ -525,9 +553,16 @@ export class BaseContent extends React.PureComponent {
 
   async updateWallpaper() {
     const prefs = this.props.Prefs.values;
-    const selectedWallpaper =
-      prefs["newtabWallpapers.wallpaper"] ||
-      prefs["newtabWallpapers.initialWallpaper"];
+    const novaEnabled = prefs[PREF_NOVA_ENABLED];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
+    const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
+    const isWallpaperVisible = novaEnabled
+      ? wallpapersSystemEnabled && wallpapersEnabled
+      : wallpapersSystemEnabled;
+    const selectedWallpaper = isWallpaperVisible
+      ? prefs["newtabWallpapers.wallpaper"] ||
+        prefs["newtabWallpapers.initialWallpaper"]
+      : null;
     const { wallpaperList, uploadedWallpaper: uploadedWallpaperUrl } =
       this.props.Wallpapers;
     const uploadedWallpaperTheme =
@@ -715,6 +750,7 @@ export class BaseContent extends React.PureComponent {
     const activeWallpaper =
       prefs[`newtabWallpapers.wallpaper`] ||
       prefs[`newtabWallpapers.initialWallpaper`];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
     const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
     const weatherEnabled = prefs.showWeather;
     const { showTopicSelection } = DiscoveryStream;
@@ -1018,6 +1054,7 @@ export class BaseContent extends React.PureComponent {
               setPref={this.setPref}
               enabledSections={enabledSections}
               enabledWidgets={enabledWidgets}
+              wallpapersSystemEnabled={wallpapersSystemEnabled}
               wallpapersEnabled={wallpapersEnabled}
               activeWallpaper={activeWallpaper}
               pocketRegion={pocketRegion}
@@ -1141,7 +1178,7 @@ export class BaseContent extends React.PureComponent {
               )}
             </div>
             <ConfirmDialog />
-            {wallpapersEnabled && this.renderWallpaperAttribution()}
+            {wallpapersSystemEnabled && this.renderWallpaperAttribution()}
           </main>
           <aside>
             {this.props.Notifications?.showNotifications && (
@@ -1164,6 +1201,7 @@ export class BaseContent extends React.PureComponent {
             setPref={this.setPref}
             enabledSections={enabledSections}
             enabledWidgets={enabledWidgets}
+            wallpapersSystemEnabled={wallpapersSystemEnabled}
             wallpapersEnabled={wallpapersEnabled}
             activeWallpaper={activeWallpaper}
             pocketRegion={pocketRegion}
diff --git a/browser/extensions/newtab/content-src/components/CustomizeMenu/ContentSection/ContentSection.jsx b/browser/extensions/newtab/content-src/components/CustomizeMenu/ContentSection/ContentSection.jsx
index 025fe87aa334..db1bb4015962 100644
--- a/browser/extensions/newtab/content-src/components/CustomizeMenu/ContentSection/ContentSection.jsx
+++ b/browser/extensions/newtab/content-src/components/CustomizeMenu/ContentSection/ContentSection.jsx
@@ -180,6 +180,7 @@ export class ContentSection extends React.PureComponent {
       showSectionsMgmtPanel,
       // @nova-cleanup(remove-conditional): Remove novaEnabled
       novaEnabled,
+      wallpapersSystemEnabled,
       toggleWidgetsManagementPanel,
       showWidgetsManagementPanel,
       widgetsEnabled,
@@ -207,7 +208,7 @@ export class ContentSection extends React.PureComponent {
     return (
       <>
         <div className="home-section">
-          {(wallpapersEnabled || novaEnabled) && (
+          {wallpapersSystemEnabled && (
             <>
               <div className="wallpapers-section">
                 {novaEnabled && (
@@ -221,14 +222,12 @@ export class ContentSection extends React.PureComponent {
                     data-l10n-id="newtab-wallpaper-toggle-title"
                   />
                 )}
-                {wallpapersEnabled && (
-                  <WallpaperCategories
-                    setPref={setPref}
-                    activeWallpaper={activeWallpaper}
-                    exitEventFired={exitEventFired}
-                    onSubpanelToggle={onSubpanelToggle}
-                  />
-                )}
+                <WallpaperCategories
+                  setPref={setPref}
+                  activeWallpaper={activeWallpaper}
+                  exitEventFired={exitEventFired}
+                  onSubpanelToggle={onSubpanelToggle}
+                />
               </div>
             </>
           )}
diff --git a/browser/extensions/newtab/content-src/components/CustomizeMenu/CustomizeMenu.jsx b/browser/extensions/newtab/content-src/components/CustomizeMenu/CustomizeMenu.jsx
index 6a3d2b685dae..0b96207e475e 100644
--- a/browser/extensions/newtab/content-src/components/CustomizeMenu/CustomizeMenu.jsx
+++ b/browser/extensions/newtab/content-src/components/CustomizeMenu/CustomizeMenu.jsx
@@ -137,6 +137,7 @@ export class _CustomizeMenu extends React.PureComponent {
                 setPref={this.props.setPref}
                 enabledSections={this.props.enabledSections}
                 enabledWidgets={this.props.enabledWidgets}
+                wallpapersSystemEnabled={this.props.wallpapersSystemEnabled}
                 wallpapersEnabled={this.props.wallpapersEnabled}
                 activeWallpaper={this.props.activeWallpaper}
                 pocketRegion={this.props.pocketRegion}
diff --git a/browser/extensions/newtab/content-src/components/CustomizeMenu/_CustomizeMenu.scss b/browser/extensions/newtab/content-src/components/CustomizeMenu/_CustomizeMenu.scss
index e325a5920c28..7d97f34631a6 100644
--- a/browser/extensions/newtab/content-src/components/CustomizeMenu/_CustomizeMenu.scss
+++ b/browser/extensions/newtab/content-src/components/CustomizeMenu/_CustomizeMenu.scss
@@ -710,5 +710,9 @@
   .section #shortcuts-toggle #row-selector {
     width: 100%;
   }
+
+  #wallpapers-toggle {
+    margin-block-end: var(--space-large);
+  }
 }
 
diff --git a/browser/extensions/newtab/content-src/components/WallpaperCategories/WallpaperCategories.jsx b/browser/extensions/newtab/content-src/components/WallpaperCategories/WallpaperCategories.jsx
index 077190b420a4..891992de08d6 100644
--- a/browser/extensions/newtab/content-src/components/WallpaperCategories/WallpaperCategories.jsx
+++ b/browser/extensions/newtab/content-src/components/WallpaperCategories/WallpaperCategories.jsx
@@ -119,6 +119,7 @@ export class _WallpaperCategories extends React.PureComponent {
     // Setting this now so when we remove v1 we don't have to migrate v1 values.
     this.props.setPref("newtabWallpapers.wallpaper", id);
     this.props.setPref("newtabWallpapers.initialWallpaper", "");
+    this.props.setPref("newtabWallpapers.enabled", true);
   }
 
