diff --git a/packages/block-editor/src/store/private-selectors.js b/packages/block-editor/src/store/private-selectors.js
index 2a4b64f3608874..e83a251ec7e671 100644
--- a/packages/block-editor/src/store/private-selectors.js
+++ b/packages/block-editor/src/store/private-selectors.js
@@ -144,8 +144,6 @@ export const getEnabledClientIdsTree = createRegistrySelector( ( select ) =>
 		state.derivedBlockEditingModes,
 		state.derivedNavModeBlockEditingModes,
 		state.blockEditingModes,
-		state.settings.templateLock,
-		state.blockListSettings,
 		select( STORE_NAME ).__unstableGetEditorMode( state ),
 	] )
 );
diff --git a/packages/block-editor/src/store/reducer.js b/packages/block-editor/src/store/reducer.js
index 5fc08ce7a37b89..ec82d5192dc6f7 100644
--- a/packages/block-editor/src/store/reducer.js
+++ b/packages/block-editor/src/store/reducer.js
@@ -2267,6 +2267,12 @@ function getDerivedBlockEditingModesForTree(
 			syncedPatternClientIds.push( clientId );
 		}
 	} );
+	const contentOnlyTemplateLockedClientIds = Object.keys(
+		state.blockListSettings
+	).filter(
+		( clientId ) =>
+			state.blockListSettings[ clientId ]?.templateLock === 'contentOnly'
+	);
 
 	traverseBlockTree( state, treeClientId, ( block ) => {
 		const { clientId, name: blockName } = block;
@@ -2457,6 +2463,23 @@ function getDerivedBlockEditingModesForTree(
 				derivedBlockEditingModes.set( clientId, 'disabled' );
 			}
 		}
+
+		// `templateLock: 'contentOnly'` derived modes.
+		if ( contentOnlyTemplateLockedClientIds.length ) {
+			const hasContentOnlyTemplateLockedParent =
+				!! findParentInClientIdsList(
+					state,
+					clientId,
+					contentOnlyTemplateLockedClientIds
+				);
+			if ( hasContentOnlyTemplateLockedParent ) {
+				if ( isContentBlock( blockName ) ) {
+					derivedBlockEditingModes.set( clientId, 'contentOnly' );
+				} else {
+					derivedBlockEditingModes.set( clientId, 'disabled' );
+				}
+			}
+		}
 	} );
 
 	return derivedBlockEditingModes;
@@ -2628,6 +2651,75 @@ export function withDerivedBlockEditingModes( reducer ) {
 				}
 				break;
 			}
+			case 'UPDATE_BLOCK_LIST_SETTINGS': {
+				// Handle the addition and removal of contentOnly template locked blocks.
+				const addedBlocks = [];
+				const removedClientIds = [];
+
+				const updates =
+					typeof action.clientId === 'string'
+						? { [ action.clientId ]: action.settings }
+						: action.clientId;
+
+				for ( const clientId in updates ) {
+					const isNewContentOnlyBlock =
+						state.blockListSettings[ clientId ]?.templateLock !==
+							'contentOnly' &&
+						nextState.blockListSettings[ clientId ]
+							?.templateLock === 'contentOnly';
+
+					const wasContentOnlyBlock =
+						state.blockListSettings[ clientId ]?.templateLock ===
+							'contentOnly' &&
+						nextState.blockListSettings[ clientId ]
+							?.templateLock !== 'contentOnly';
+
+					if ( isNewContentOnlyBlock ) {
+						addedBlocks.push(
+							nextState.blocks.tree.get( clientId )
+						);
+					} else if ( wasContentOnlyBlock ) {
+						removedClientIds.push( clientId );
+					}
+				}
+
+				if ( ! addedBlocks.length && ! removedClientIds.length ) {
+					break;
+				}
+
+				const nextDerivedBlockEditingModes =
+					getDerivedBlockEditingModesUpdates( {
+						prevState: state,
+						nextState,
+						addedBlocks,
+						removedClientIds,
+						isNavMode: false,
+					} );
+				const nextDerivedNavModeBlockEditingModes =
+					getDerivedBlockEditingModesUpdates( {
+						prevState: state,
+						nextState,
+						addedBlocks,
+						removedClientIds,
+						isNavMode: true,
+					} );
+
+				if (
+					nextDerivedBlockEditingModes ||
+					nextDerivedNavModeBlockEditingModes
+				) {
+					return {
+						...nextState,
+						derivedBlockEditingModes:
+							nextDerivedBlockEditingModes ??
+							state.derivedBlockEditingModes,
+						derivedNavModeBlockEditingModes:
+							nextDerivedNavModeBlockEditingModes ??
+							state.derivedNavModeBlockEditingModes,
+					};
+				}
+				break;
+			}
 			case 'SET_BLOCK_EDITING_MODE':
 			case 'UNSET_BLOCK_EDITING_MODE':
 			case 'SET_HAS_CONTROLLED_INNER_BLOCKS': {
diff --git a/packages/block-editor/src/store/selectors.js b/packages/block-editor/src/store/selectors.js
index 85ea65e5875d5c..1e18ca232a87fa 100644
--- a/packages/block-editor/src/store/selectors.js
+++ b/packages/block-editor/src/store/selectors.js
@@ -3076,62 +3076,36 @@ export function __unstableIsWithinBlockOverlay( state, clientId ) {
  * @return {BlockEditingMode} The block editing mode. One of `'disabled'`,
  *                            `'contentOnly'`, or `'default'`.
  */
-export const getBlockEditingMode = createRegistrySelector(
-	( select ) =>
-		( state, clientId = '' ) => {
-			// Some selectors that call this provide `null` as the default
-			// rootClientId, but the default rootClientId is actually `''`.
-			if ( clientId === null ) {
-				clientId = '';
-			}
+export function getBlockEditingMode( state, clientId = '' ) {
+	// Some selectors that call this provide `null` as the default
+	// rootClientId, but the default rootClientId is actually `''`.
+	if ( clientId === null ) {
+		clientId = '';
+	}
 
