diff --git a/sdk/eventgrid/azure-messaging-eventgrid/CHANGELOG.md b/sdk/eventgrid/azure-messaging-eventgrid/CHANGELOG.md
index 1577e08355e04..40ec8100e2d51 100644
--- a/sdk/eventgrid/azure-messaging-eventgrid/CHANGELOG.md
+++ b/sdk/eventgrid/azure-messaging-eventgrid/CHANGELOG.md
@@ -1,7 +1,8 @@
 # Release History
 
 ## 4.5.0-beta.1 (Unreleased)
-
+### Features Added
+- Added `EventGridPublisherClientBuilder#credential(TokenCredential credential)` to support Azure Active Directory authentication.
 
 ## 4.4.0 (2021-06-09)
 ### New Features
diff --git a/sdk/eventgrid/azure-messaging-eventgrid/README.md b/sdk/eventgrid/azure-messaging-eventgrid/README.md
index c5bebb8ff7086..3a06dbe68b343 100644
--- a/sdk/eventgrid/azure-messaging-eventgrid/README.md
+++ b/sdk/eventgrid/azure-messaging-eventgrid/README.md
@@ -54,8 +54,8 @@ az eventgrid domain create --location <location> --resource-group <your-resource
 
 ### Authenticate the Client
 
-In order to send events, we need an endpoint to send to and some authentication for the endpoint, either as a 
-key credential or a shared access signature.
+In order to send events, we need an endpoint to send to and some authentication for the endpoint. The authentication can be 
+a key credential, a shared access signature, or Azure Active Directory token authentication.
 The endpoint and key can both be obtained through [Azure Portal][portal] or [Azure CLI][cli].
 
 #### Endpoint
@@ -75,6 +75,11 @@ using the following command in [Azure CLI][cli]. Anyone of the keys listed will
 az eventgrid topic key list --name <your-resource-name> --resource-group <your-resource-group-name>
 ```
 
+#### Azure Active Directory (AAD) Token authentication
+Azure Event Grid provides integration with Azure Active Directory (Azure AD) for identity-based authentication of requests. 
+With Azure AD, you can use role-based access control (RBAC) to grant access to your Azure Event Grid resources to users, groups, or applications.
+To send events to a topic or domain with a `TokenCredential`, the authenticated identity should have the "EventGrid Data Sender" role assigned.
+
 #### Creating the Client
 
 ##### Using endpoint and access key to create the client
@@ -138,7 +143,7 @@ limited time, you can use it to create the publisher client:
 Sync client:
 <!-- embedme ./src/samples/java/com/azure/messaging/eventgrid/samples/ReadmeSamples.java#L102-L105 -->
 ```java
-EventGridPublisherClient<CloudEvent> eventGridEventClient = new EventGridPublisherClientBuilder()
+EventGridPublisherClient<CloudEvent> cloudEventClient = new EventGridPublisherClientBuilder()
     .endpoint("<endpont of your event grid topic/domain that accepts CloudEvent schema>")
     .credential(new AzureSasCredential("<sas token that can access the endpoint>"))
     .buildCloudEventPublisherClient();
@@ -152,6 +157,27 @@ EventGridPublisherAsyncClient<CloudEvent> cloudEventAsyncClient = new EventGridP
     .buildCloudEventPublisherAsyncClient();
 ```
 
+##### Using endpoint and Azure Active Directory (AAD) token credential to create the client
+To use the AAD token credential, include `azure-identity` artifact as a dependency. Refer to
+[azure-identity README](https://docs.microsoft.com/java/api/overview/azure/identity-readme) for details.