   // Note: There's a separate event (debouncedHandleChange) that fires the handleChange
@@ -134,6 +135,7 @@ export class _WallpaperCategories extends React.PureComponent {
 
     this.props.setPref("newtabWallpapers.wallpaper", id);
     this.props.setPref("newtabWallpapers.initialWallpaper", "");
+    this.props.setPref("newtabWallpapers.enabled", true);
 
     const uploadedPreviously =
       this.props.Prefs.values[PREF_WALLPAPER_UPLOADED_PREVIOUSLY];
@@ -360,6 +362,7 @@ export class _WallpaperCategories extends React.PureComponent {
         // Set active wallpaper ID to "custom"
         this.props.setPref("newtabWallpapers.wallpaper", "custom");
         this.props.setPref("newtabWallpapers.initialWallpaper", "");
+        this.props.setPref("newtabWallpapers.enabled", true);
 
         // Update the uploadedPreviously pref to TRUE
         // Note: this pref used for telemetry. Do not reset to false.
@@ -544,11 +547,16 @@ export class _WallpaperCategories extends React.PureComponent {
             // @nova-cleanup(remove-conditional): Remove h2 once Nova ships — title moves to the wallpaper toggle
             !novaEnabled && <h2 data-l10n-id="newtab-wallpaper-title"></h2>
           }
-          <button
-            className="wallpapers-reset"
-            onClick={this.handleReset}
-            data-l10n-id="newtab-wallpaper-reset"
-          />
+          {
+            // @nova-cleanup(remove-conditional): Remove reset button once Nova ships — toggle handles reset
+            !novaEnabled && (
+              <button
+                className="wallpapers-reset"
+                onClick={this.handleReset}
+                data-l10n-id="newtab-wallpaper-reset"
+              />
+            )
+          }
         </div>
         <div
           role="grid"
diff --git a/browser/extensions/newtab/css/activity-stream.css b/browser/extensions/newtab/css/activity-stream.css
index 3974cfefda35..6cced5ae65b2 100644
--- a/browser/extensions/newtab/css/activity-stream.css
+++ b/browser/extensions/newtab/css/activity-stream.css
@@ -2475,6 +2475,9 @@ main section {
 .nova-enabled .section #shortcuts-toggle #row-selector {
   width: 100%;
 }
+.nova-enabled #wallpapers-toggle {
+  margin-block-end: var(--space-large);
+}
 
 .category-list {
   border: none;
diff --git a/browser/extensions/newtab/css/nova/activity-stream.css b/browser/extensions/newtab/css/nova/activity-stream.css
index a460ef589b6a..17d7004e4e06 100644
--- a/browser/extensions/newtab/css/nova/activity-stream.css
+++ b/browser/extensions/newtab/css/nova/activity-stream.css
@@ -2862,6 +2862,9 @@ main section {
 .nova-enabled .section #shortcuts-toggle #row-selector {
   width: 100%;
 }
+.nova-enabled #wallpapers-toggle {
+  margin-block-end: var(--space-large);
+}
 
 .category-list {
   border: none;
diff --git a/browser/extensions/newtab/data/content/activity-stream.bundle.js b/browser/extensions/newtab/data/content/activity-stream.bundle.js
index 0b798aed081a..c7a230c84450 100644
--- a/browser/extensions/newtab/data/content/activity-stream.bundle.js
+++ b/browser/extensions/newtab/data/content/activity-stream.bundle.js
@@ -15749,6 +15749,7 @@ class _WallpaperCategories extends (external_React_default()).PureComponent {
     // Setting this now so when we remove v1 we don't have to migrate v1 values.
     this.props.setPref("newtabWallpapers.wallpaper", id);
     this.props.setPref("newtabWallpapers.initialWallpaper", "");
+    this.props.setPref("newtabWallpapers.enabled", true);
   }
 
   // Note: There's a separate event (debouncedHandleChange) that fires the handleChange
@@ -15765,6 +15766,7 @@ class _WallpaperCategories extends (external_React_default()).PureComponent {
     }
     this.props.setPref("newtabWallpapers.wallpaper", id);
     this.props.setPref("newtabWallpapers.initialWallpaper", "");
+    this.props.setPref("newtabWallpapers.enabled", true);
     const uploadedPreviously = this.props.Prefs.values[PREF_WALLPAPER_UPLOADED_PREVIOUSLY];
     this.handleUserEvent(actionTypes.WALLPAPER_CLICK, {
       selected_wallpaper: id,
@@ -15960,6 +15962,7 @@ class _WallpaperCategories extends (external_React_default()).PureComponent {
         // Set active wallpaper ID to "custom"
         this.props.setPref("newtabWallpapers.wallpaper", "custom");
         this.props.setPref("newtabWallpapers.initialWallpaper", "");
+        this.props.setPref("newtabWallpapers.enabled", true);
 