-			const isNavMode = isNavigationMode( state );
-
-			// If the editor is currently not in navigation mode, check if the clientId
-			// has an editing mode set in the regular derived map.
-			// There may be an editing mode set here for synced patterns or in zoomed out
-			// mode.
-			if (
-				! isNavMode &&
-				state.derivedBlockEditingModes?.has( clientId )
-			) {
-				return state.derivedBlockEditingModes.get( clientId );
-			}
+	const isNavMode = isNavigationMode( state );
 
-			// If the editor *is* in navigation mode, the block editing mode states
-			// are stored in the derivedNavModeBlockEditingModes map.
-			if (
-				isNavMode &&
-				state.derivedNavModeBlockEditingModes?.has( clientId )
-			) {
-				return state.derivedNavModeBlockEditingModes.get( clientId );
-			}
+	// If the editor is currently not in navigation mode, check if the clientId
+	// has an editing mode set in the regular derived map.
+	// There may be an editing mode set here for synced patterns or in zoomed out
+	// mode.
+	if ( ! isNavMode && state.derivedBlockEditingModes?.has( clientId ) ) {
+		return state.derivedBlockEditingModes.get( clientId );
+	}
 
-			// In normal mode, consider that an explicitly set editing mode takes over.
-			const blockEditingMode = state.blockEditingModes.get( clientId );
-			if ( blockEditingMode ) {
-				return blockEditingMode;
-			}
+	// If the editor *is* in navigation mode, the block editing mode states
+	// are stored in the derivedNavModeBlockEditingModes map.
+	if ( isNavMode && state.derivedNavModeBlockEditingModes?.has( clientId ) ) {
+		return state.derivedNavModeBlockEditingModes.get( clientId );
+	}
 
-			// In normal mode, top level is default mode.
-			if ( clientId === '' ) {
-				return 'default';
-			}
+	// In normal mode, consider that an explicitly set editing mode takes over.
+	if ( state.blockEditingModes.has( clientId ) ) {
+		return state.blockEditingModes.get( clientId );
+	}
 
-			const rootClientId = getBlockRootClientId( state, clientId );
-			const templateLock = getTemplateLock( state, rootClientId );
-			// If the parent of the block is contentOnly locked, check whether it's a content block.
-			if ( templateLock === 'contentOnly' ) {
-				const name = getBlockName( state, clientId );
-				const { hasContentRoleAttribute } = unlock(
-					select( blocksStore )
-				);
-				const isContent = hasContentRoleAttribute( name );
-				return isContent ? 'contentOnly' : 'disabled';
-			}
-			return 'default';
-		}
-);
+	return 'default';
+}
 
