diff --git a/Cargo.toml b/Cargo.toml
index 7dda86c8f1418..a9aaa9fa94a3f 100644
--- a/Cargo.toml
+++ b/Cargo.toml
@@ -4591,6 +4591,18 @@ description = "Demonstrates picking debug overlay"
 category = "Picking"
 wasm = true
 
+[[example]]
+name = "dragdrop_picking"
+path = "examples/picking/dragdrop_picking.rs"
+doc-scrape-examples = true
+required-features = ["mesh_picking"]
+
+[package.metadata.example.dragdrop_picking]
+name = "Drag and Drop"
+description = "Demonstrates drag and drop using picking events"
+category = "Picking"
+wasm = true
+
 [[example]]
 name = "animation_masks"
 path = "examples/animation/animation_masks.rs"
diff --git a/examples/README.md b/examples/README.md
index da86eac2fbdc1..7215a97b11935 100644
--- a/examples/README.md
+++ b/examples/README.md
@@ -416,6 +416,7 @@ Example | Description
 
 Example | Description
 --- | ---
+[Drag and Drop](../examples/picking/dragdrop_picking.rs) | Demonstrates drag and drop using picking events
 [Mesh Picking](../examples/picking/mesh_picking.rs) | Demonstrates picking meshes
 [Picking Debug Tools](../examples/picking/debug_picking.rs) | Demonstrates picking debug overlay
 [Showcases simple picking events and usage](../examples/picking/simple_picking.rs) | Demonstrates how to use picking events to spawn simple objects
diff --git a/examples/picking/dragdrop_picking.rs b/examples/picking/dragdrop_picking.rs
new file mode 100644
index 0000000000000..62718ffd4c1ce
--- /dev/null
+++ b/examples/picking/dragdrop_picking.rs
@@ -0,0 +1,172 @@
+//! Demonstrates drag and drop functionality using picking events.
+
+use bevy::prelude::*;
+
+#[derive(Component)]
+struct DropArea;
+
+#[derive(Component)]
+struct DraggableButton;
+
+#[derive(Component)]
+struct GhostPreview;
+
+#[derive(Component)]
+struct DroppedElement;
+
+const AREA_SIZE: f32 = 500.0;
+const BUTTON_WIDTH: f32 = 150.0;
+const BUTTON_HEIGHT: f32 = 50.0;
+const ELEMENT_SIZE: f32 = 25.0;
+
+fn main() {
+    App::new()
+        .add_plugins((DefaultPlugins, MeshPickingPlugin))
+        .add_systems(Startup, setup)
+        .run();
+}
+
+fn setup(
+    mut commands: Commands,
+    mut meshes: ResMut<Assets<Mesh>>,
+    mut materials: ResMut<Assets<ColorMaterial>>,
+) {
+    commands.spawn(Camera2d);
+
+    commands
+        .spawn((
+            Node {
+                width: Val::Percent(100.0),
+                height: Val::Percent(100.0),
+                align_items: AlignItems::Center,
+                justify_content: JustifyContent::Start,
+                ..default()
+            },
+            Pickable::IGNORE,
+        ))
+        .with_children(|parent| {
+            parent
+                .spawn((
+                    DraggableButton,
+                    Node {
+                        width: Val::Px(BUTTON_WIDTH),
+                        height: Val::Px(BUTTON_HEIGHT),
+                        margin: UiRect::all(Val::Px(10.0)),
+                        justify_content: JustifyContent::Center,
+                        align_items: AlignItems::Center,
+                        ..default()
+                    },
+                    BackgroundColor(Color::srgb(1.0, 0.0, 0.0)),
+                ))
+                .with_child((
+                    Text::new("Drag from me"),
+                    TextColor(Color::WHITE),
+                    Pickable::IGNORE,
+                ))
+                .observe(
+                    |mut event: On<Pointer<DragStart>>,
+                     mut button_color: Single<&mut BackgroundColor, With<DraggableButton>>| {
+                        button_color.0 = Color::srgb(1.0, 0.5, 0.0);
+                        event.propagate(false);
+                    },
+                )
+                .observe(
+                    |mut event: On<Pointer<DragEnd>>,
+                     mut button_color: Single<&mut BackgroundColor, With<DraggableButton>>| {
+                        button_color.0 = Color::srgb(1.0, 0.0, 0.0);
+                        event.propagate(false);
+                    },
+                );
+        });
+
+    commands
+        .spawn((
+            DropArea,
+            Mesh2d(meshes.add(Rectangle::new(AREA_SIZE, AREA_SIZE))),
+            MeshMaterial2d(materials.add(Color::srgb(0.1, 0.4, 0.1))),
+            Transform::IDENTITY,
+            children![(
+                Text2d::new("Drop here"),
+                TextFont::from_font_size(50.),
+                TextColor(Color::BLACK),
+                Pickable::IGNORE,
+                Transform::from_translation(Vec3::Z),
+            )],
+        ))
+        .observe(on_drag_enter)
+        .observe(on_drag_over)
+        .observe(on_drag_drop)
+        .observe(on_drag_leave);
+}
+
+fn on_drag_enter(
+    mut event: On<Pointer<DragEnter>>,
+    button: Single<Entity, With<DraggableButton>>,
+    mut commands: Commands,
+    mut meshes: ResMut<Assets<Mesh>>,
+    mut materials: ResMut<Assets<ColorMaterial>>,
+) {
+    if event.dragged == *button {
+        let Some(position) = event.hit.position else {
+            return;
+        };
+        commands.spawn((
+            GhostPreview,
+            Mesh2d(meshes.add(Circle::new(ELEMENT_SIZE))),
+            MeshMaterial2d(materials.add(Color::srgba(1.0, 1.0, 0.6, 0.5))),
+            Transform::from_translation(position + 2. * Vec3::Z),
+            Pickable::IGNORE,
+        ));
+        event.propagate(false);
+    }
+}
+
+fn on_drag_over(
+    mut event: On<Pointer<DragOver>>,
+    button: Single<Entity, With<DraggableButton>>,
+    mut ghost_transform: Single<&mut Transform, With<GhostPreview>>,
+) {
+    if event.dragged == *button {
+        let Some(position) = event.hit.position else {
+            return;
+        };
+        ghost_transform.translation = position;
+        event.propagate(false);
+    }
+}
+
+fn on_drag_drop(
+    mut event: On<Pointer<DragDrop>>,
+    button: Single<Entity, With<DraggableButton>>,
+    mut commands: Commands,
+    ghost: Single<Entity, With<GhostPreview>>,
+    mut meshes: ResMut<Assets<Mesh>>,
+    mut materials: ResMut<Assets<ColorMaterial>>,
+) {
+    if event.dropped == *button {
+        commands.entity(*ghost).despawn();
+        let Some(position) = event.hit.position else {
+            return;
+        };
+        commands.spawn((
+            DroppedElement,
+            Mesh2d(meshes.add(Circle::new(ELEMENT_SIZE))),
+            MeshMaterial2d(materials.add(Color::srgb(1.0, 1.0, 0.6))),
+            Transform::from_translation(position + 2. * Vec3::Z),
+            Pickable::IGNORE,
+        ));
+        event.propagate(false);
+    }
+}
+
+fn on_drag_leave(
+    mut event: On<Pointer<DragLeave>>,
+    button: Single<Entity, With<DraggableButton>>,
+    mut commands: Commands,
+    ghost: Single<Entity, With<GhostPreview>>,
+) {
+    if event.dragged == *button {
+        commands.entity(*ghost).despawn();
+        event.propagate(false);
+    }
+}