         // Update the uploadedPreviously pref to TRUE
         // Note: this pref used for telemetry. Do not reset to false.
@@ -16130,7 +16133,9 @@ class _WallpaperCategories extends (external_React_default()).PureComponent {
       // @nova-cleanup(remove-conditional): Remove h2 once Nova ships — title moves to the wallpaper toggle
       !novaEnabled && /*#__PURE__*/external_React_default().createElement("h2", {
         "data-l10n-id": "newtab-wallpaper-title"
-      }), /*#__PURE__*/external_React_default().createElement("button", {
+      }),
+      // @nova-cleanup(remove-conditional): Remove reset button once Nova ships — toggle handles reset
+      !novaEnabled && /*#__PURE__*/external_React_default().createElement("button", {
         className: "wallpapers-reset",
         onClick: this.handleReset,
         "data-l10n-id": "newtab-wallpaper-reset"
@@ -16649,6 +16654,7 @@ class ContentSection extends (external_React_default()).PureComponent {
       showSectionsMgmtPanel,
       // @nova-cleanup(remove-conditional): Remove novaEnabled
       novaEnabled,
+      wallpapersSystemEnabled,
       toggleWidgetsManagementPanel,
       showWidgetsManagementPanel,
       widgetsEnabled
@@ -16678,7 +16684,7 @@ class ContentSection extends (external_React_default()).PureComponent {
     // @nova-cleanup(remove-conditional): This conditional adds the toggle for wallpaper visibility.
     return /*#__PURE__*/external_React_default().createElement((external_React_default()).Fragment, null, /*#__PURE__*/external_React_default().createElement("div", {
       className: "home-section"
-    }, (wallpapersEnabled || novaEnabled) && /*#__PURE__*/external_React_default().createElement((external_React_default()).Fragment, null, /*#__PURE__*/external_React_default().createElement("div", {
+    }, wallpapersSystemEnabled && /*#__PURE__*/external_React_default().createElement((external_React_default()).Fragment, null, /*#__PURE__*/external_React_default().createElement("div", {
       className: "wallpapers-section"
     }, novaEnabled && /*#__PURE__*/external_React_default().createElement("moz-toggle", {
       id: "wallpapers-toggle",
@@ -16688,7 +16694,7 @@ class ContentSection extends (external_React_default()).PureComponent {
       "data-preference": "newtabWallpapers.enabled",
       "data-event-source": "WALLPAPERS",
       "data-l10n-id": "newtab-wallpaper-toggle-title"
-    }), wallpapersEnabled && /*#__PURE__*/external_React_default().createElement(WallpaperCategories, {
+    }), /*#__PURE__*/external_React_default().createElement(WallpaperCategories, {
       setPref: setPref,
       activeWallpaper: activeWallpaper,
       exitEventFired: exitEventFired,
@@ -17021,6 +17027,7 @@ class _CustomizeMenu extends (external_React_default()).PureComponent {
       setPref: this.props.setPref,
       enabledSections: this.props.enabledSections,
       enabledWidgets: this.props.enabledWidgets,
+      wallpapersSystemEnabled: this.props.wallpapersSystemEnabled,
       wallpapersEnabled: this.props.wallpapersEnabled,
       activeWallpaper: this.props.activeWallpaper,
       pocketRegion: this.props.pocketRegion,
@@ -18653,6 +18660,8 @@ class BaseContent extends (external_React_default()).PureComponent {
     this.applyBodyClasses();
     __webpack_require__.g.addEventListener("scroll", this.onWindowScroll);
     const prefs = this.props.Prefs.values;
+    const novaEnabled = prefs[Base_PREF_NOVA_ENABLED];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
     const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
     if (this.props.document.visibilityState === Base_VISIBLE) {
       this.onVisible();
@@ -18670,7 +18679,8 @@ class BaseContent extends (external_React_default()).PureComponent {
     this.prefersDarkQuery = globalThis.matchMedia("(prefers-color-scheme: dark)");
     this.prefersDarkQuery.addEventListener("change", this.handleColorModeChange);
     this.handleColorModeChange();
-    if (wallpapersEnabled) {
+    const isWallpaperVisible = novaEnabled ? wallpapersSystemEnabled && wallpapersEnabled : wallpapersSystemEnabled;
+    if (isWallpaperVisible) {
       this.updateWallpaper();
     }
     this._onHashChange = () => {
@@ -18707,8 +18717,19 @@ class BaseContent extends (external_React_default()).PureComponent {
       // If weather widget was enabled from customization menu, display opt-in dialog
       this.props.dispatch(actionCreators.SetPref("weather.optInDisplayed", true));
     }
+    const novaEnabled = prefs[Base_PREF_NOVA_ENABLED];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
     const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
-    if (wallpapersEnabled) {
+    // Previous values of the wallpaper prefs, used to compare against the
+    // current values and detect what changed since the last render.
+    const prevNovaEnabled = prevProps.Prefs.values[Base_PREF_NOVA_ENABLED];
+    const prevWallpapersSystemEnabled = prevProps.Prefs.values["newtabWallpapers.system.enabled"];
+    const prevWallpapersEnabled = prevProps.Prefs.values["newtabWallpapers.enabled"];
+    const isWallpaperActive = novaEnabled ? wallpapersSystemEnabled && wallpapersEnabled : wallpapersSystemEnabled;
+    // This checks if the wallpaper was active before this update so that we can
+    // detect when it just turned off and clear it from the background.
+    const wasWallpaperActive = prevNovaEnabled ? prevWallpapersSystemEnabled && prevWallpapersEnabled : prevWallpapersSystemEnabled;
+    if (isWallpaperActive) {
       // destructure current and previous props with fallbacks
       // (preventing undefined errors)
       const {
@@ -18734,7 +18755,9 @@ class BaseContent extends (external_React_default()).PureComponent {
       const prevUploadedWallpaperTheme = prevPrefs["newtabWallpapers.customWallpaper.theme"];
 
