diff --git a/app/scripts/metamask-controller.js b/app/scripts/metamask-controller.js
index 11463edf3430..42815021f0ca 100644
--- a/app/scripts/metamask-controller.js
+++ b/app/scripts/metamask-controller.js
@@ -151,6 +151,8 @@ import {
 } from '@metamask/snaps-utils';
 ///: END:ONLY_INCLUDE_IF
 
+import { Interface } from '@ethersproject/abi';
+import { abiERC1155, abiERC721 } from '@metamask/metamask-eth-abis';
 import { isEvmAccountType } from '@metamask/keyring-api';
 import {
   methodsRequiringNetworkSwitch,
@@ -222,6 +224,10 @@ import {
   getCurrentChainSupportsSmartTransactions,
 } from '../../shared/modules/selectors';
 import { BaseUrl } from '../../shared/constants/urls';
+import {
+  TOKEN_TRANSFER_LOG_TOPIC_HASH,
+  TRANSFER_SINFLE_LOG_TOPIC_HASH,
+} from '../../shared/lib/transactions-controller-utils';
 import { BalancesController as MultichainBalancesController } from './lib/accounts/BalancesController';
 import {
   ///: BEGIN:ONLY_INCLUDE_IF(build-mmi)
@@ -6289,7 +6295,7 @@ export default class MetamaskController extends EventEmitter {
     }
 
     await this._createTransactionNotifcation(transactionMeta);
-    this._updateNFTOwnership(transactionMeta);
+    await this._updateNFTOwnership(transactionMeta);
     this._trackTransactionFailure(transactionMeta);
   }
 
@@ -6317,46 +6323,158 @@ export default class MetamaskController extends EventEmitter {
     }
   }
 
-  _updateNFTOwnership(transactionMeta) {
+  async _updateNFTOwnership(transactionMeta) {
     // if this is a transferFrom method generated from within the app it may be an NFT transfer transaction
     // in which case we will want to check and update ownership status of the transferred NFT.
 
-    const { type, txParams, chainId } = transactionMeta;
+    const { type, txParams, chainId, txReceipt } = transactionMeta;
+    const selectedAddress =
+      this.accountsController.getSelectedAccount().address;
 
-    if (
-      type !== TransactionType.tokenMethodTransferFrom ||
-      txParams === undefined
-    ) {
+    const { allNfts } = this.nftController.state;
+    const txReceiptLogs = txReceipt?.logs;
+
+    const isContractInteractionTx =
+      type === TransactionType.contractInteraction && txReceiptLogs;
+    const isTransferFromTx =
+      (type === TransactionType.tokenMethodTransferFrom ||
+        type === TransactionType.tokenMethodSafeTransferFrom) &&
+      txParams !== undefined;
+
+    if (!isContractInteractionTx && !isTransferFromTx) {
       return;
     }
 
-    const { data, to: contractAddress, from: userAddress } = txParams;
-    const transactionData = parseStandardTokenTransactionData(data);
-    // Sometimes the tokenId value is parsed as "_value" param. Not seeing this often any more, but still occasionally:
-    // i.e. call approve() on BAYC contract - https://etherscan.io/token/0xbc4ca0eda7647a8ab7c2061c2e118a18a936f13d#writeContract, and tokenId shows up as _value,
-    // not sure why since it doesn't match the ERC721 ABI spec we use to parse these transactions - https://github.com/MetaMask/metamask-eth-abis/blob/d0474308a288f9252597b7c93a3a8deaad19e1b2/src/abis/abiERC721.ts#L62.
-    const transactionDataTokenId =
-      getTokenIdParam(transactionData) ?? getTokenValueParam(transactionData);
+    if (isTransferFromTx) {
+      const { data, to: contractAddress, from: userAddress } = txParams;
+      const transactionData = parseStandardTokenTransactionData(data);
+      // Sometimes the tokenId value is parsed as "_value" param. Not seeing this often any more, but still occasionally:
+      // i.e. call approve() on BAYC contract - https://etherscan.io/token/0xbc4ca0eda7647a8ab7c2061c2e118a18a936f13d#writeContract, and tokenId shows up as _value,
+      // not sure why since it doesn't match the ERC721 ABI spec we use to parse these transactions - https://github.com/MetaMask/metamask-eth-abis/blob/d0474308a288f9252597b7c93a3a8deaad19e1b2/src/abis/abiERC721.ts#L62.
+      const transactionDataTokenId =
+        getTokenIdParam(transactionData) ?? getTokenValueParam(transactionData);
+
+      // check if its a known NFT
+      const knownNft = allNfts?.[userAddress]?.[chainId]?.find(
+        ({ address, tokenId }) =>
+          isEqualCaseInsensitive(address, contractAddress) &&
+          tokenId === transactionDataTokenId,
+      );
 
