diff --git a/change/@fluentui-react-theme-95bba881-0421-4475-bde5-0bbadf341b4b.json b/change/@fluentui-react-theme-95bba881-0421-4475-bde5-0bbadf341b4b.json
new file mode 100644
index 0000000000000..e0ba02da262a6
--- /dev/null
+++ b/change/@fluentui-react-theme-95bba881-0421-4475-bde5-0bbadf341b4b.json
@@ -0,0 +1,7 @@
+{
+  "type": "none",
+  "comment": "update tooling configs",
+  "packageName": "@fluentui/react-theme",
+  "email": "olfedias@microsoft.com",
+  "dependentChangeType": "none"
+}
diff --git a/packages/react-theme/.npmignore b/packages/react-theme/.npmignore
index fa2d3a7f5111c..e719afb921bc9 100644
--- a/packages/react-theme/.npmignore
+++ b/packages/react-theme/.npmignore
@@ -1,4 +1,3 @@
-.cache/
 .storybook/
 .vscode/
 bundle-size/
diff --git a/packages/react-theme/.storybook/main.js b/packages/react-theme/.storybook/main.js
index ec377d98606fa..18a60b265c2cf 100644
--- a/packages/react-theme/.storybook/main.js
+++ b/packages/react-theme/.storybook/main.js
@@ -1,12 +1,14 @@
 const rootMain = require('../../../.storybook/main');
 
-module.exports = /** @type {Pick<import('../../../.storybook/main').StorybookConfig,'addons'|'stories'|'webpackFinal'>} */ ({
+module.exports = /** @type {Omit<import('../../../.storybook/main'), 'typescript'|'babel'>} */ ({
+  ...rootMain,
   stories: [...rootMain.stories, '../src/**/*.stories.mdx', '../src/**/*.stories.@(ts|tsx)'],
   addons: [...rootMain.addons],
   webpackFinal: (config, options) => {
     const localConfig = { ...rootMain.webpackFinal(config, options) };
 
+    // add your own webpack tweaks if needed
+
     return localConfig;
   },
-  previewHead: rootMain.previewHead,
 });
diff --git a/packages/react-theme/.storybook/preview.js b/packages/react-theme/.storybook/preview.js
index b52409294c330..10fd98d02c945 100644
--- a/packages/react-theme/.storybook/preview.js
+++ b/packages/react-theme/.storybook/preview.js
@@ -1,3 +1,7 @@
 import * as rootPreview from '../../../.storybook/preview';
 