       // don't update wallpaper unless the wallpaper is being changed.
-      if (selectedWallpaper !== prevSelectedWallpaper ||
+      if (!wasWallpaperActive ||
+      // the wallpaper wasn't active last render but is now, meaning it was just enabled, force an apply even if nothing else changed
+      selectedWallpaper !== prevSelectedWallpaper ||
       // selecting a new wallpaper
       initialWallpaper !== prevInitialWallpaper ||
       // experiment sets initial wallpaper
@@ -18747,6 +18770,9 @@ class BaseContent extends (external_React_default()).PureComponent {
       uploadedWallpaperTheme !== prevUploadedWallpaperTheme) {
         this.updateWallpaper();
       }
+    } else if (wasWallpaperActive) {
+      // The wallpaper was active last render but isn't anymore, meaning it was just turned off — clear it from the background
+      this.updateWallpaper();
     }
     this.spocsOnDemandUpdated();
     this.trackSpocPlaceholderDuration(prevProps);
@@ -18932,7 +18958,11 @@ class BaseContent extends (external_React_default()).PureComponent {
   }
   async updateWallpaper() {
     const prefs = this.props.Prefs.values;
-    const selectedWallpaper = prefs["newtabWallpapers.wallpaper"] || prefs["newtabWallpapers.initialWallpaper"];
+    const novaEnabled = prefs[Base_PREF_NOVA_ENABLED];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
+    const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
+    const isWallpaperVisible = novaEnabled ? wallpapersSystemEnabled && wallpapersEnabled : wallpapersSystemEnabled;
+    const selectedWallpaper = isWallpaperVisible ? prefs["newtabWallpapers.wallpaper"] || prefs["newtabWallpapers.initialWallpaper"] : null;
     const {
       wallpaperList,
       uploadedWallpaper: uploadedWallpaperUrl
@@ -19078,6 +19108,7 @@ class BaseContent extends (external_React_default()).PureComponent {
     // @nova-cleanup(remove-conditional):
     const novaEnabled = prefs[Base_PREF_NOVA_ENABLED];
     const activeWallpaper = prefs[`newtabWallpapers.wallpaper`] || prefs[`newtabWallpapers.initialWallpaper`];
+    const wallpapersSystemEnabled = prefs["newtabWallpapers.system.enabled"];
     const wallpapersEnabled = prefs["newtabWallpapers.enabled"];
     const weatherEnabled = prefs.showWeather;
     const {
@@ -19215,6 +19246,7 @@ class BaseContent extends (external_React_default()).PureComponent {
         setPref: this.setPref,
         enabledSections: enabledSections,
         enabledWidgets: enabledWidgets,
+        wallpapersSystemEnabled: wallpapersSystemEnabled,
         wallpapersEnabled: wallpapersEnabled,
         activeWallpaper: activeWallpaper,
         pocketRegion: pocketRegion,
@@ -19282,7 +19314,7 @@ class BaseContent extends (external_React_default()).PureComponent {
     }, /*#__PURE__*/external_React_default().createElement(DiscoveryStreamBase, {
       locale: props.App.locale,
       spocsLoading: this.isSpocsOnDemandExpired
-    })) : /*#__PURE__*/external_React_default().createElement(Sections_Sections, null)), /*#__PURE__*/external_React_default().createElement(ConfirmDialog, null), wallpapersEnabled && this.renderWallpaperAttribution()), /*#__PURE__*/external_React_default().createElement("aside", null, this.props.Notifications?.showNotifications && /*#__PURE__*/external_React_default().createElement(ErrorBoundary, null, /*#__PURE__*/external_React_default().createElement(Notifications_Notifications, {
+    })) : /*#__PURE__*/external_React_default().createElement(Sections_Sections, null)), /*#__PURE__*/external_React_default().createElement(ConfirmDialog, null), wallpapersSystemEnabled && this.renderWallpaperAttribution()), /*#__PURE__*/external_React_default().createElement("aside", null, this.props.Notifications?.showNotifications && /*#__PURE__*/external_React_default().createElement(ErrorBoundary, null, /*#__PURE__*/external_React_default().createElement(Notifications_Notifications, {
       dispatch: this.props.dispatch
     }))), mayShowTopicSelection && pocketEnabled && /*#__PURE__*/external_React_default().createElement(TopicSelection, {
       supportUrl: supportUrl
@@ -19295,6 +19327,7 @@ class BaseContent extends (external_React_default()).PureComponent {
       setPref: this.setPref,
       enabledSections: enabledSections,
       enabledWidgets: enabledWidgets,
+      wallpapersSystemEnabled: wallpapersSystemEnabled,
       wallpapersEnabled: wallpapersEnabled,
       activeWallpaper: activeWallpaper,
       pocketRegion: pocketRegion,
diff --git a/browser/extensions/newtab/lib/ActivityStream.sys.mjs b/browser/extensions/newtab/lib/ActivityStream.sys.mjs
index d83246f862ed..5769ba4fc6be 100644
--- a/browser/extensions/newtab/lib/ActivityStream.sys.mjs
+++ b/browser/extensions/newtab/lib/ActivityStream.sys.mjs
@@ -685,9 +685,17 @@ export const PREFS_CONFIG = new Map([
     },
   ],
   [
-    "newtabWallpapers.enabled",
+    "newtabWallpapers.system.enabled",
     {
       title: "Boolean flag to turn wallpaper functionality on and off",
+      value: true,
+    },
+  ],
+  [
+    "newtabWallpapers.enabled",
+    {
+      title:
+        "Boolean flag controlling wallpaper visibility -- if true the user's selected wallpaper is shown, if false it is hidden",
       value: false,
     },
   ],
diff --git a/browser/extensions/newtab/lib/Wallpapers/WallpaperFeed.sys.mjs b/browser/extensions/newtab/lib/Wallpapers/WallpaperFeed.sys.mjs
index 498f8bcf553d..6affbdb22282 100644
--- a/browser/extensions/newtab/lib/Wallpapers/WallpaperFeed.sys.mjs
+++ b/browser/extensions/newtab/lib/Wallpapers/WallpaperFeed.sys.mjs
@@ -14,8 +14,8 @@ import {
   actionCreators as ac,
 } from "resource://newtab/common/Actions.mjs";
 
-const PREF_WALLPAPERS_ENABLED =
-  "browser.newtabpage.activity-stream.newtabWallpapers.enabled";
+const PREF_SYSTEM_WALLPAPERS_ENABLED =
+  "browser.newtabpage.activity-stream.newtabWallpapers.system.enabled";
 
 const PREF_WALLPAPERS_HIGHLIGHT_SEEN_COUNTER =
   "browser.newtabpage.activity-stream.newtabWallpapers.highlightSeenCounter";
@@ -72,7 +72,7 @@ export class WallpaperFeed {
 
   async wallpaperSetup(isStartup = false) {
     const wallpapersEnabled = Services.prefs.getBoolPref(
-      PREF_WALLPAPERS_ENABLED
+      PREF_SYSTEM_WALLPAPERS_ENABLED
     );
 
     if (wallpapersEnabled) {
@@ -342,7 +342,7 @@ export class WallpaperFeed {
         if (
           action.data.name === "newtabWallpapers.customColor.enabled" ||
           action.data.name === "newtabWallpapers.customWallpaper.enabled" ||
-          action.data.name === "newtabWallpapers.enabled"
+          action.data.name === "newtabWallpapers.system.enabled"
         ) {
           this.wallpaperTeardown();
           await this.wallpaperSetup(false /* isStartup */);
diff --git a/browser/extensions/newtab/test/browser/browser.toml b/browser/extensions/newtab/test/browser/browser.toml
index b34ea3f9407b..70f1ed08af5e 100644
--- a/browser/extensions/newtab/test/browser/browser.toml
+++ b/browser/extensions/newtab/test/browser/browser.toml
@@ -20,6 +20,7 @@ prefs = [
   "browser.newtabpage.activity-stream.discoverystream.sections.region-content-config=",
   "messaging-system.log=all",
   "browser.newtabpage.activity-stream.activationWindow.log=true",
+  "browser.newtabpage.activity-stream.newtabWallpapers.system.enabled=false",
 ]
 tags = "newtab"
 
diff --git a/browser/extensions/newtab/test/browser/browser_customize_menu_content.js b/browser/extensions/newtab/test/browser/browser_customize_menu_content.js
index bc095620d16c..1003ff8bbc9d 100644
--- a/browser/extensions/newtab/test/browser/browser_customize_menu_content.js
+++ b/browser/extensions/newtab/test/browser/browser_customize_menu_content.js
@@ -8,6 +8,10 @@ const { WeatherFeed } = ChromeUtils.importESModule(
   "resource://newtab/lib/WeatherFeed.sys.mjs"
 );
 
+const { WallpaperFeed } = ChromeUtils.importESModule(
+  "resource://newtab/lib/Wallpapers/WallpaperFeed.sys.mjs"
+);
+
 const { DiscoveryStreamFeed } = ChromeUtils.importESModule(
   "resource://newtab/lib/DiscoveryStreamFeed.sys.mjs"
 );
@@ -32,6 +36,15 @@ add_setup(async function () {
       "https://example.com/browser/browser/extensions/newtab/test/browser/topstories.json"
     );
 