 /**
  * Indicates if a block is ungroupable.
diff --git a/packages/block-editor/src/store/test/reducer.js b/packages/block-editor/src/store/test/reducer.js
index b0e67a5de53169..02d5962ef50efc 100644
--- a/packages/block-editor/src/store/test/reducer.js
+++ b/packages/block-editor/src/store/test/reducer.js
@@ -3575,6 +3575,7 @@ describe( 'state', () => {
 				blocks,
 				settings,
 				zoomLevel,
+				blockListSettings,
 				blockEditingModes,
 			} )
 		);
@@ -3885,6 +3886,112 @@ describe( 'state', () => {
 			} );
 		} );
 
+		describe( 'contentOnly template locking', () => {
+			let initialState;
+			beforeAll( () => {
+				initialState = dispatchActions(
+					[
+						{
+							type: 'RESET_BLOCKS',
+							blocks: [
+								{
+									name: 'core/group',
+									clientId: 'group-1',
+									attributes: {},
+									innerBlocks: [
+										{
+											name: 'core/paragraph',
+											clientId: 'paragraph-1',
+											attributes: {},
+											innerBlocks: [],
+										},
+										{
+											name: 'core/group',
+											clientId: 'group-2',
+											attributes: {},
+											innerBlocks: [
+												{
+													name: 'core/paragraph',
+													clientId: 'paragraph-2',
+													attributes: {},
+													innerBlocks: [],
+												},
+											],
+										},
+									],
+								},
+							],
+						},
+						{
+							type: 'UPDATE_BLOCK_LIST_SETTINGS',
+							clientId: 'group-1',
+							settings: {
+								templateLock: 'contentOnly',
+							},
+						},
+					],
+					testReducer,
+					initialState
+				);
+			} );
+
+			it( 'returns the expected block editing modes for a parent block with contentOnly template locking', () => {
+				// Only the parent pattern and its own children that have bindings
+				// are in contentOnly mode. All other blocks are disabled.
+				expect( initialState.derivedBlockEditingModes ).toEqual(
+					new Map(
+						Object.entries( {
+							'paragraph-1': 'contentOnly',
+							'group-2': 'disabled',
+							'paragraph-2': 'contentOnly',
+						} )
+					)
+				);
+			} );
+
+			it( 'removes block editing modes when template locking is removed', () => {
+				const { derivedBlockEditingModes } = dispatchActions(
+					[
+						{
+							type: 'UPDATE_BLOCK_LIST_SETTINGS',
+							clientId: 'group-1',
+							settings: {
+								templateLock: false,
+							},
+						},
+					],
+					testReducer,
+					initialState
+				);
+
+				expect( derivedBlockEditingModes ).toEqual( new Map() );
+			} );
+
+			it( 'allows explicitly set blockEditingModes to override the contentOnly template locking', () => {
+				const { derivedBlockEditingModes } = dispatchActions(
+					[
+						{
+							type: 'SET_BLOCK_EDITING_MODE',
+							clientId: 'paragraph-2',
+							mode: 'disabled',
+						},
+					],
+					testReducer,
+					initialState
+				);
+
+				expect( derivedBlockEditingModes ).toEqual(
+					new Map(
+						Object.entries( {
+							'paragraph-1': 'contentOnly',
+							'group-2': 'disabled',
+							// Paragraph 2 already has an explicit mode, so isn't set as a derived mode.
+						} )
+					)
+				);
+			} );
+		} );
+
 		describe( 'navigation mode', () => {
 			let initialState;
 
diff --git a/packages/block-editor/src/store/test/selectors.js b/packages/block-editor/src/store/test/selectors.js
index 587e1036e405e2..d5fedb4ea7c0b8 100644
--- a/packages/block-editor/src/store/test/selectors.js
+++ b/packages/block-editor/src/store/test/selectors.js
@@ -4380,92 +4380,9 @@ describe( '__unstableGetClientIdsTree', () => {
 