+
+Sync client:
+<!-- embedme ./src/samples/java/com/azure/messaging/eventgrid/samples/ReadmeSamples.java#L231-L234 -->
+```java
+EventGridPublisherClient<CloudEvent> cloudEventClient = new EventGridPublisherClientBuilder()
+    .endpoint("<endpoint of your event grid topic/domain that accepts CloudEvent schema>")
+    .credential(new DefaultAzureCredentialBuilder().build())
+    .buildCloudEventPublisherClient();
+```
+Async client:
+<!-- embedme ./src/samples/java/com/azure/messaging/eventgrid/samples/ReadmeSamples.java#L238-L241 -->
+```java
+EventGridPublisherAsyncClient<CloudEvent> cloudEventClient = new EventGridPublisherClientBuilder()
+    .endpoint("<endpoint of your event grid topic/domain that accepts CloudEvent schema>")
+    .credential(new DefaultAzureCredentialBuilder().build())
+    .buildCloudEventPublisherAsyncClient();
+```
+
 #### Create a SAS token for other people to send events for a limited period of time
 If you'd like to give permission to other people to publish events to your Event Grid Topic or Domain for some time, you can create
 a SAS (**Shared Access Signature**) for them so they can create an `EventGridPublisherClient` like the above to use `AzureSasCredential`
diff --git a/sdk/eventgrid/azure-messaging-eventgrid/pom.xml b/sdk/eventgrid/azure-messaging-eventgrid/pom.xml
index 579acebc7a288..a7d097543c09b 100644
--- a/sdk/eventgrid/azure-messaging-eventgrid/pom.xml
+++ b/sdk/eventgrid/azure-messaging-eventgrid/pom.xml
@@ -83,6 +83,12 @@
       <version>12.10.0</version> <!-- {x-version-update;com.azure:azure-storage-queue;dependency} -->
       <scope>test</scope>
     </dependency>
+    <dependency>
+      <groupId>com.azure</groupId>
+      <artifactId>azure-identity</artifactId>
+      <version>1.3.3</version> <!-- {x-version-update;com.azure:azure-identity;dependency} -->
+      <scope>test</scope>
+    </dependency>
     <dependency>
       <groupId>org.junit.jupiter</groupId>
       <artifactId>junit-jupiter-api</artifactId>
diff --git a/sdk/eventgrid/azure-messaging-eventgrid/src/main/java/com/azure/messaging/eventgrid/EventGridPublisherClientBuilder.java b/sdk/eventgrid/azure-messaging-eventgrid/src/main/java/com/azure/messaging/eventgrid/EventGridPublisherClientBuilder.java
index 7a7c02ae509ed..2a444a0630cfb 100644
--- a/sdk/eventgrid/azure-messaging-eventgrid/src/main/java/com/azure/messaging/eventgrid/EventGridPublisherClientBuilder.java
+++ b/sdk/eventgrid/azure-messaging-eventgrid/src/main/java/com/azure/messaging/eventgrid/EventGridPublisherClientBuilder.java
@@ -6,6 +6,7 @@
 import com.azure.core.annotation.ServiceClientBuilder;
 import com.azure.core.credential.AzureKeyCredential;
 import com.azure.core.credential.AzureSasCredential;
+import com.azure.core.credential.TokenCredential;
 import com.azure.core.http.HttpClient;
 import com.azure.core.http.HttpHeader;
 import com.azure.core.http.HttpHeaders;
@@ -14,6 +15,7 @@
 import com.azure.core.http.policy.AddDatePolicy;
 import com.azure.core.http.policy.AddHeadersPolicy;
 import com.azure.core.http.policy.AzureKeyCredentialPolicy;
+import com.azure.core.http.policy.BearerTokenAuthenticationPolicy;
 import com.azure.core.http.policy.HttpLogOptions;
 import com.azure.core.http.policy.HttpLoggingPolicy;
 import com.azure.core.http.policy.HttpPipelinePolicy;
@@ -53,6 +55,7 @@ public final class EventGridPublisherClientBuilder {
     private static final String EVENTGRID_PROPERTIES = "azure-messaging-eventgrid.properties";
     private static final String NAME = "name";
     private static final String VERSION = "version";
+    private static final String DEFAULT_EVENTGRID_SCOPE = "https://eventgrid.azure.net/.default";
 
     private final String clientName;
 
@@ -70,6 +73,8 @@ public final class EventGridPublisherClientBuilder {
 
     private AzureSasCredential sasToken;
 
+    private TokenCredential tokenCredential;
+
     private EventGridServiceVersion serviceVersion;
 
     private String endpoint;
@@ -131,14 +136,29 @@ private <T> EventGridPublisherAsyncClient<T> buildAsyncClient(Class<T> eventClas
 
         httpPipelinePolicies.add(new AddDatePolicy());
 
-        // Using token before key if both are set
+        final int credentialCount = (sasToken != null ? 1 : 0) + (keyCredential != null ? 1 : 0)
+            + (tokenCredential != null ? 1 : 0);
+        if (credentialCount > 1) {
+            throw logger.logExceptionAsError(
+                new IllegalStateException("More than 1 credentials are set while building a client. "
+                    + "You should set one and only one credential of type 'TokenCredential', 'AzureSasCredential', "
+                    + "or 'AzureKeyCredential'."));
+        } else if (credentialCount == 0) {
+            throw logger.logExceptionAsError(
+                new IllegalStateException("Missing credential information while building a client."