+  const fakeWallpaperClient = {
+    on: () => {},
+    off: () => {},
+    get: async () => [],
+  };
+  sandbox
+    .stub(WallpaperFeed.prototype, "RemoteSettings")
+    .returns(fakeWallpaperClient);
+
   await SpecialPowers.pushPrefEnv({
     set: [
       [
@@ -275,6 +288,82 @@ test_newtab({
   },
 });
 
+test_newtab({
+  async before({ pushPrefs }) {
+    await pushPrefs(
+      ["browser.newtabpage.activity-stream.nova.enabled", true],
+      [
+        "browser.newtabpage.activity-stream.newtabWallpapers.system.enabled",
+        true,
+      ],
+      ["browser.newtabpage.activity-stream.newtabWallpapers.enabled", false],
+      // Use a solid color so we don't depend on remote settings wallpaper data
+      [
+        "browser.newtabpage.activity-stream.newtabWallpapers.wallpaper",
+        "solid-color-picker-#aabbcc",
+      ]
+    );
+  },
+  test: async function test_render_customizeMenuWallpaper() {
+    const WALLPAPERS_ENABLED_PREF =
+      "browser.newtabpage.activity-stream.newtabWallpapers.enabled";
+
+    function isWallpaperApplied() {
+      return (
+        content.document.body.classList.contains("lightWallpaper") ||
+        content.document.body.classList.contains("darkWallpaper")
+      );
+    }
+
+    await ContentTaskUtils.waitForCondition(
+      () => content.document.querySelector(".personalize-button"),
+      "Wait for prefs button to load on the newtab page"
+    );
+
+    Assert.ok(
+      !Services.prefs.getBoolPref(WALLPAPERS_ENABLED_PREF),
+      "Wallpapers pref defaults to off"
+    );
+    Assert.ok(
+      !isWallpaperApplied(),
+      "Wallpaper is not applied when pref is off"
+    );
+
+    let customizeButton = content.document.querySelector(".personalize-button");
+    customizeButton.click();
+
+    await ContentTaskUtils.waitForCondition(
+      () => content.document.querySelector("#wallpapers-toggle"),
+      "Wallpapers toggle should be present"
+    );
+
+    let wallpapersSwitch = Cu.waiveXrays(
+      content.document.querySelector("#wallpapers-toggle")
+    );
+    Assert.ok(
+      !Services.prefs.getBoolPref(WALLPAPERS_ENABLED_PREF),
+      "Wallpapers pref is still off before clicking toggle"
+    );
+    Assert.ok(!isWallpaperApplied(), "Wallpaper is still not applied");
+
+    let wallpaperAppliedPromise = ContentTaskUtils.waitForCondition(
+      () => isWallpaperApplied(),
+      "Wallpaper should be applied after toggle"
+    );
+    wallpapersSwitch.click();
+    await wallpaperAppliedPromise;
+
+    Assert.ok(
+      isWallpaperApplied(),
+      "Wallpaper is applied after enabling toggle"
+    );
+    Assert.ok(
+      Services.prefs.getBoolPref(WALLPAPERS_ENABLED_PREF),
+      "Wallpapers pref is on after enabling toggle"
+    );
+  },
+});
+
 test_newtab({
   test: async function test_open_close_customizeMenu() {
     const EventUtils = ContentTaskUtils.getEventUtils(content);
diff --git a/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/ContentSection.test.jsx b/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/ContentSection.test.jsx
index e284e4bb5db6..a1eaf5e46a41 100644
--- a/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/ContentSection.test.jsx
+++ b/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/ContentSection.test.jsx
@@ -18,6 +18,7 @@ const DEFAULT_PROPS = {
     widgetsMaximized: false,
     widgetsMayBeMaximized: false,
   },
+  wallpapersSystemEnabled: false,
   wallpapersEnabled: false,
   activeWallpaper: null,
   pocketRegion: false,
diff --git a/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx b/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx
index 557b22817dbf..26fd027422b5 100644
--- a/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx
+++ b/browser/extensions/newtab/test/jest/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx
@@ -22,6 +22,7 @@ const DEFAULT_PROPS = {
     widgetsMaximized: false,
     widgetsMayBeMaximized: false,
   },
+  wallpapersSystemEnabled: false,
   wallpapersEnabled: false,
   activeWallpaper: null,
   pocketRegion: false,
diff --git a/browser/extensions/newtab/test/jest/content-src/components/WallpaperCategories/WallpaperCategories.test.jsx b/browser/extensions/newtab/test/jest/content-src/components/WallpaperCategories/WallpaperCategories.test.jsx
index e7ae096f9854..6fe216f182e1 100644
--- a/browser/extensions/newtab/test/jest/content-src/components/WallpaperCategories/WallpaperCategories.test.jsx
+++ b/browser/extensions/newtab/test/jest/content-src/components/WallpaperCategories/WallpaperCategories.test.jsx
@@ -52,6 +52,31 @@ describe("<WallpaperCategories>", () => {
       "newtabWallpapers.initialWallpaper",
       ""
     );
+    expect(DEFAULT_PROPS.setPref).toHaveBeenCalledWith(
+      "newtabWallpapers.enabled",
+      true
+    );
+  });
+
+  it("should not render the reset button when Nova is enabled", () => {
+    const novaProps = {
+      ...DEFAULT_PROPS,
+      Prefs: {
+        values: {
+          ...DEFAULT_PROPS.Prefs.values,
+          "nova.enabled": true,
+        },
+      },
+    };
+    const { container } = render(<WallpaperCategories {...novaProps} />);
+    expect(
+      container.querySelector(".wallpapers-reset")
+    ).not.toBeInTheDocument();
+  });
+
+  it("should render the reset button when Nova is disabled", () => {
+    const { container } = render(<WallpaperCategories {...DEFAULT_PROPS} />);
+    expect(container.querySelector(".wallpapers-reset")).toBeInTheDocument();
   });
 
   it("should clear initialWallpaper when a custom colour is set", () => {
@@ -70,5 +95,9 @@ describe("<WallpaperCategories>", () => {
       "newtabWallpapers.initialWallpaper",
       ""
     );
+    expect(DEFAULT_PROPS.setPref).toHaveBeenCalledWith(
+      "newtabWallpapers.enabled",
+      true
+    );
   });
 });
diff --git a/browser/extensions/newtab/test/unit/content-src/components/Base.test.jsx b/browser/extensions/newtab/test/unit/content-src/components/Base.test.jsx
index e7eb65704956..0be56296b85e 100644
--- a/browser/extensions/newtab/test/unit/content-src/components/Base.test.jsx
+++ b/browser/extensions/newtab/test/unit/content-src/components/Base.test.jsx
@@ -192,6 +192,168 @@ describe("<BaseContent>", () => {
   });
 });
 
