diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.scss b/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.scss
index a64e52f2aa..05b26b4b07 100644
--- a/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.scss
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.scss
@@ -69,15 +69,21 @@
         padding-bottom: $space_xs;
         cursor: pointer;
         &:hover {
-          background-color: $border_light;
+          background-color: $bg_light;
         }
 
         &[class*="_focused"] {
-          background-color: $border_light;
+          background-color: $bg_light;
         }
 
         &[class*="_list"] {
           border-bottom: 1px solid $border_light;
+
+          &:hover, &:focus {
+            .pb_body_kit {
+              color: $primary;
+            }
+          }
         }
         &[class*="selected"] {
           background-color: $primary;
@@ -87,7 +93,7 @@
             color: $white !important;
           }
           &:hover {
-            background-color: $primary !important;
+            background-color: $product_1_background !important;
           }
         }
       }
@@ -125,6 +131,81 @@
     }
   }
 
+  &.separators_hidden {
+    .dropdown_wrapper {
+      .pb_dropdown_container {
+
+        [class*="pb_dropdown_option"] {
+          border: none;
+        }
+      }
+    }
+  }
+
+  &.subtle {
+    .dropdown_wrapper {
+      .pb_dropdown_container {
+        
+        [class*="pb_dropdown_option"]:first-child {
+          margin-top: $space_xs;
+        }
+
+        [class*="pb_dropdown_option"]:last-child {
+          margin-bottom: $space_xs;
+        }
+
+        [class*="pb_dropdown_option"] {
+          margin: $space_xs;
+          padding: $space_xs;
+          border-radius: $border_radius_md;
+          border-bottom: none;
+          position: relative;
+        
+          &::after {
+            content: "";
+            position: absolute;
+            left: -$space_xs;
+            right: -$space_xs;
+            bottom: -4.5px;
+            height: 1px;
+            background: $border_light;
+          }
+        }
+        
+        [class*="pb_dropdown_option"]:last-child::after {
+          display: none; 
+        }
+      }
+    }
+  
+    &.separators_hidden {
+      .dropdown_wrapper {
+        .pb_dropdown_container {
+          [class*="pb_dropdown_option"]:first-child {
+            margin-top: $space_xs;
+          }
+  
+          [class*="pb_dropdown_option"]:last-child {
+            margin-bottom: $space_xs;
+          }
+
+          [class*="pb_dropdown_option"] {
+            padding: $space_xxs $space_xs;
+            margin: $space_xxs $space_xs;
+     
+            &::after {
+              height: 0px;
+            }
+
+            &[class*="selected"] {
+              border-bottom: none;
+            }
+          }
+        }
+      }
+    }
+  }
+
   &.dark {
     .dropdown_wrapper {
       [class*="dropdown_trigger_wrapper"] {
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.tsx b/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.tsx
index 27234c3fec..28af6eb76a 100644
--- a/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.tsx
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/_dropdown.tsx
@@ -35,7 +35,9 @@ type DropdownProps = {
     label?: string;
     onSelect?: (arg: GenericObject) => null;
     options: GenericObject;
+    separators: boolean;
     triggerRef?: any;
+    variant?: "default" | "subtle";
 };
 
 interface DropdownComponent
@@ -62,15 +64,20 @@ const Dropdown = forwardRef((props: DropdownProps, ref: any) => {
         label,
         onSelect,
         options,
-        triggerRef
+        separators = true,
+        triggerRef,
+        variant = "default",
     } = props;
 
     const ariaProps = buildAriaProps(aria);
     const dataProps = buildDataProps(data);
     const htmlProps = buildHtmlProps(htmlOptions);
+    const separatorsClass = separators ? '' : 'separators_hidden'
     const classes = classnames(
         buildCss("pb_dropdown"),
         globalProps(props),
+        variant,
+        separatorsClass,
         className
     );
 