 describe( 'getBlockEditingMode', () => {
 	const baseState = {
-		settings: {},
-		blocks: {
-			byClientId: new Map( [
-				[
-					'6cf70164-9097-4460-bcbf-200560546988',
-					{ name: 'core/template-part' },
-				], // Header
-				[
-					'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337',
-					{ name: 'core/group' },
-				], // Group
-				[
-					'b26fc763-417d-4f01-b81c-2ec61e14a972',
-					{ name: 'core/post-title' },
-				], // |  Post Title
-				[
-					'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f',
-					{ name: 'core/group' },
-				], // |  Group
-				[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', { name: 'core/p' } ], // | |  Paragraph
-				[ 'e178812d-ce5e-48c7-a945-8ae4ffcbbb7c', { name: 'core/p' } ], // | |  Paragraph
-				[
-					'9b9c5c3f-2e46-4f02-9e14-9fed515b958s',
-					{ name: 'core/group' },
-				], // | | Group
-			] ),
-			order: new Map( [
-				[
-					'',
-					[
-						'6cf70164-9097-4460-bcbf-200560546988',
-						'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337',
-					],
-				],
-				[ '6cf70164-9097-4460-bcbf-200560546988', [] ],
-				[
-					'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337',
-					[
-						'b26fc763-417d-4f01-b81c-2ec61e14a972',
-						'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f',
-					],
-				],
-				[ 'b26fc763-417d-4f01-b81c-2ec61e14a972', [] ],
-				[
-					'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f',
-					[
-						'b3247f75-fd94-4fef-97f9-5bfd162cc416',
-						'e178812d-ce5e-48c7-a945-8ae4ffcbbb7c',
-						'9b9c5c3f-2e46-4f02-9e14-9fed515b958s',
-					],
-				],
-				[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', [] ],
-				[ 'e178812d-ce5e-48c7-a945-8ae4ffcbbb7c', [] ],
-				[ '9b9c5c3f-2e46-4f02-9e14-9fed515b958s', [] ],
-			] ),
-			parents: new Map( [
-				[ '6cf70164-9097-4460-bcbf-200560546988', '' ],
-				[ 'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337', '' ],
-				[
-					'b26fc763-417d-4f01-b81c-2ec61e14a972',
-					'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337',
-				],
-				[
-					'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f',
-					'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337',
-				],
-				[
-					'b3247f75-fd94-4fef-97f9-5bfd162cc416',
-					'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f',
-				],
-				[
-					'e178812d-ce5e-48c7-a945-8ae4ffcbbb7c',
-					'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f',
-				],
-				[
-					'9b9c5c3f-2e46-4f02-9e14-9fed515b958s',
-					'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f',
-				],
-			] ),
-		},
-		blockListSettings: {
-			'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337': {},
-			'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f': {},
-		},
 		blockEditingModes: new Map( [] ),
 		derivedBlockEditingModes: new Map( [] ),
+		derivedNavModeBlockEditingModes: new Map( [] ),
 	};
 
 	const hasContentRoleAttribute = jest.fn( () => false );
@@ -4514,115 +4431,59 @@ describe( 'getBlockEditingMode', () => {
 		).toBe( 'contentOnly' );
 	} );
 