-    const { allNfts } = this.nftController.state;
+      // if it is we check and update ownership status.
+      if (knownNft) {
+        this.nftController.checkAndUpdateSingleNftOwnershipStatus(
+          knownNft,
+          false,
+          // TODO add networkClientId once it is available in the transactionMeta
+          // the chainId previously passed here didn't actually allow us to check for ownership on a non globally selected network
+          // because the check would use the provider for the globally selected network, not the chainId passed here.
+          { userAddress },
+        );
+      }
+    } else {
+      // Else if contract interaction we will parse the logs
+
+      const allNftTransferLog = txReceiptLogs.map((txReceiptLog) => {
+        const isERC1155NftTransfer =
+          txReceiptLog.topics &&
+          txReceiptLog.topics[0] === TRANSFER_SINFLE_LOG_TOPIC_HASH;
+        const isERC721NftTransfer =
+          txReceiptLog.topics &&
+          txReceiptLog.topics[0] === TOKEN_TRANSFER_LOG_TOPIC_HASH;
+        let isTransferToSelectedAddress;
+
+        if (isERC1155NftTransfer) {
+          isTransferToSelectedAddress =
+            txReceiptLog.topics &&
+            txReceiptLog.topics[3] &&
+            txReceiptLog.topics[3].match(selectedAddress?.slice(2));
+        }
 
-    // check if its a known NFT
-    const knownNft = allNfts?.[userAddress]?.[chainId]?.find(
-      ({ address, tokenId }) =>
-        isEqualCaseInsensitive(address, contractAddress) &&
-        tokenId === transactionDataTokenId,
-    );
+        if (isERC721NftTransfer) {
+          isTransferToSelectedAddress =
+            txReceiptLog.topics &&
+            txReceiptLog.topics[2] &&
+            txReceiptLog.topics[2].match(selectedAddress?.slice(2));
+        }
 