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_separators_hidden.html.erb b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_separators_hidden.html.erb
new file mode 100644
index 0000000000..98d2b41939
--- /dev/null
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_separators_hidden.html.erb
@@ -0,0 +1,9 @@
+<% 
+  options = [
+    { label: 'United States', value: 'United States', id: 'us' },
+    { label: 'Canada', value: 'Canada', id: 'ca' },
+    { label: 'Pakistan', value: 'Pakistan', id: 'pk' },
+  ]
+
+%>
+<%= pb_rails("dropdown", props: {options: options, separators: false}) %>
\ No newline at end of file
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_separators_hidden.jsx b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_separators_hidden.jsx
new file mode 100644
index 0000000000..053c60e339
--- /dev/null
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_separators_hidden.jsx
@@ -0,0 +1,33 @@
+import React from 'react'
+import { Dropdown } from 'playbook-ui'
+
+const DropdownSeparatorsHidden = (props) => {
+
+  const options = [
+    {
+      label: "United States",
+      value: "United States",
+    },
+    {
+      label: "Canada",
+      value: "Canada",
+    },
+    {
+      label: "Pakistan",
+      value: "Pakistan",
+    }
+  ];  
+
+
+  return (
+  <div>
+    <Dropdown
+        options={options}
+        separators={false}
+        {...props}
+    />
+  </div>
+  )
+}
+
+export default DropdownSeparatorsHidden
\ No newline at end of file
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.html.erb b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.html.erb
new file mode 100644
index 0000000000..8e37f2390f
--- /dev/null
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.html.erb
@@ -0,0 +1,10 @@
+<% 
+  options = [
+    { label: 'United States', value: 'United States', id: 'us' },
+    { label: 'Canada', value: 'Canada', id: 'ca' },
+    { label: 'Pakistan', value: 'Pakistan', id: 'pk' },
+  ]
+
+%>
+
+<%= pb_rails("dropdown", props: { options: options, variant: "subtle", separators: false }) %>
\ No newline at end of file
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.jsx b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.jsx
new file mode 100644
index 0000000000..e2686d36b3
--- /dev/null
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.jsx
@@ -0,0 +1,34 @@
+import React from 'react'
+import { Dropdown } from 'playbook-ui'
+
+const DropdownSubtleVariant = (props) => {
+
+  const options = [
+    {
+      label: "United States",
+      value: "United States",
+    },
+    {
+      label: "Canada",
+      value: "Canada",
+    },
+    {
+      label: "Pakistan",
+      value: "Pakistan",
+    }
+  ];  
+
+
+  return (
+  <>
+     <Dropdown
+         options={options}
+         separators={false}
+         variant="subtle"
+         {...props}
+    />
+  </>
+  )
+}
+
+export default DropdownSubtleVariant
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.md b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.md
new file mode 100644
index 0000000000..723805e823
--- /dev/null
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/docs/_dropdown_subtle_variant.md
@@ -0,0 +1 @@
+For the `subtle` variant, it is recommended that you set the `Separators` prop to `false` to remove the separator lines between the options for a more cleaner look.
\ No newline at end of file
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/docs/example.yml b/playbook/app/pb_kits/playbook/pb_dropdown/docs/example.yml
index f707a2907c..5a88bb3075 100644
--- a/playbook/app/pb_kits/playbook/pb_dropdown/docs/example.yml
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/docs/example.yml
@@ -1,6 +1,7 @@
 examples:
   rails:
   - dropdown_default: Default
+  - dropdown_subtle_variant: Subtle Variant
   - dropdown_subcomponent_structure_rails: Subcomponent Structure
   - dropdown_with_label: With Label
   - dropdown_with_custom_options_rails: Custom Options
@@ -10,9 +11,11 @@ examples:
   - dropdown_error: Dropdown with Error
   - dropdown_default_value: Default Value
   - dropdown_blank_selection: Blank Selection
+  - dropdown_separators_hidden: Separators Hidden
 
   react:
   - dropdown_default: Default
+  - dropdown_subtle_variant: Subtle Variant
   - dropdown_subcomponent_structure: Subcomponent Structure
   - dropdown_with_label: With Label
   - dropdown_with_custom_options: Custom Options
@@ -23,6 +26,7 @@ examples:
   - dropdown_default_value: Default Value
   - dropdown_blank_selection: Blank Selection
   - dropdown_clear_selection: Clear Selection
+  - dropdown_separators_hidden: Separators Hidden
   # - dropdown_with_autocomplete: Autocomplete
   # - dropdown_with_autocomplete_and_custom_display: Autocomplete with Custom Display
   # - dropdown_with_external_control: useDropdown Hook
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/docs/index.js b/playbook/app/pb_kits/playbook/pb_dropdown/docs/index.js
index e246c75bf3..6753fe53cb 100644
--- a/playbook/app/pb_kits/playbook/pb_dropdown/docs/index.js
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/docs/index.js
@@ -13,3 +13,5 @@ export { default as DropdownError } from './_dropdown_error.jsx'
 export { default as DropdownDefaultValue } from './_dropdown_default_value.jsx'
 export { default as DropdownBlankSelection } from './_dropdown_blank_selection.jsx'
 export { default as DropdownClearSelection } from './_dropdown_clear_selection.jsx'
+export { default as DropdownSubtleVariant } from './_dropdown_subtle_variant.jsx'
+export { default as DropdownSeparatorsHidden } from './_dropdown_separators_hidden.jsx'
diff --git a/playbook/app/pb_kits/playbook/pb_dropdown/dropdown.rb b/playbook/app/pb_kits/playbook/pb_dropdown/dropdown.rb
index 4f839b17f0..30e6cbd2f5 100644
--- a/playbook/app/pb_kits/playbook/pb_dropdown/dropdown.rb
+++ b/playbook/app/pb_kits/playbook/pb_dropdown/dropdown.rb
@@ -13,13 +13,18 @@ class Dropdown < Playbook::KitBase
       prop :default_value
       prop :blank_selection, type: Playbook::Props::String,
                              default: ""
+      prop :variant, type: Playbook::Props::Enum,
+                     values: %w[default subtle],
+                     default: "default"
+      prop :separators, type: Playbook::Props::Boolean,
+                        default: true
 
       def data
         Hash(prop(:data)).merge(pb_dropdown: true)
       end
 
       def classname
-        generate_classname("pb_dropdown")
+        generate_classname("pb_dropdown", variant, separators_class, separator: " ")
       end
 
     private
@@ -32,6 +37,10 @@ def input_default_value
         default_value.present? ? default_value.transform_keys(&:to_s)["id"] : ""
       end
 
+      def separators_class
+        separators ? "" : "separators_hidden"
+      end
+
       def options_with_blank
         blank_selection.present? ? [{ id: "", value: "", label: blank_selection }] + options : options
       end