+describe("<BaseContent> wallpaper update logic", () => {
+  const DOCUMENT_STUB = {
+    visibilityState: "visible",
+    addEventListener: sinon.stub(),
+    removeEventListener: sinon.stub(),
+  };
+
+  const makeWallpaperProps = (prefsOverride = {}) => ({
+    store: { getState: () => {} },
+    App: { initialized: true, isForStartupCache: { Wallpaper: false } },
+    Prefs: {
+      values: {
+        "newtabWallpapers.system.enabled": true,
+        "newtabWallpapers.enabled": true,
+        "newtabWallpapers.wallpaper": "beach",
+        "newtabWallpapers.initialWallpaper": "",
+        "newtabWallpapers.customWallpaper.theme": "",
+        "nova.enabled": false,
+        ...prefsOverride,
+      },
+    },
+    Sections: [],
+    DiscoveryStream: { config: { enabled: false }, spocs: {} },
+    Wallpapers: { wallpaperList: [], uploadedWallpaper: null },
+    dispatch: () => {},
+    document: DOCUMENT_STUB,
+  });
+
+  it("should call updateWallpaper when wallpaper is just enabled (wasWallpaperActive false, isWallpaperActive true)", () => {
+    const props = makeWallpaperProps();
+    const wrapper = shallow(<BaseContent {...props} />);
+    const instance = wrapper.instance();
+    const updateSpy = sinon.spy(instance, "updateWallpaper");
+
+    const prevProps = {
+      ...props,
+      Prefs: {
+        values: {
+          ...props.Prefs.values,
+          "newtabWallpapers.system.enabled": false,
+        },
+      },
+    };
+
+    instance.componentDidUpdate(prevProps);
+    assert.calledOnce(updateSpy);
+  });
+
+  it("should call updateWallpaper when wallpaper is just disabled (wasWallpaperActive true, isWallpaperActive false)", () => {
+    const props = makeWallpaperProps({
+      "newtabWallpapers.system.enabled": false,
+    });
+    const wrapper = shallow(<BaseContent {...props} />);
+    const instance = wrapper.instance();
+    const updateSpy = sinon.spy(instance, "updateWallpaper");
+
+    const prevProps = {
+      ...props,
+      Prefs: {
+        values: {
+          ...props.Prefs.values,
+          "newtabWallpapers.system.enabled": true,
+        },
+      },
+    };
+
+    instance.componentDidUpdate(prevProps);
+    assert.calledOnce(updateSpy);
+  });
+
+  it("should call updateWallpaper when the selected wallpaper changes", () => {
+    const props = makeWallpaperProps();
+    const wrapper = shallow(<BaseContent {...props} />);
+    const instance = wrapper.instance();
+    const updateSpy = sinon.spy(instance, "updateWallpaper");
+
+    const prevProps = {
+      ...props,
+      Prefs: {
+        values: {
+          ...props.Prefs.values,
+          "newtabWallpapers.wallpaper": "mountains",
+        },
+      },
+    };
+
+    instance.componentDidUpdate(prevProps);
+    assert.calledOnce(updateSpy);
+  });
+
+  it("should not call updateWallpaper when wallpaper is active but nothing changed", () => {
+    const props = makeWallpaperProps();
+    const wrapper = shallow(<BaseContent {...props} />);
+    const instance = wrapper.instance();
+    const updateSpy = sinon.spy(instance, "updateWallpaper");
+
+    instance.componentDidUpdate(props);
+    assert.notCalled(updateSpy);
+  });
+
+  it("should call updateWallpaper when uploadedWallpaper changes", () => {
+    const props = makeWallpaperProps();
+    const wrapper = shallow(<BaseContent {...props} />);
+    const instance = wrapper.instance();
+    const updateSpy = sinon.spy(instance, "updateWallpaper");
+
+    const prevProps = {
+      ...props,
+      Wallpapers: { wallpaperList: [], uploadedWallpaper: "old-url" },
+    };
+
+    instance.componentDidUpdate(prevProps);
+    assert.calledOnce(updateSpy);
+  });
+
+  it("should call updateWallpaper with Nova when both system and user prefs are enabled", () => {
+    const props = makeWallpaperProps({ "nova.enabled": true });
+    const wrapper = shallow(<BaseContent {...props} />);
+    const instance = wrapper.instance();
+    const updateSpy = sinon.spy(instance, "updateWallpaper");
+
+    const prevProps = {
+      ...props,
+      Prefs: {
+        values: {
+          ...props.Prefs.values,
+          "nova.enabled": true,
+          "newtabWallpapers.wallpaper": "old-wallpaper",
+        },
+      },
+    };
+
+    instance.componentDidUpdate(prevProps);
+    assert.calledOnce(updateSpy);
+  });
+
+  it("should not call updateWallpaper with Nova when user pref is disabled even if system pref is on", () => {
+    const props = makeWallpaperProps({
+      "nova.enabled": true,
+      "newtabWallpapers.enabled": false,
+    });
+    const wrapper = shallow(<BaseContent {...props} />);
+    const instance = wrapper.instance();
+    const updateSpy = sinon.spy(instance, "updateWallpaper");
+
+    const prevProps = {
+      ...props,
+      Prefs: {
+        values: {
+          ...props.Prefs.values,
+          "nova.enabled": true,
+          "newtabWallpapers.enabled": false,
+          "newtabWallpapers.wallpaper": "old-wallpaper",
+        },
+      },
+    };
+
+    instance.componentDidUpdate(prevProps);
+    assert.notCalled(updateSpy);
+  });
+});
+
 function makeASRouterMessages({ position, isVisible = true } = {}) {
   return {
     isVisible,
diff --git a/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/ContentSection.test.jsx b/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/ContentSection.test.jsx
index d8b45f0b0961..65fc94686288 100644
--- a/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/ContentSection.test.jsx
+++ b/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/ContentSection.test.jsx
@@ -12,6 +12,7 @@ const DEFAULT_PROPS = {
   mayHaveWeather: true,
   mayHaveTimerWidget: false,
   mayHaveListsWidget: false,
+  wallpapersSystemEnabled: false,
   wallpapersEnabled: false,
   activeWallpaper: null,
   exitEventFired: false,
@@ -410,6 +411,7 @@ describe("ContentSection", () => {
 
     const NOVA_PROPS = {
       novaEnabled: true,
+      wallpapersSystemEnabled: true,
       toggleWidgetsManagementPanel: sinon.stub(),
       showWidgetsManagementPanel: false,
       onSubpanelToggle: sinon.stub(),
@@ -417,7 +419,7 @@ describe("ContentSection", () => {
 
     it("renders the wallpaper toggle", () => {
       wrapper = mount(
-        <WrapWithProvider>
+        <WrapWithProvider state={WALLPAPER_STATE}>
           <ContentSection
             {...DEFAULT_PROPS}
             {...NOVA_PROPS}
@@ -428,7 +430,20 @@ describe("ContentSection", () => {
       assert.isTrue(wrapper.find("#wallpapers-toggle").exists());
     });
 