-	it( 'should return disabled if explicitly set on a parent', () => {
-		const state = {
-			...baseState,
-			blockEditingModes: new Map( [
-				[ 'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337', 'disabled' ],
-			] ),
-			derivedBlockEditingModes: new Map( [
-				[ 'b26fc763-417d-4f01-b81c-2ec61e14a972', 'disabled' ],
-				[ '9b9c5c3f-2e46-4f02-9e14-9fe9515b958f', 'disabled' ],
-				[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'disabled' ],
-				[ 'e178812d-ce5e-48c7-a945-8ae4ffcbbb7c', 'disabled' ],
-				[ '9b9c5c3f-2e46-4f02-9e14-9fed515b958s', 'disabled' ],
-			] ),
-		};
-		expect(
-			getBlockEditingMode( state, 'b3247f75-fd94-4fef-97f9-5bfd162cc416' )
-		).toBe( 'disabled' );
-	} );
-
-	it( 'should return default if parent is set to contentOnly', () => {
-		const state = {
-			...baseState,
-			blockEditingModes: new Map( [
-				[ 'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337', 'contentOnly' ],
-			] ),
-		};
-		expect(
-			getBlockEditingMode( state, 'b3247f75-fd94-4fef-97f9-5bfd162cc416' )
-		).toBe( 'default' );
-	} );
-
-	it( 'should return disabled if overridden by a parent', () => {
-		const state = {
-			...baseState,
-			blockEditingModes: new Map( [
-				[ '', 'disabled' ],
-				[ 'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337', 'default' ],
-				[ '9b9c5c3f-2e46-4f02-9e14-9fe9515b958f', 'disabled' ],
-			] ),
-			derivedBlockEditingModes: new Map( [
-				[ '6cf70164-9097-4460-bcbf-200560546988', 'disabled' ],
-				[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'disabled' ],
-				[ 'e178812d-ce5e-48c7-a945-8ae4ffcbbb7c', 'disabled' ],
-				[ '9b9c5c3f-2e46-4f02-9e14-9fed515b958s', 'disabled' ],
-			] ),
-		};
-		expect(
-			getBlockEditingMode( state, 'b3247f75-fd94-4fef-97f9-5bfd162cc416' )
-		).toBe( 'disabled' );
-	} );
-
-	it( 'should return disabled if explicitly set on root', () => {
-		const state = {
-			...baseState,
-			blockEditingModes: new Map( [ [ '', 'disabled' ] ] ),
-			derivedBlockEditingModes: new Map( [
-				[ '6cf70164-9097-4460-bcbf-200560546988', 'disabled' ],
-				[ 'ef45d5fd-5234-4fd5-ac4f-c3736c7f9337', 'disabled' ],
-				[ 'b26fc763-417d-4f01-b81c-2ec61e14a972', 'disabled' ],
-				[ '9b9c5c3f-2e46-4f02-9e14-9fe9515b958f', 'disabled' ],
-				[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'disabled' ],
-				[ 'e178812d-ce5e-48c7-a945-8ae4ffcbbb7c', 'disabled' ],
-				[ '9b9c5c3f-2e46-4f02-9e14-9fed515b958s', 'disabled' ],
-			] ),
-		};
-		expect(
-			getBlockEditingMode( state, 'b3247f75-fd94-4fef-97f9-5bfd162cc416' )
-		).toBe( 'disabled' );
-	} );
-
-	it( 'should return default if root is contentOnly', () => {
-		const state = {
-			...baseState,
-			blockEditingModes: new Map( [ [ '', 'contentOnly' ] ] ),
-		};
-		expect(
-			getBlockEditingMode( state, 'b3247f75-fd94-4fef-97f9-5bfd162cc416' )
-		).toBe( 'default' );
-	} );
+	describe( 'derived block editing modes override standard block editing modes', () => {
+		it( 'should return default if explicitly set', () => {
+			const state = {
+				...baseState,
+				blockEditingModes: new Map( [
+					[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'contentOnly' ],
+				] ),
+				derivedBlockEditingModes: new Map( [
+					[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'default' ],
+				] ),
+			};
+			expect(
+				getBlockEditingMode(
+					state,
+					'b3247f75-fd94-4fef-97f9-5bfd162cc416'
+				)
+			).toBe( 'default' );
+		} );
 
-	it( 'should return disabled if parent is locked and the block has no content role', () => {
-		const state = {
-			...baseState,
-			blockListSettings: {
-				...baseState.blockListSettings,
-				'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f': {
-					templateLock: 'contentOnly',
-				},
-			},
-		};
-		hasContentRoleAttribute.mockReturnValueOnce( false );
-		expect(
-			getBlockEditingMode( state, 'b3247f75-fd94-4fef-97f9-5bfd162cc416' )
-		).toBe( 'disabled' );
-	} );
+		it( 'should return disabled if explicitly set', () => {
+			const state = {
+				...baseState,
+				blockEditingModes: new Map( [
+					[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'contentOnly' ],
+				] ),
+				derivedBlockEditingModes: new Map( [
+					[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'disabled' ],
+				] ),
+			};
+			expect(
+				getBlockEditingMode(
+					state,
+					'b3247f75-fd94-4fef-97f9-5bfd162cc416'
+				)
+			).toBe( 'disabled' );
+		} );
 
-	it( 'should return contentOnly if parent is locked and the block has a content role', () => {
-		const state = {
-			...baseState,
-			blockListSettings: {
-				...baseState.blockListSettings,
-				'9b9c5c3f-2e46-4f02-9e14-9fe9515b958f': {
-					templateLock: 'contentOnly',
-				},
-			},
-		};
-		hasContentRoleAttribute.mockReturnValueOnce( true );
-		expect(
-			getBlockEditingMode( state, 'b3247f75-fd94-4fef-97f9-5bfd162cc416' )
-		).toBe( 'contentOnly' );
+		it( 'should return contentOnly if explicitly set', () => {
+			const state = {
+				...baseState,
+				blockEditingModes: new Map( [
+					[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'default' ],
+				] ),
+				derivedBlockEditingModes: new Map( [
+					[ 'b3247f75-fd94-4fef-97f9-5bfd162cc416', 'contentOnly' ],
+				] ),
+			};
+			expect(
+				getBlockEditingMode(
+					state,
+					'b3247f75-fd94-4fef-97f9-5bfd162cc416'
+				)
+			).toBe( 'contentOnly' );
+		} );
 	} );
 } );