-    // if it is we check and update ownership status.
-    if (knownNft) {
-      this.nftController.checkAndUpdateSingleNftOwnershipStatus(
-        knownNft,
-        false,
-        // TODO add networkClientId once it is available in the transactionMeta
-        // the chainId previously passed here didn't actually allow us to check for ownership on a non globally selected network
-        // because the check would use the provider for the globally selected network, not the chainId passed here.
-        { userAddress },
-      );
+        return {
+          isERC1155NftTransfer,
+          isERC721NftTransfer,
+          isTransferToSelectedAddress,
+          ...txReceiptLog,
+        };
+      });
+      if (allNftTransferLog.length !== 0) {
+        const allNftParsedLog = [];
+        allNftTransferLog.forEach((singleLog) => {
+          if (
+            singleLog.isTransferToSelectedAddress &&
+            (singleLog.isERC1155NftTransfer || singleLog.isERC721NftTransfer)
+          ) {
+            let iface;
+            if (singleLog.isERC1155NftTransfer) {
+              iface = new Interface(abiERC1155);
+            } else {
+              iface = new Interface(abiERC721);
+            }
+            try {
+              const parsedLog = iface.parseLog({
+                data: singleLog.data,
+                topics: singleLog.topics,
+              });
+              allNftParsedLog.push({
+                contract: singleLog.address,
+                ...parsedLog,
+              });
+            } catch (err) {
+              // ignore
+            }
+          }
+        });
+        // Filter known nfts and new Nfts
+        const knownNFTs = [];
+        const newNFTs = [];
+        allNftParsedLog.forEach((single) => {
+          const tokenIdFromLog = getTokenIdParam(single);
+          const existingNft = allNfts?.[selectedAddress]?.[chainId]?.find(
+            ({ address, tokenId }) => {
+              return (
+                isEqualCaseInsensitive(address, single.contract) &&
+                tokenId === tokenIdFromLog
+              );
+            },
+          );
+          if (existingNft) {
+            knownNFTs.push(existingNft);
+          } else {
+            newNFTs.push({
+              tokenId: tokenIdFromLog,
+              ...single,
+            });
+          }
+        });
+        // For known nfts only refresh ownership
+        const refreshOwnershipNFts = knownNFTs.map(async (singleNft) => {
+          return this.nftController.checkAndUpdateSingleNftOwnershipStatus(
+            singleNft,
+            false,
+            // TODO add networkClientId once it is available in the transactionMeta
+            // the chainId previously passed here didn't actually allow us to check for ownership on a non globally selected network
+            // because the check would use the provider for the globally selected network, not the chainId passed here.
+            { selectedAddress },
+          );
+        });
+        await Promise.allSettled(refreshOwnershipNFts);
+        // For new nfts, add them to state
+        const addNftPromises = newNFTs.map(async (singleNft) => {
+          return this.nftController.addNft(
+            singleNft.contract,
+            singleNft.tokenId,
+          );
+        });
+        await Promise.allSettled(addNftPromises);
+      }
     }
   }
 
diff --git a/shared/lib/transactions-controller-utils.js b/shared/lib/transactions-controller-utils.js
index 425ff33b6f32..073ff922af67 100644
--- a/shared/lib/transactions-controller-utils.js
+++ b/shared/lib/transactions-controller-utils.js
@@ -9,6 +9,9 @@ export const TOKEN_TRANSFER_LOG_TOPIC_HASH =
 
 export const TRANSACTION_NO_CONTRACT_ERROR_KEY = 'transactionErrorNoContract';
 
+export const TRANSFER_SINFLE_LOG_TOPIC_HASH =
+  '0xc3d58168c5ae7397731d063d5bbf3d657854427343f4c083240f7aacaa2d0f62';
+
 export const TEN_SECONDS_IN_MILLISECONDS = 10_000;
 
 export function calcGasTotal(gasLimit = '0', gasPrice = '0') {
diff --git a/test/e2e/tests/tokens/nft/erc721-interaction.spec.js b/test/e2e/tests/tokens/nft/erc721-interaction.spec.js
index 37516fd716b8..a323077aa692 100644
--- a/test/e2e/tests/tokens/nft/erc721-interaction.spec.js
+++ b/test/e2e/tests/tokens/nft/erc721-interaction.spec.js
@@ -13,6 +13,73 @@ const FixtureBuilder = require('../../../fixture-builder');
 describe('ERC721 NFTs testdapp interaction', function () {
   const smartContract = SMART_CONTRACTS.NFTS;
 