-    it("shows WallpaperCategories when the wallpaper toggle is on", () => {
+    it("shows WallpaperCategories regardless of toggle state", () => {
+      wrapper = mount(
+        <WrapWithProvider state={WALLPAPER_STATE}>
+          <ContentSection
+            {...DEFAULT_PROPS}
+            {...NOVA_PROPS}
+            wallpapersEnabled={false}
+          />
+        </WrapWithProvider>
+      );
+      assert.isTrue(wrapper.find(".category-list").exists());
+    });
+
+    it("sets newtabWallpapers.enabled to false when the wallpaper toggle is turned off", () => {
       wrapper = mount(
         <WrapWithProvider state={WALLPAPER_STATE}>
           <ContentSection
@@ -438,12 +453,29 @@ describe("ContentSection", () => {
           />
         </WrapWithProvider>
       );
-      assert.isTrue(wrapper.find(".category-list").exists());
+      wrapper
+        .find(ContentSection)
+        .instance()
+        .onPreferenceSelect({
+          target: {
+            nodeName: "MOZ-TOGGLE",
+            pressed: false,
+            dataset: {
+              preference: "newtabWallpapers.enabled",
+              eventSource: "WALLPAPERS",
+            },
+          },
+        });
+      assert.calledWith(
+        DEFAULT_PROPS.setPref,
+        "newtabWallpapers.enabled",
+        false
+      );
     });
 
-    it("hides WallpaperCategories when the wallpaper toggle is off", () => {
+    it("sets newtabWallpapers.enabled to true when the wallpaper toggle is turned on", () => {
       wrapper = mount(
-        <WrapWithProvider>
+        <WrapWithProvider state={WALLPAPER_STATE}>
           <ContentSection
             {...DEFAULT_PROPS}
             {...NOVA_PROPS}
@@ -451,13 +483,30 @@ describe("ContentSection", () => {
           />
         </WrapWithProvider>
       );
-      assert.isFalse(wrapper.find(".category-list").exists());
+      wrapper
+        .find(ContentSection)
+        .instance()
+        .onPreferenceSelect({
+          target: {
+            nodeName: "MOZ-TOGGLE",
+            pressed: true,
+            dataset: {
+              preference: "newtabWallpapers.enabled",
+              eventSource: "WALLPAPERS",
+            },
+          },
+        });
+      assert.calledWith(
+        DEFAULT_PROPS.setPref,
+        "newtabWallpapers.enabled",
+        true
+      );
     });
 
     // @nova-cleanup(remove-conditional): Remove the `.widgets-section` assertion once the novaEnabled condition is removed
     it("renders WidgetsManagementPanel instead of .widgets-section when novaEnabled and mayHaveWidgets are true", () => {
       wrapper = mount(
-        <WrapWithProvider>
+        <WrapWithProvider state={WALLPAPER_STATE}>
           <ContentSection
             {...DEFAULT_PROPS}
             {...NOVA_PROPS}
@@ -472,7 +521,7 @@ describe("ContentSection", () => {
     describe("widgets system toggle", () => {
       it("renders the widgets system toggle in ContentSection", () => {
         wrapper = mount(
-          <WrapWithProvider>
+          <WrapWithProvider state={WALLPAPER_STATE}>
             <ContentSection
               {...DEFAULT_PROPS}
               {...NOVA_PROPS}
@@ -486,7 +535,7 @@ describe("ContentSection", () => {
 
       it("sets widgets-system-toggle pressed when widgetsEnabled is true", () => {
         wrapper = mount(
-          <WrapWithProvider>
+          <WrapWithProvider state={WALLPAPER_STATE}>
             <ContentSection
               {...DEFAULT_PROPS}
               {...NOVA_PROPS}
@@ -500,7 +549,7 @@ describe("ContentSection", () => {
 
       it("sets widgets-system-toggle unpressed when widgetsEnabled is false", () => {
         wrapper = mount(
-          <WrapWithProvider>
+          <WrapWithProvider state={WALLPAPER_STATE}>
             <ContentSection
               {...DEFAULT_PROPS}
               {...NOVA_PROPS}
diff --git a/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx b/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx
index 9d5eba059a29..710d353c22e7 100644
--- a/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx
+++ b/browser/extensions/newtab/test/unit/content-src/components/CustomizeMenu/CustomizeMenu.test.jsx
@@ -127,6 +127,7 @@ describe("<CustomizeMenu>", () => {
       mayHaveWidgets: true,
       mayHaveTimerWidget: true,
       mayHaveListsWidget: true,
+      wallpapersSystemEnabled: true,
       wallpapersEnabled: true,
       enabledWidgets: { timerEnabled: true, listsEnabled: true },
     };
@@ -141,6 +142,7 @@ describe("<CustomizeMenu>", () => {
     assert.strictEqual(child.prop("mayHaveWidgets"), true);
     assert.strictEqual(child.prop("mayHaveTimerWidget"), true);
     assert.strictEqual(child.prop("mayHaveListsWidget"), true);
+    assert.strictEqual(child.prop("wallpapersSystemEnabled"), true);
     assert.strictEqual(child.prop("wallpapersEnabled"), true);
     assert.deepEqual(child.prop("enabledWidgets"), {
       timerEnabled: true,
diff --git a/browser/extensions/newtab/test/xpcshell/test_AboutHomeStartupCacheWorker.js b/browser/extensions/newtab/test/xpcshell/test_AboutHomeStartupCacheWorker.js
index c5f6ca2bf34a..418a291d92fb 100644
--- a/browser/extensions/newtab/test/xpcshell/test_AboutHomeStartupCacheWorker.js
+++ b/browser/extensions/newtab/test/xpcshell/test_AboutHomeStartupCacheWorker.js
@@ -72,7 +72,7 @@ add_setup(async function () {
     ""
   );
   Services.prefs.setBoolPref(
-    "browser.newtabpage.activity-stream.newtabWallpapers.enabled",
+    "browser.newtabpage.activity-stream.newtabWallpapers.system.enabled",
     false
   );
 
diff --git a/browser/extensions/newtab/test/xpcshell/test_WallpaperFeed.js b/browser/extensions/newtab/test/xpcshell/test_WallpaperFeed.js
index a1bcbafa37f2..733e8cdfc9d9 100644
--- a/browser/extensions/newtab/test/xpcshell/test_WallpaperFeed.js
+++ b/browser/extensions/newtab/test/xpcshell/test_WallpaperFeed.js
@@ -12,8 +12,8 @@ ChromeUtils.defineESModuleGetters(this, {
   WallpaperFeed: "resource://newtab/lib/Wallpapers/WallpaperFeed.sys.mjs",
 });
 