+/** @type {typeof rootPreview.decorators} */
 export const decorators = [...rootPreview.decorators];
+
+/** @type {typeof rootPreview.parameters} */
+export const parameters = { ...rootPreview.parameters };
diff --git a/packages/react-theme/.storybook/tsconfig.json b/packages/react-theme/.storybook/tsconfig.json
index 3bd9adcd2ee05..29aa16f2f178f 100644
--- a/packages/react-theme/.storybook/tsconfig.json
+++ b/packages/react-theme/.storybook/tsconfig.json
@@ -1,9 +1,10 @@
 {
   "extends": "../tsconfig.json",
   "compilerOptions": {
+    "outDir": "",
     "allowJs": true,
-    "checkJs": true
+    "checkJs": true,
+    "types": ["static-assets", "environment", "inline-style-expand-shorthand", "storybook__addons"]
   },
-  "exclude": ["../**/*.test.ts", "../**/*.test.js", "../**/*.test.tsx", "../**/*.test.jsx"],
-  "include": ["../src/**/*", "*.js"]
+  "include": ["../src/**/*.stories.ts", "../src/**/*.stories.tsx", "*.js"]
 }
diff --git a/packages/react-theme/config/api-extractor.local.json b/packages/react-theme/config/api-extractor.local.json
index c2ea401c1c368..7974a129e8a33 100644
--- a/packages/react-theme/config/api-extractor.local.json
+++ b/packages/react-theme/config/api-extractor.local.json
@@ -1,5 +1,5 @@
 {
   "$schema": "https://developer.microsoft.com/json-schemas/api-extractor/v7/api-extractor.schema.json",
   "extends": "./api-extractor.json",
-  "mainEntryPointFilePath": "<projectFolder>/dist/<unscopedPackageName>/src/index.d.ts"
+  "mainEntryPointFilePath": "<projectFolder>/dist/packages/<unscopedPackageName>/src/index.d.ts"
 }
diff --git a/packages/react-theme/jest.config.js b/packages/react-theme/jest.config.js
index 73c7cb184bf1b..2596915ad5032 100644
--- a/packages/react-theme/jest.config.js
+++ b/packages/react-theme/jest.config.js
@@ -8,7 +8,7 @@ module.exports = {
   preset: '../../jest.preset.js',
   globals: {
     'ts-jest': {
-      tsConfig: '<rootDir>/tsconfig.json',
+      tsConfig: '<rootDir>/tsconfig.spec.json',
       diagnostics: false,
     },
   },
diff --git a/packages/react-theme/package.json b/packages/react-theme/package.json
index c4ce6c3b79177..6e0748cec080a 100644
--- a/packages/react-theme/package.json
+++ b/packages/react-theme/package.json
@@ -18,11 +18,12 @@
     "code-style": "just-scripts code-style",
     "just": "just-scripts",
     "lint": "just-scripts lint",
-    "start": "storybook",
+    "start": "yarn storybook",
     "storybook": "start-storybook",
     "test": "jest",
     "docs": "api-extractor run --config=config/api-extractor.local.json --local",
-    "build:local": "tsc -p . --module esnext --emitDeclarationOnly && node ../../scripts/typescript/normalize-import --output dist/react-theme/src && yarn docs"
+    "build:local": "tsc -p ./tsconfig.lib.json --module esnext --emitDeclarationOnly && node ../../scripts/typescript/normalize-import --output ./dist/packages/react-theme/src && yarn docs",
+    "type-check": "tsc -b tsconfig.json"
   },
   "devDependencies": {
     "@fluentui/eslint-plugin": "*",
diff --git a/packages/react-theme/tsconfig.json b/packages/react-theme/tsconfig.json
index d0ba217d5e49b..affceae1828ae 100644
--- a/packages/react-theme/tsconfig.json
+++ b/packages/react-theme/tsconfig.json
@@ -1,18 +1,25 @@
 {
   "extends": "../../tsconfig.base.json",
-  "include": ["src"],
   "compilerOptions": {
     "target": "ES2019",
-    "module": "CommonJS",
-    "lib": ["ES2019", "DOM"],
-    "outDir": "dist",
-    "jsx": "react",
-    "declaration": true,
-    "experimentalDecorators": true,
+    "noEmit": true,
+    "isolatedModules": true,
     "importHelpers": true,
+    "jsx": "react",
     "noUnusedLocals": true,
-    "preserveConstEnums": true,
-    "types": ["jest", "custom-global", "inline-style-expand-shorthand"],
-    "isolatedModules": true
-  }
+    "preserveConstEnums": true
+  },
+  "include": [],
+  "files": [],
+  "references": [
+    {
+      "path": "./tsconfig.lib.json"
+    },
+    {
+      "path": "./tsconfig.spec.json"
+    },
+    {
+      "path": "./.storybook/tsconfig.json"
+    }
+  ]
 }
diff --git a/packages/react-theme/tsconfig.lib.json b/packages/react-theme/tsconfig.lib.json
new file mode 100644
index 0000000000000..51f5726b71c68
--- /dev/null
+++ b/packages/react-theme/tsconfig.lib.json
@@ -0,0 +1,12 @@
+{
+  "extends": "./tsconfig.json",
+  "compilerOptions": {
+    "noEmit": false,
+    "lib": ["ES2019", "dom"],
+    "outDir": "dist",
+    "declaration": true,
+    "types": ["static-assets", "environment", "inline-style-expand-shorthand"]
+  },
+  "exclude": ["**/*.spec.ts", "**/*.spec.tsx", "**/*.test.ts", "**/*.test.tsx", "**/*.stories.ts", "**/*.stories.tsx"],
+  "include": ["./src/**/*.ts", "./src/**/*.tsx"]
+}
diff --git a/packages/react-theme/tsconfig.spec.json b/packages/react-theme/tsconfig.spec.json
new file mode 100644
index 0000000000000..28fa5226de420
--- /dev/null
+++ b/packages/react-theme/tsconfig.spec.json
@@ -0,0 +1,9 @@
+{
+  "extends": "./tsconfig.json",
+  "compilerOptions": {
+    "module": "CommonJS",
+    "outDir": "dist",
+    "types": ["jest", "node", "inline-style-expand-shorthand"]
+  },
+  "include": ["**/*.spec.ts", "**/*.spec.tsx", "**/*.test.ts", "**/*.test.tsx", "**/*.d.ts"]
+}