diff --git a/packages/@headlessui-react/CHANGELOG.md b/packages/@headlessui-react/CHANGELOG.md
index 81fe59f334..d406cc4714 100644
--- a/packages/@headlessui-react/CHANGELOG.md
+++ b/packages/@headlessui-react/CHANGELOG.md
@@ -50,6 +50,7 @@ and this project adheres to [Semantic Versioning](https://semver.org/spec/v2.0.0
 - Add `portal` prop to `Combobox`, `Listbox`, `Menu` and `Popover` components ([#3124](https://github.com/tailwindlabs/headlessui/pull/3124))
 - Add frozen value to `ComboboxOptions` component ([#3126](https://github.com/tailwindlabs/headlessui/pull/3126))
 - Add string shorthand for the `anchor` prop ([#3133](https://github.com/tailwindlabs/headlessui/pull/3133))
+- Use `var(--anchor-max-height)` when using the `anchor` prop ([#3148](https://github.com/tailwindlabs/headlessui/pull/3148))
 
 ## [1.7.19] - 2024-04-15
 
diff --git a/packages/@headlessui-react/src/internal/floating.tsx b/packages/@headlessui-react/src/internal/floating.tsx
index 398b126a5d..9dfa654f8c 100644
--- a/packages/@headlessui-react/src/internal/floating.tsx
+++ b/packages/@headlessui-react/src/internal/floating.tsx
@@ -316,7 +316,7 @@ export function FloatingProvider({
           Object.assign(elements.floating.style, {
             overflow: 'auto',
             maxWidth: `${availableWidth - padding}px`,
-            maxHeight: `${availableHeight - padding}px`,
+            maxHeight: `min(var(--anchor-max-height, 100vh), ${availableHeight - padding}px)`,
           })
         },
       }),