+  it('should add NFTs to state by parsing tx logs without having to click on watch NFT', async function () {
+    await withFixtures(
+      {
+        dapp: true,
+        fixtures: new FixtureBuilder()
+          .withPermissionControllerConnectedToTestDapp()
+          .build(),
+        ganacheOptions: defaultGanacheOptions,
+        smartContract,
+        title: this.test.fullTitle(),
+      },
+      async ({ driver, _, contractRegistry }) => {
+        const contract = contractRegistry.getContractAddress(smartContract);
+        await unlockWallet(driver);
+
+        // Open Dapp and wait for deployed contract
+        await openDapp(driver, contract);
+        await driver.findClickableElement('#deployButton');
+
+        // mint NFTs
+        await driver.fill('#mintAmountInput', '5');
+        await driver.clickElement({ text: 'Mint', tag: 'button' });
+
+        // Notification
+        await driver.waitUntilXWindowHandles(3);
+        const windowHandles = await driver.getAllWindowHandles();
+        const [extension] = windowHandles;
+        await driver.switchToWindowWithTitle(
+          WINDOW_TITLES.Dialog,
+          windowHandles,
+        );
+        await driver.waitForSelector({
+          css: '.confirm-page-container-summary__action__name',
+          text: 'Deposit',
+        });
+        await driver.clickElement({ text: 'Confirm', tag: 'button' });
+        await driver.waitUntilXWindowHandles(2);
+        await driver.switchToWindow(extension);
+        await driver.clickElement(
+          '[data-testid="account-overview__activity-tab"]',
+        );
+        const transactionItem = await driver.waitForSelector({
+          css: '[data-testid="activity-list-item-action"]',
+          text: 'Deposit',
+        });
+        assert.equal(await transactionItem.isDisplayed(), true);
+
+        // verify the mint transaction has finished
+        await driver.switchToWindowWithTitle('E2E Test Dapp', windowHandles);
+        const nftsMintStatus = await driver.findElement({
+          css: '#nftsStatus',
+          text: 'Mint completed',
+        });
+        assert.equal(await nftsMintStatus.isDisplayed(), true);
+
+        await driver.switchToWindow(extension);
+
+        await clickNestedButton(driver, 'NFTs');
+        await driver.findElement({ text: 'TestDappNFTs (5)' });
+        const nftsListItemsFirstCheck = await driver.findElements(
+          '.nft-item__container',
+        );
+        assert.equal(nftsListItemsFirstCheck.length, 5);
+      },
+    );
+  });
+
   it('should prompt users to add their NFTs to their wallet (one by one) @no-mmi', async function () {
     await withFixtures(
       {
@@ -97,14 +164,16 @@ describe('ERC721 NFTs testdapp interaction', function () {
         await driver.clickElement({ text: 'Add NFTs', tag: 'button' });
         await driver.switchToWindow(extension);
         await clickNestedButton(driver, 'NFTs');
-        await driver.findElement({ text: 'TestDappNFTs (3)' });
+        // Changed this check from 3 to 6, because after mint all nfts has been added to state,
+        await driver.findElement({ text: 'TestDappNFTs (6)' });
         const nftsListItemsFirstCheck = await driver.findElements(
           '.nft-item__container',
         );
-        assert.equal(nftsListItemsFirstCheck.length, 3);
+        assert.equal(nftsListItemsFirstCheck.length, 6);
 
         await driver.switchToWindowWithTitle('E2E Test Dapp', windowHandles);
         await driver.fill('#watchNFTInput', '4');
+
         await driver.clickElement({ text: 'Watch NFT', tag: 'button' });
         await driver.fill('#watchNFTInput', '5');
         await driver.clickElement({ text: 'Watch NFT', tag: 'button' });
diff --git a/test/e2e/tests/tokens/nft/send-nft.spec.js b/test/e2e/tests/tokens/nft/send-nft.spec.js
index 7df8febcab56..a9b89a2abb9b 100644
--- a/test/e2e/tests/tokens/nft/send-nft.spec.js
+++ b/test/e2e/tests/tokens/nft/send-nft.spec.js
@@ -145,8 +145,6 @@ describe('Send NFT', function () {
         // Go back to NFTs tab and check the imported NFT is shown as previously owned
         await driver.clickElement('[data-testid="account-overview__nfts-tab"]');
 
-        await driver.clickElement('[data-testid="refresh-list-button"]');
-
         const previouslyOwnedNft = await driver.findElement({
           css: 'h5',
           text: 'Previously Owned',