+                    + "You should set one and only one credential of type 'TokenCredential', 'AzureSasCredential', "
+                    + "or 'AzureKeyCredential'."));
+        }
         if (sasToken != null) {
             httpPipelinePolicies.add((context, next) -> {
                 context.getHttpRequest().getHeaders().set(AEG_SAS_TOKEN, sasToken.getSignature());
                 return next.process();
             });
-        } else {
+        } else if (keyCredential != null) {
             httpPipelinePolicies.add(new AzureKeyCredentialPolicy(AEG_SAS_KEY, keyCredential));
+        } else {
+            httpPipelinePolicies.add(new BearerTokenAuthenticationPolicy(this.tokenCredential,
+                DEFAULT_EVENTGRID_SCOPE));
         }
 
         httpPipelinePolicies.addAll(policies);
@@ -238,7 +258,7 @@ public EventGridPublisherClientBuilder credential(AzureKeyCredential credential)
 
     /**
      * Set the domain or topic authentication using an already obtained Shared Access Signature token.
-     * @param credential the token credential to use.
+     * @param credential the sas credential to use.
      *
      * @return the builder itself.
      */
@@ -247,6 +267,19 @@ public EventGridPublisherClientBuilder credential(AzureSasCredential credential)
         return this;
     }
 
+    /**
+     * Set the domain or topic authentication using Azure Activity Directory authentication.
+     * Refer to <a href="/Azure/azure-sdk-for-java/tree/main/sdk/identity/azure-identity">azure-identity</a>
+     *
+     * @param credential the token credential to use.
+     *
+     * @return the builder itself.
+     */
+    public EventGridPublisherClientBuilder credential(TokenCredential credential) {
+        this.tokenCredential = credential;
+        return this;
+    }
+
     /**
      * Set the domain or topic endpoint. This is the address to publish events to.
      * It must be the full url of the endpoint instead of just the hostname.