-const PREF_WALLPAPERS_ENABLED =
-  "browser.newtabpage.activity-stream.newtabWallpapers.enabled";
+const PREF_SYSTEM_WALLPAPERS_ENABLED =
+  "browser.newtabpage.activity-stream.newtabWallpapers.system.enabled";
 
 const PREF_WALLPAPERS_CUSTOM_WALLPAPER_UUID =
   "browser.newtabpage.activity-stream.newtabWallpapers.customWallpaper.uuid";
@@ -45,7 +45,7 @@ add_task(async function test_construction() {
 add_task(async function test_onAction_INIT() {
   let sandbox = sinon.createSandbox();
   let feed = new WallpaperFeed();
-  Services.prefs.setBoolPref(PREF_WALLPAPERS_ENABLED, true);
+  Services.prefs.setBoolPref(PREF_SYSTEM_WALLPAPERS_ENABLED, true);
   const attachment = {
     attachment: {
       location: "attachment",
@@ -95,27 +95,27 @@ add_task(async function test_onAction_INIT() {
     })
   );
 
-  Services.prefs.clearUserPref(PREF_WALLPAPERS_ENABLED);
+  Services.prefs.clearUserPref(PREF_SYSTEM_WALLPAPERS_ENABLED);
   sandbox.restore();
 });
 
 add_task(async function test_onAction_PREF_CHANGED() {
   let sandbox = sinon.createSandbox();
   let feed = new WallpaperFeed();
-  Services.prefs.setBoolPref(PREF_WALLPAPERS_ENABLED, true);
+  Services.prefs.setBoolPref(PREF_SYSTEM_WALLPAPERS_ENABLED, true);
   sandbox.stub(feed, "wallpaperSetup").returns();
 
   info("WallpaperFeed.onAction PREF_CHANGED should call wallpaperSetup");
 
   feed.onAction({
     type: actionTypes.PREF_CHANGED,
-    data: { name: "newtabWallpapers.enabled" },
+    data: { name: "newtabWallpapers.system.enabled" },
   });
 
   Assert.ok(feed.wallpaperSetup.calledOnce);
   Assert.ok(feed.wallpaperSetup.calledWith(false));
 
-  Services.prefs.clearUserPref(PREF_WALLPAPERS_ENABLED);
+  Services.prefs.clearUserPref(PREF_SYSTEM_WALLPAPERS_ENABLED);
   sandbox.restore();
 });
 
@@ -124,7 +124,7 @@ add_task(async function test_onAction_WALLPAPER_UPLOAD() {
   let feed = new WallpaperFeed();
   const fileData = {};
 
-  Services.prefs.setBoolPref(PREF_WALLPAPERS_ENABLED, true);
+  Services.prefs.setBoolPref(PREF_SYSTEM_WALLPAPERS_ENABLED, true);
   sandbox.stub(feed, "wallpaperUpload").returns();
 
   info("WallpaperFeed.onAction WALLPAPER_UPLOAD should call wallpaperUpload");
@@ -137,7 +137,7 @@ add_task(async function test_onAction_WALLPAPER_UPLOAD() {
   Assert.ok(feed.wallpaperUpload.calledOnce);
   Assert.ok(feed.wallpaperUpload.calledWith(fileData));
 
-  Services.prefs.clearUserPref(PREF_WALLPAPERS_ENABLED);
+  Services.prefs.clearUserPref(PREF_SYSTEM_WALLPAPERS_ENABLED);
 
   sandbox.restore();
 });
@@ -205,7 +205,7 @@ add_task(async function test_Wallpaper_Upload() {
 add_task(async function test_updateWallpapers_category_order() {
   let sandbox = sinon.createSandbox();
   let feed = new WallpaperFeed();
-  Services.prefs.setBoolPref(PREF_WALLPAPERS_ENABLED, true);
+  Services.prefs.setBoolPref(PREF_SYSTEM_WALLPAPERS_ENABLED, true);
   Services.prefs.setBoolPref(
     "browser.newtabpage.activity-stream.newtabWallpapers.customWallpaper.enabled",
     true
@@ -249,7 +249,7 @@ add_task(async function test_updateWallpapers_category_order() {
     "solid-colors",
   ]);
 
-  Services.prefs.clearUserPref(PREF_WALLPAPERS_ENABLED);
+  Services.prefs.clearUserPref(PREF_SYSTEM_WALLPAPERS_ENABLED);
   Services.prefs.clearUserPref(
     "browser.newtabpage.activity-stream.newtabWallpapers.customWallpaper.enabled"
   );
@@ -259,7 +259,7 @@ add_task(async function test_updateWallpapers_category_order() {
 add_task(async function test_onAction_PREF_CHANGED_customColor() {
   let sandbox = sinon.createSandbox();
   let feed = new WallpaperFeed();
-  Services.prefs.setBoolPref(PREF_WALLPAPERS_ENABLED, true);
+  Services.prefs.setBoolPref(PREF_SYSTEM_WALLPAPERS_ENABLED, true);
   sandbox.stub(feed, "wallpaperTeardown").returns();
   sandbox.stub(feed, "wallpaperSetup").returns();
 
@@ -286,7 +286,7 @@ add_task(async function test_onAction_PREF_CHANGED_customColor() {
     "wallpaperSetup should be called with isStartup=false"
   );
 
-  Services.prefs.clearUserPref(PREF_WALLPAPERS_ENABLED);
+  Services.prefs.clearUserPref(PREF_SYSTEM_WALLPAPERS_ENABLED);
   sandbox.restore();
 });
 
diff --git a/testing/profiles/common/user.js b/testing/profiles/common/user.js
index 44b07921641a..1fc5fbd0273a 100644
--- a/testing/profiles/common/user.js
+++ b/testing/profiles/common/user.js
@@ -76,6 +76,7 @@ user_pref("browser.topsites.contile.enabled", false);
 // Don't pull weather data from the network
 user_pref("browser.newtabpage.activity-stream.system.showWeather", false);
 // Don't pull wallpaper content from the network
+user_pref("browser.newtabpage.activity-stream.newtabWallpapers.system.enabled", false);
 user_pref("browser.newtabpage.activity-stream.newtabWallpapers.enabled", false);
 // Don't pull sponsored Top Sites content from the network
 user_pref("browser.newtabpage.activity-stream.showSponsoredTopSites", false);