diff --git a/sdk/eventgrid/azure-messaging-eventgrid/src/samples/java/com/azure/messaging/eventgrid/samples/ReadmeSamples.java b/sdk/eventgrid/azure-messaging-eventgrid/src/samples/java/com/azure/messaging/eventgrid/samples/ReadmeSamples.java
index a80ccb8df5c8d..a81d84e0f875d 100644
--- a/sdk/eventgrid/azure-messaging-eventgrid/src/samples/java/com/azure/messaging/eventgrid/samples/ReadmeSamples.java
+++ b/sdk/eventgrid/azure-messaging-eventgrid/src/samples/java/com/azure/messaging/eventgrid/samples/ReadmeSamples.java
@@ -10,6 +10,7 @@
 import com.azure.core.util.BinaryData;
 import com.azure.core.util.serializer.TypeReference;
 import com.azure.core.models.CloudEvent;
+import com.azure.identity.DefaultAzureCredentialBuilder;
 import com.azure.messaging.eventgrid.EventGridEvent;
 import com.azure.messaging.eventgrid.EventGridPublisherAsyncClient;
 import com.azure.messaging.eventgrid.EventGridPublisherClient;
@@ -99,8 +100,8 @@ public void createCustomEventPublisherAsyncClient() {
     }
 
     public void createPublisherClientWithSas() {
-        EventGridPublisherClient<CloudEvent> eventGridEventClient = new EventGridPublisherClientBuilder()
-            .endpoint("<endpont of your event grid topic/domain that accepts CloudEvent schema>")
+        EventGridPublisherClient<CloudEvent> cloudEventClient = new EventGridPublisherClientBuilder()
+            .endpoint("<endpoint of your event grid topic/domain that accepts CloudEvent schema>")
             .credential(new AzureSasCredential("<sas token that can access the endpoint>"))
             .buildCloudEventPublisherClient();
     }
@@ -224,4 +225,18 @@ public void systemEventDifferentEventData() {
             }
         }
     }
+
+    public void createPublisherClientWithTokenCredential() {
+        EventGridPublisherClient<CloudEvent> cloudEventClient = new EventGridPublisherClientBuilder()
+            .endpoint("<endpoint of your event grid topic/domain that accepts CloudEvent schema>")
+            .credential(new DefaultAzureCredentialBuilder().build())
+            .buildCloudEventPublisherClient();
+    }
+
+    public void createPublisherAsyncClientWithTokenCredential() {
+        EventGridPublisherAsyncClient<CloudEvent> cloudEventClient = new EventGridPublisherClientBuilder()
+            .endpoint("<endpoint of your event grid topic/domain that accepts CloudEvent schema>")
+            .credential(new DefaultAzureCredentialBuilder().build())
+            .buildCloudEventPublisherAsyncClient();
+    }
 }
diff --git a/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientOnlyTests.java b/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientOnlyTests.java
index 7b11e50ec4f9e..7aa49990e0fe7 100644
--- a/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientOnlyTests.java
+++ b/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientOnlyTests.java
@@ -4,6 +4,7 @@
 package com.azure.messaging.eventgrid;
 
 import com.azure.core.credential.AzureKeyCredential;
+import com.azure.identity.DefaultAzureCredentialBuilder;
 import org.junit.jupiter.api.Test;
 
 import java.io.UnsupportedEncodingException;
@@ -15,6 +16,7 @@
 import java.time.format.DateTimeFormatter;
 
 import static org.junit.jupiter.api.Assertions.assertEquals;
+import static org.junit.jupiter.api.Assertions.assertThrows;
 import static org.junit.jupiter.api.Assertions.assertTrue;
 
 public class EventGridPublisherClientOnlyTests {
@@ -49,4 +51,30 @@ public void testGenerateSas() throws UnsupportedEncodingException {
 
         assertTrue(sasToken1.contains(unsignedSas));
     }
+
+    @Test
+    public void createPublisherClientWithNoCredentials() {
+        final String fullEndpoint = String.format("%s?%s=%s", DUMMY_ENDPOINT, "api-version",
+            EventGridServiceVersion.getLatest().getVersion());
+
+        assertThrows(IllegalStateException.class, () -> {
+            new EventGridPublisherClientBuilder()
+                .endpoint(fullEndpoint)
+                .buildCloudEventPublisherClient();
+        });
+    }
+
+    @Test
+    public void createPublisherClientWithTwoCredentials() {
+        final String fullEndpoint = String.format("%s?%s=%s", DUMMY_ENDPOINT, "api-version",
+            EventGridServiceVersion.getLatest().getVersion());
+
+        assertThrows(IllegalStateException.class, () -> {
+            new EventGridPublisherClientBuilder()
+                .endpoint(fullEndpoint)
+                .credential(new AzureKeyCredential("FakeCredential"))
+                .credential(new DefaultAzureCredentialBuilder().build())
+                .buildCloudEventPublisherClient();
+        });
+    }
 }
diff --git a/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientTests.java b/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientTests.java
index 498c1846d7405..00ff1b41b5395 100644
--- a/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientTests.java
+++ b/sdk/eventgrid/azure-messaging-eventgrid/src/test/java/com/azure/messaging/eventgrid/EventGridPublisherClientTests.java
@@ -15,6 +15,8 @@
 import com.azure.core.util.Context;
 import com.azure.core.models.CloudEvent;
 import com.azure.core.util.serializer.JacksonAdapter;
+import com.azure.identity.DefaultAzureCredential;
+import com.azure.identity.DefaultAzureCredentialBuilder;
 import com.fasterxml.jackson.core.JsonGenerator;
 import com.fasterxml.jackson.databind.JsonSerializer;
 import com.fasterxml.jackson.databind.SerializerProvider;
@@ -160,6 +162,32 @@ public void publishWithSasToken() {
             .verifyComplete();
     }
 
+    @Test
+    @Disabled
+    public void publishWithTokenCredential() {
+        DefaultAzureCredential defaultCredential = new DefaultAzureCredentialBuilder().build();
+        EventGridPublisherAsyncClient<CloudEvent> egClient = builder
+            .credential(defaultCredential)
+            .endpoint(getEndpoint(CLOUD_ENDPOINT))
+            .buildCloudEventPublisherAsyncClient();
+
+        List<CloudEvent> events = new ArrayList<>();
+        events.add(new CloudEvent("/microsoft/testEvent", "Microsoft.MockPublisher.TestEvent",
+            BinaryData.fromObject(new HashMap<String, String>() {
+                {
+                    put("Field1", "Value1");
+                    put("Field2", "Value2");
+                    put("Field3", "Value3");
+                }
+            }), CloudEventDataFormat.JSON, "application/json")
+            .setSubject("Test")
+            .setTime(OffsetDateTime.now()));
+
+        StepVerifier.create(egClient.sendEventsWithResponse(events, Context.NONE))
+            .expectNextMatches(voidResponse -> voidResponse.getStatusCode() == 200)
+            .verifyComplete();
+    }
+
     @Test
     public void publishCloudEvents() {
         EventGridPublisherAsyncClient<CloudEvent> egClient = builder
diff --git a/sdk/eventgrid/azure-messaging-eventgrid/src/test/resources/session-records/publishWithTokenCredential.json b/sdk/eventgrid/azure-messaging-eventgrid/src/test/resources/session-records/publishWithTokenCredential.json
new file mode 100644
index 0000000000000..95823bab3c354
--- /dev/null
+++ b/sdk/eventgrid/azure-messaging-eventgrid/src/test/resources/session-records/publishWithTokenCredential.json
@@ -0,0 +1,23 @@
+{
+  "networkCallRecords" : [ {
+    "Method" : "POST",
+    "Uri" : "https://REDACTED.westus2-1.eventgrid-int.azure.net/api/events?api-version=2018-01-01",
+    "Headers" : {
+      "User-Agent" : "azsdk-java-UnknownName/UnknownVersion (15.0.2; Windows 10; 10.0)",
+      "x-ms-client-request-id" : "d9d08daa-f908-4338-ab35-ad6042dc5b9c",
+      "Content-Type" : "application/cloudevents-batch+json; charset=utf-8"
+    },
+    "Response" : {
+      "content-length" : "0",
+      "Strict-Transport-Security" : "max-age=31536000; includeSubDomains",
+      "Server" : "Microsoft-HTTPAPI/2.0",
+      "api-supported-versions" : "2018-01-01",
+      "retry-after" : "0",
+      "StatusCode" : "200",
+      "x-ms-request-id" : "83028bf1-abe4-49ee-a244-ad5e66335d25",
+      "Date" : "Fri, 25 Jun 2021 21:19:01 GMT"
+    },
+    "Exception" : null
+  } ],
+  "variables" : [ ]
+}
\ No newline at end of file